Remodeling to See Annual Gains Despite Economic Uncertainty

Annual spending on home improvement and maintenance to owner-occupied homes is expected to grow modestly through 2026, according to the Leading Indicator of Remodeling Activity (LIRA) from the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects that year-over-year spending for home renovation and repair will increase by 2.5% to reach a record $526 billion by the first quarter of 2026.

"A slight downturn after the pandemic’s record expenditures gave way to modest gains in the sector this year," says Carlos Martín, director of the Remodeling Futures Program. "Recent increases in the sales of existing homes are expected to drive slow but steady growth in home remodeling and repair."

High home values and other strong economic indicators have supported an uptick in homeowner improvement spending, according to Chris Herbert, the Center's managing director. "However, economic volatility due to the uncertainty surrounding foreign tariffs and falling consumer confidence could well dampen this expected growth," he says.

LIRA provides a short-term outlook of national home improvement and repair spending to owner-occupied homes. The indicator, measured as an annual rate-of-change of its components, is designed to project the annual rate of change in spending for the current quarter and subsequent four quarters, and is intended to help identify future turning points in the business cycle of the home improvement and repair industry.