HVAC & Plumbing Contractors NAICS 238220

Jun 17, 2026 - Fitch Downgrades Outlook for Builders, Building Products

• Fitch Ratings revised its 2026 outlooks for the US homebuilding and North America building products sectors to deteriorating from neutral. The agency cited affordability challenges, weak consumer sentiment, and mortgage rates expected to remain near 6.5%. For surveying and mapping services firms, weaker single-family construction activity and slower housing turnover could reduce demand for residential boundary surveys, subdivision planning, site development, and other land-related projects tied to new home construction. Fitch expects new home sales to decline 2.5% and single-family housing starts to fall 4.5% this year, while homebuilders cut prices and offer incentives to attract buyers. Nonresidential construction tied to data centers and power infrastructure is helping offset some residential weakness, creating opportunities for surveying and mapping firms serving those projects.
• Home builder confidence in the single-family market fell in June as builders remain concerned about housing affordability, higher construction costs, and elevated interest rates, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), dropped two points to 35 in June 2026. Any HMI reading over 50 indicates that more builders see conditions as good than poor. June marked the 14th consecutive month the HMI remained below 40, a level not seen since the foreclosure crisis of 2011-2012. The survey also showed that 35% of builders reduced home prices in June to lure potential buyers off the sidelines, although the average price reduction of 6% remained unchanged from April. Builders argue that regulatory hurdles - including permitting delays, density limits, and inefficient zoning rules - create bottlenecks that slow new housing growth.

• According to Facilities Dive, the US Supreme Court sent a legal challenge involving federal energy-efficiency standards for non-condensing commercial gas water heaters and residential gas furnaces back to a lower appeals court, leaving the Department of Energy rules in limbo while the agency considers revising them. For HVAC and plumbing contractors, the outcome could affect equipment selection, replacement planning, retrofit costs, and future demand for condensing systems, particularly for customers with existing appliances that rely on traditional vertical venting. The dispute centers on whether venting systems qualify as a protected performance characteristic under federal law. Critics, including the American Gas Association, argue the rules would effectively eliminate a class of non-condensing products and increase costs, while supporters maintain the standards are legally sound and should ultimately remain in place despite the extended legal review.
• The total value of US construction put in place rose 0.4% in April 2026 compared to the prior month, according to the US Census Bureau. Residential spending grew 0.8%, and nonresidential spending increased 0.1%. Overall, construction spending in April surpassed economists' expectations of just 0.2% growth. A 1.4% increase in single-family project spending led April's growth, even as the conflict with Iran stoked inflation and sent the 30-year fixed mortgage rate higher. Spending on private nonresidential buildings declined 0.2% in April. Private nonresidential structure spending has fallen for nine consecutive quarters, despite the data center boom. Bright spots in April nonresidential building construction included a 1.9% rise in public safety project spending and a 1% increase in offices (a category that includes data centers). Lodging, educational, and healthcare also saw slight upticks.