Interior Design Services NAICS 541410

Nov 20, 2025 - Remodeling Spending Growth Remains Steady

• Several factors support steady growth in the North American residential improvements market, according to FMI’s fourth-quarter 2025 North American Engineering and Construction Outlook. Spending on residential remodeling is forecast to rise 2% in 2026 and 2027 before increasing by 4% in 2028 and 5% in 2029. The median age of an owner-occupied home is nearly 45 years, and repair and replacement of home systems is expected to outpace discretionary remodeling spending. As home values have risen, more homeowners are tapping the equity in their homes as a source of financing for repairs and upgrades. As of Q2 2025, home equity lines of credit (HELOC) balances were up 8% compared to the same period in 2024, according to the Federal Reserve's Household Debt and Credit Report. In their third-quarter reporting, Home Depot and Lowe's said Q3 professional contractor sales were stronger than DIY sales.
• The National Association of Realtors' 2025 Profile of Home Buyers and Sellers reveals a sharp decline in first-time home buyers, now just 21% of home purchases, with a median age of 40. This shift, driven by affordability challenges, is reshaping interior design demand. With fewer young buyers and more equity-rich repeat buyers with an average age of 62, designers must pivot toward aging-in-place solutions, multigenerational layouts, and upscale personalization. The rise in all-cash purchases and larger down payments signals a preference for turnkey, customized spaces. The industry must adapt to serving older, wealthier clients seeking comfort, functionality, and long-term value, while advocating for housing policies that expand access and revive demand from younger, design-hungry first-time buyers.

• Sales of existing US homes increased by 1.2% in October from September and were up 1.7% year-over-year, according to the National Association of Realtors (NAR). NAR chief economist Lawrence Yun said, "Home sales increased in October even with the government shutdown due to homebuyers taking advantage of lower mortgage rates. First-time homebuyers are facing headwinds in the Northeast due to a lack of supply and in the West because of high home prices. First-time buyers fared better in the Midwest because of the plentiful supply of affordable houses and in the South because there is sufficient inventory." Existing home sales are a demand driver for interior design services.
• Demand for interior design services could be impacted amid a recent round of new tariffs on some types of building materials. On October 14, 2025, the US began adding a 25% levy on cabinets, vanities, and unupholstered furniture imports, and 10% tariffs on wood floors, lumber, and wood, according to The New York Times. Industry watchers say the new tariffs will significantly raise construction and renovation costs for U.S. homebuilders. With duties reaching up to 50% on some items by January, builders who rely on foreign materials warn of project delays and increased uncertainty. The National Association of Home Builders estimates that 7% of materials used in new residential construction are imported. Industry leaders fear the added costs will be passed on to consumers, making homeownership and renovations more expensive while slowing new home construction, deepening the housing shortage, and offsetting any relief from falling interest rates.