Leading Indicator of Remodeling Activity Points Slow but Steady Growth Into 2026

On Thursday, the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University released its Leading Indicator of Remodeling Activity (LIRA) report for Q3. Annual expenditures for improvements and maintenance to owner-occupied homes are projected to remain steady through the end of this year and into mid-2026.

The LIRA projects that year-over-year spending for home renovation and repair will rise to 2.4% in 2026Q1 before easing to 1.9% in 2026Q3.

The indicator provides a short-term outlook of national home improvement and repair spending to owner-occupied homes. It measures the annual rate of change in spending for the current quarter and the subsequent four quarters and is designed to help identify turning points in the home improvement and repair business cycle.

Rachel Bogardus Drew, Director of the Remodeling Futures Program at the Center, said:

“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. Despite the modest pace, total homeowner remodeling spending is expected to reach $524 billion in early 2026, a new record high.”

Chris Herbert, Managing Director of the Center, added:

“If the housing market begins to show signs of momentum, remodeling could be poised for stronger growth into 2027. 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.”