What were the biggest challenges renovation professionals faced last year and how optimistic are they about 2025? These are just some of the questions posed to firms on Houzz in our annual State of the Industry report*. If you’d like to know how your fellow pros are navigating business at the moment, take a look at our rundown of the key findings from the 2025 report.
* 2025 UK Houzz State of the Industry was conducted among home renovation firms in the Houzz UK community that offer services related primarily to residential renovation and/or design. The study was fielded from December 2024 to February 2025. N=160.
How was 2024 for renovation professionals?
For many of the professionals who took part in our survey, 2024 was a challenging year, with more firms reporting a decrease in annual revenue and profitability than in 2023. Almost half (47%) said their revenues were low last year compared to 43% in 2023, and 62% experienced lower profitability compared to 51% the year before.
Architects were the hardest hit professional group (72%), followed by interior designers and design and build firms (62% and 57%, respectively).
How are renovation professionals feeling about the year ahead?
More than half of respondents (57%) expect gross revenues to rise in 2025, and 52% forecast an increase in net income. Interior designers are the most optimistic, with 70% expecting an increase in profitability, and 44% forecasting a rise in demand for their services.
Architects are a little more cautious, with 52% saying they expect an increase in profits, while 31% of design and build firms predict a similar rise.
Are renovation firms expanding their teams?
Firms are hiring a little more, with a greater number of respondents reporting staff increases last year compared to the year before (15% in 2024 vs 13% in 2023). This trend looks set to continue, as 25% of firms said they expect to hire more in 2025 compared to 21% in 2024.
Hiring challenges seem to be easing slightly, with fewer of our respondents citing this as a barrier to business in 2024 compared to 2023 (5% vs 9%) and, similarly, only 5% said subcontractor shortages were an issue last year compared to 13% in 2023.
What were the greatest challenges last year?
Although firms cited difficulty finding prospective customers as one of their biggest challenges in 2024, this had improved by 6 percentage points since the previous year (33% compared to 39% in 2023).
Interior designers found finding customers particularly tricky, followed by design and build firms and then architects (50%, 36% and 24%, respectively).
Consumers being overly concerned about costs was the biggest issue for renovation firms last year (50%), while 29% said that business costs were challenging, and 24% cited an uncertain national economy as an impediment to business.
Other challenges included clients having unreasonable expectations, difficulties keeping up with current workloads, and the maintenance of healthy profit margins, among others.
What do pros expect to be the biggest challenges in 2025?
Renovation pros forecast rising overhead, labour and product costs to be one of the biggest issues in the year ahead.
However, the number of firms who predict these to worsen has reduced since the previous year. This is particularly marked when it comes to the cost of overheads, with 53% expecting them to worsen compared to 70% the previous year.
Although pros predict the economy to be a challenge, they’re also more optimistic about it, both locally and nationally, than in the previous year; 19% expect the former to worsen versus 34% in the previous year, and 33% forecast a worsening of the national picture compared to 47% the year before.
