Interior Design Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 15,200 interior design firms in the US plan, design, and administer projects in interior spaces to meet the physical and aesthetic needs of customers. Revenue comes primarily from design services and product sales. Companies may specialize in a particular sector (hospitality, health care, institutional, residential), room (kitchens, bathrooms, closets), or style (contemporary, traditional).
Demand Driven By Construction Trends
Interior design services are often tied to new construction and remodeling projects.
Design Driven By Trends And Fads
The interior design market is often driven by styles and trends in the fashion world.
Industry size & Structure
The average interior design service provider operates out of a single location, employs 3-4 workers, and generates about $1.3 million annually.
- The interior design services industry consists of about 15,200 companies that employ about 55,000 workers and generate $19.3 billion annually.
- The industry is highly fragmented; the top 50 firms account for 15% of industry sales.
- Large companies that offer interior design as part of a portfolio of services include Gensler, HOK, and Perkins+Will. The majority of firms are small, independent companies with localized operations.
Industry Forecast
Interior Design Services Industry Growth
Recent Developments
Mar 21, 2025 - Buyers Gain Leverage in Housing Market
- The advantage in the US housing market may be shifting from sellers to buyers, according to The Wall Street Journal. Bidding wars are less common as competition over homes on the market has waned, which is giving potential buyers more leverage. On average, existing homes are selling for 2% below the asking price, according to Redfin. The reduction in seller pricing power is partly due to more homes coming onto the market. According to Redfin, new listings were up 5% in January compared to a year earlier. Houses are also staying on the market longer, creating an advantage for buyers. In January, the typical home sale had been on the market for two months, marking the most extended period since February 2020, according to Redfin. A healthy housing market is a demand indicator for interior design services.
- Affordability in the US housing market is expected to improve slightly in 2025 and 2026, but strides will be due to falling interest rates rather than lower home prices, according to a recent Reuters poll of property market insiders. Nearly two-thirds (62%) of those surveyed in February 2025 said that affordability conditions for first-time home buyers would improve over the coming year. Polling medians suggested survey respondents expect average 30-year mortgage rates to drop to 6.76% in 2025 and 6.32% in 2026. While home prices are expected to continue rising, the pace of price growth will slow. Moody’s Analytics estimates there is a shortage of about 2.6 million units. Homeowners who locked in low mortgage rates before they began rising are reluctant to sell, leaving potential buyers relying more on the new home market.
- A lack of affordability in the new single-family home market could reduce demand for interior design services. In 2025, nearly 75% of US households are unable to afford a median-priced new home, according to the National Association of Home Builders. Given a median new home price of $459,826 and a 30-year mortgage rate of 6.5%, more than 100 million US households are priced out of the market. In 23 US states and Washington DC, more than 80% of households cannot afford a median-priced new home, suggesting a significant discrepancy between home prices and household incomes.
- Home remodeling spending is expected to see slight gains in 2025 after two years of weakening expenditures, according to the Leading Indicator of Remodeling Activity (LIRA) report released in January by the Joint Center for Housing Studies at Harvard. Homeowner improvements and repairs are expected to increase by 0.4% to $513 billion in the first quarter of 2025 compared to Q1 2024. In the second quarter of 2025, remodeling spending will rise quarter-over-quarter to $505 billion, up 0.7% from Q2 2024. Spending will then increase to $506 billion in Q3 2025, up 1.2% from Q3 2024. In the fourth quarter of 2025, year-over-year spending is forecast to rise 1.2% to $509 billion. Joint Center expects improvements will be supported by rising home values, a steady labor market, and gradually improving sales of existing homes. Better retail sales of building materials and solid remodeling permitting activity should also support home improvement spending.
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