CAMBRIDGE, MA – Annual expenditures for improvements and maintenance to owner-occupied homes are projected to remain steady through the end of this year and into the middle of 2026, according to the Leading Indicator of Remodeling Activity (LIRA) released today by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University. The LIRA projects that year-over-year spending on home renovation and repair will rise by 2.4 percent in early 2026 before easing to 1.9 percent in the third quarter of next year.
“Upward trends in both remodeling permit activity and single-family home sales suggest that demand for home improvement will remain stable in the coming year,” says Rachel Bogardus Drew, Director of the Remodeling Futures Program at the Center. “Despite the modest pace, total homeowner remodeling spending is expected to reach $524 billion in early 2026, a new record high.”
“If the housing market begins to show signs of momentum, remodeling could be poised for stronger growth into 2027,” says Chris Herbert, Managing Director of the Center. “However, sluggish housing starts and uncertainty in the broader economy, which are factors in predicting remodeling expenditures, are creating headwinds to larger gains in renovation and repair spending.”
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The Leading Indicator of Remodeling Activity (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. Originally developed in 2007, the LIRA was re-benchmarked in April 2016 to a broader market measure based on the biennial American Housing Survey.
The LIRA is released by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University in the third week after each quarter’s closing. The next LIRA release date has been postponed to January 26, 2026.
The Remodeling Futures Program, initiated by the Joint Center for Housing Studies in 1995, is a comprehensive study of the factors influencing the growth and changing characteristics of housing renovation and repair activity in the United States. The Program seeks to produce a better understanding of the home improvement industry and its relationship to the broader residential construction industry.
The Harvard Joint Center for Housing Studies strives to improve equitable access to decent, affordable homes in thriving communities. We conduct rigorous research to advance policy and practice, and we bring together diverse stakeholders to spark new ideas for addressing housing challenges. Through teaching and fellowships, we mentor and inspire the next generation of housing leaders.
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