Home improvement pros have noticed an uptick in projects from homeowners across all age groups in the U.S. this year compared to last, as the latest Houzz Renovation Barometer shows, with particular demand from Gen Xers and baby boomers. The barometer index tracks industry optimism among architects, designers, general contractors and remodelers, design-build firms, building and renovation specialty firms, and landscape and outdoor specialty firms. 

Gains in the number of inquires and new projects, and the size of new projects, compared to the previous quarter have contributed to industry confidence. Many firms have reported an increase in kitchen and bath renovations, smart technology and aging-related projects so far in 2016 compared to the same period in 2015. That said, their confidence level is slightly down compared to the first part of the year, the barometer found. 

“Barometer readings over the past six quarters have shown consistent confidence in the home renovation industry, despite slight softening in some sectors,” says Nino Sitchinava, principal economist at Houzz. “The increase in baby boomer and Gen Xer activity, as well as an uptick in kitchen and bath activity, is consistent with our recent insights from other studies of homeowners and a great sign of the vitality of our industry.”

More projects from Gen Xers and baby boomers. 

Though there is growth across the board, firms are noticing increases in demand particularly among clients ages 35 and up. Half or more firms reported an increase in projects from Gen Xers (ages 35 to 54) in the first half of this year, compared to the same period last year. Projects from baby boomers (55-plus) increased for more than one-third of all types of firms. Demand from the youngest group of homeowners (millennials, under age 35) is also up, though at a lower rate than from the older groups. About one-fifth to one-third of firms, depending on their specialty, are seeing increases in demand from millennials, with 21 percent to 28 percent reporting increases compared to last year.

Kitchen and bath projects on the rise. 

Compared to the same period last year, kitchen and bath projects are on the rise in the first half of 2016, with half or more of firms reporting an increase. Firms have also seen an increase in customers’ purchasing high-end products and tackling more than one project at a time.

More smart home and aging-related upgrades. 

The first half of 2016 also saw more specialized projects compared to the same period in 2015. A third of firms across all industry sectors saw increases in smart home technology and aging-related upgrades. Many firms also noticed an increase in energy-efficiency upgrades and eco-friendly, or “green,” projects.

Renovation market strong.

The renovation market continues to perform well, according to the quarterly study from Houzz’s research team, with general contractors and outdoor professionals feeling particularly good about the business atmosphere compared to the prior quarter. Designers, architects and design-build firms, on the other hand, are feeling a little less confident in the business environment than they did at the beginning of this year. 

Industry confidence softening a bit. The Houzz Renovation Barometer measures confidence in the renovation industry each quarter among multiple categories of renovation professionals: architects, designers, general contractors and remodelers, design-build firms, building and renovation specialists, and landscape and outdoor professionals. A number above 50 indicates that more firms reported that business activity is up than those that reported it is down. 

For Q2 2016 — April, May and June — the Houzz Renovation Barometer posted readings of 63 to 78, indicating that renovation professionals feel good about their industry overall. However, the scores also indicate a dip in confidence among design-related professions.

Architects, designers and design-build companies posted confidence scores that were 5 to 7 percent lower than their responses in the prior three months. With these three groups feeling less confident, that’s half of the six industry groups surveyed posting weaker confidence scores in the second quarter of 2016 than the first. This softening underscores that the quarter-over-quarter gains in the number of new inquires and projects, as well as the size of new projects, were not as widespread as they were in the previous quarter.

Confidence scores for general contractors and remodelers stayed flat in the second quarter compared to the first.

Only landscape and outdoor specialists and building and renovation specialists saw their scores rise in the second quarter of the year. The first group includes landscape architects, designers and contractors, as well as outdoor replacement trades (pavers) and outdoor product installers, manufacturers and resellers (for example, of pools and spas). The second group, building and renovation specialists, includes replacement contractors — carpenters, for example — as well as product installers, manufacturers and resellers of products for inside the home, such as cabinetry.

Slowing growth in new business activity. 

In line with the dip in confidence scores, renovation professionals across the board are seeing fewer inquires from would-be clients in the second quarter compared to the first quarter of 2016 — with the exception of landscape and outdoor specialty firms. The number of new projects or orders fell for design-related professionals (architects, designers and design-build firms), while it rose for construction professionals (general contractors and remodelers, building and renovation specialists, and landscape and outdoor specialists). 

This most recent Houzz Renovation Barometer study was fielded June 29 to July 14, 2016, and included 2,659 respondents.

Regional patterns consistent with national. 

There is a mild weakening of confidence in design-related sectors of the home renovation industry, and the regional pattern is consistent with the national trend. The confidence dip was felt most strongly in the Northeast during the second quarter; Northeastern architects reported the largest decline (14 percent).

Market gains slowing year over year. 

The dip in scores seen during Q2 2016 continues a yearlong pattern. Confidence among design-related sectors has declined for four straight quarters, as this graph shows. Five of the six industry groups posted lower confidence in Q2 2016 than they did in Q2 2015. The scores are still well above 50, indicating that growth is continuing in 2016 but at a slower pace compared to 2015.

This article is by Houzz Editorial Staff writer Erin Carlyle. Erin writes about the cost of renovation and what it takes to remodel. She is a former Forbes real estate reporter who is fascinated by cool homes and watching the bottom line.