Remodeling Market to Gain 5% in 2025

LAS VEGAS – If the remodeling market is a big part of your business, industry experts predict moderate growth for the sector in 2025.

A panel of industry experts at the International Builders Show (IBS) last week attributes that bright outlook to aging housing stock, record levels of home equity, and favorable demographics.

However, inflation remains a concern as shelter costs continue to be iffy, despite measures by the Federal Reserve Bank. And, while lower mortgage rates are potentially on the horizon, long-term interest rates could remain flat or even increase with larger fiscal deficits.

The National Association of Home Builders/Westlake Royal Remodeling Market Index (RMI), a quarterly survey of NAHB remodeler members, continues to exhibit positive sentiment, especially when compared to other housing sectors.

NAHB economist Eric Lynch says remodeler sentiment has remained in positive territory since the second quarter of 2020, with one of the key factors for growth being the aging housing stock.

“Homeowners are increasingly choosing to tap into their home equity and invest in improvements rather than relocate, creating long-term growth prospects for the industry,” Lynch said.

The RMI survey also showed increasing awareness by consumers of the aging-in-place concept.

Lynch noted that while the industry has seen gradual improvements in the availability of labor and materials over the past few years, both remain ongoing challenges for remodelers. Some products are also in short supply, with plumbing fixtures and fittings and cabinets most likely to impact the hard surfaces industry.

NAHB is forecasting residential remodeling activity to post a 5% gain this year, and a nominal gain of 3% in 2026.