Annual spending on improvements and maintenance to owner-occupied homes is projected to slow sharply in early 2027, according to the latest Leading Indicator of Remodeling Activity (LIRA) from the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University.
The LIRA projects year-over-year growth in home renovation and repair spending of just 0.5% by the first quarter of 2027—a pace that remains positive in nominal terms but is less than overall inflation.
“Growth in remodeling permits and retail spending on building products has been flat recently, signaling stagnant interest in home improvement,” said Rachel Bogardus Drew, director of the Remodeling Futures Program.
Even so, homeowners are expected to maintain spending at roughly last year’s levels, with total improvement and repair expenditures edging up modestly to $523 billion in early 2027.
Chris Herbert, managing director of the Center, notes that remodeling follows the overall housing market.
“Without a sustained rebound in construction, they’re likely to see remodeling spending remain in this low-growth range for the near future,” Herbert added.
The LIRA provides a short-term outlook of national home improvement and repair spending to owner-occupied homes.
The indicator, calculated from the annual rate-of-change of its components, is designed to project the annualized spending for the current quarter and subsequent four quarters.
This is intended to help identify future turning points in the business cycle of the home improvement and repair industry.
According to the report, the LIRA is based on several factors, including remodeling permits and retail spending on building products.
Homeowners and contractors can use the LIRA to make informed decisions about their remodeling projects and business strategies.
The Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University provides research and analysis on the home improvement and repair industry.
The program’s research is based on data from various sources, including the US Census Bureau and the Bureau of Labor Statistics.
In terms of numbers, the LIRA projects that home renovation and repair spending will increase from $518 billion in 2026 to $523 billion in early 2027.
This represents a year-over-year growth rate of 0.5%, which is less than the overall inflation rate.
It also projects that remodeling spending will remain relatively flat over the next few quarters, with some fluctuations in the quarterly growth rates.
For example, the LIRA projects that home renovation and repair spending will increase by 0.2% in the second quarter of 2027, and then decrease by 0.1% in the third quarter.
However, it’s worth looking at the broader context of the housing market, which is a key factor in determining remodeling spending.
As Chris Herbert noted, remodeling follows the overall housing market, and without a sustained rebound in construction, the center is likely to see remodeling spending remain in a low-growth range.
This has implications for homeowners, contractors, and the broader economy, as remodeling spending can have a significant impact on economic activity.
For now, the LIRA provides a useful tool for understanding the outlook for the home improvement and repair industry, and for making informed decisions about remodeling projects and business strategies, including investing in a security door.
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