U.S. Home-Improvement Spending Forecast to Stay Near $525 Billion Through Q3 2027

U.S. home-improvement spending is forecast to stay near $525 billion annually through the third quarter of 2027, even as remodeling firms report stronger expectations for near-term work.

The Leading Indicator of Remodeling Activity (LIRA) covers repairs and improvements to owner-occupied homes. Its forecast uses nominal dollars, without adjusting for inflation, and projects year-over-year growth of 1.5% in the third quarter of 2027. Rachel Bogardus Drew, director of the Remodeling Futures Program at the Center, said, “We expect annual spending to hover around $525 billion through the third quarter of next year.”

The National Association of Home Builders (NAHB) Remodeling Market Index stood at a seasonally adjusted 62 in the third quarter of 2026, one point above the previous quarter. Readings above 50 mean more remodelers rate conditions as good than poor. The Future Indicators Index, which tracks leads, inquiries and backlogs, rose two points to 54.

A Q4 2026 construction survey showed stronger near-term expectations. Its Expected Business Activity Indicator rose 13 points to 74 from 61 in the third quarter. The measure tracks firms’ expectations for project inquiries and newly committed projects during the coming three months. Fielded from Oct. 2-13, the survey drew 434 responses: 145 from build-only remodelers and 289 from design-build firms. The respondents were platform users, so the results reflect a survey sample rather than a census of U.S. remodelers.

The expected-activity reading rose to 72 from 59 for build-only remodelers and to 75 from 63 for design-build firms. Architecture and design services firms moved in the other direction, with their indicator falling six points to 62 from 68.

The survey also put its Recent Business Activity Indicator at 55 in the third quarter, up from 47 in the second. Its project-inquiry component was 50, while the new-committed-projects component rose to 60. These readings describe recent activity; the 74 score measures expectations.

Elliott Pike, chair of NAHB Remodelers, said economic uncertainty is prompting some potential customers to pause before moving ahead with projects. The different readings reflect different measures: LIRA estimates nominal spending on owner-occupied homes, while the surveys track remodelers’ views and expectations. Stronger survey results do not by themselves establish that total remodeling spending has accelerated.