The home remodeling sector is stuck in second gear

High construction costs plus bleak consumer sentiment equals flat remodeling growth: NAHB
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The home remodeling sector is stuck in second gear

High construction costs plus bleak consumer sentiment equals flat remodeling growth: NAHB
Home remodeling spending stalled in the second quarter of 2026.

Remodeling activity posted a bagel in the second quarter, with the average growth rate across all U.S. states clocking in at 0%.

Remodeling spending fell in 26 states and rose in 24 states, according to quarterly survey findings from the National Association of Home Builders.

While the overall flat results are “consistent with NAHB’s forecast for remodeling spending in 2026,” said the trade group’s chief economist, Robert Dietz, regional patterns emerged.

“Second-quarter spending growth was concentrated in smaller states,” Dietz noted in a press release. “Among the 10 states with the largest market shares, only North Carolina and Illinois recorded growth.”

The largest increases in second-quarter remodeling spending were seen in Michigan (up $217.1 million, or 3.5%); Alabama (up $158.3 million, or 4.2%); and West Virginia (up $140.6 million, or 10.7%).

But the top states by market share have seen remodeling outlays sag over the past year.

California, which accounts for about 8% of the market, saw its remodeling spending fall 6.1% on a four-quarter moving average as of the second quarter. Texas experienced a 2.7% decline over that period, while Florida dipped by 4.8% and New York by 4%.

NAHB Remodelers Chairman Elliott Pike pointed to “rising construction costs and weak consumer sentiment” as factors holding back remodelers. But he also sees “solid long-term growth potential” for the sector.

“An aging housing stock, the mortgage rate lock-in effect, home equity gains and more homeowners choosing to age in place will support future growth,” Pike said.

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