Painting & Wall Covering Contractors NAICS 238320

Nov 17, 2025 - Residential Remodeling Spending Remains Stable

• Home remodeling spending is expected to remain stable for the rest of this year and through mid-2026, according to the Leading Indicator of Remodeling Activity (LIRA) report released in October by the Joint Center for Housing Studies at Harvard. Homeowner improvements and repairs are expected to increase 1.9% to $511 billion in the fourth quarter of 2025, compared to Q4 2024. In the first quarter of 2026, remodeling spending will reach $524 billion, up 2.4% from Q1 2025. Spending will then moderate to $519 billion in Q2 2026, up 2.1% from Q2 2025. In the third quarter of 2026, year-over-year spending is forecast to rise 1.9% to $517 billion. While solid remodeling permitting activity and gradually improving single-family home sales will support remodeling activity, potential headwinds include continued weakness of housing starts and economic uncertainty.
• President Trump’s tariffs and immigration crackdown are straining US homebuilders, raising costs and worsening labor shortages, according to The New York Times. Builders face higher prices for steel, copper, lumber, and other materials, with tariffs adding up to $10,900 to the cost of a typical home, according to the National Association of Home Builders. Immigration enforcement has made workers fearful, delaying projects and shrinking crews. Construction added only 6,000 jobs through August, despite an Associated Builders and Contractors projection that nearly 500,000 more workers will be needed in 2026. Builders are slowing activity, cutting budgets, and bracing for slower growth as high mortgage rates and weak demand are dragging down sales. Economists warn that even if interest rates fall, labor and material pressures could intensify.

• North American construction and engineering spending in 2026 is expected to rise 1% after decreasing an estimated 1% in 2025, according to FMI’s fourth-quarter 2025 North American Engineering and Construction Outlook. Multifamily construction is expected to decline by 2% in 2026, amid oversupply in some key markets and weak rent growth. Single-family construction is projected to rise by 1% in 2026, as stubbornly high interest rates and elevated home prices continue to reduce demand. Commercial construction spending is forecast to decline by 4% in 2026 as retail store closures surpass openings for the first time in a decade and warehouse vacancies remain high. Lodging construction is expected to decline by 2% in 2026, amid sluggish business travel growth and as financing conditions and maturing debt pose headwinds. Even as vacancy rates remain high, office construction spending is expected to grow 7% in 2026, driven by the expansion of data centers and the conversion of offices to multifamily use. Federal funding cuts are projected to result in flat educational construction spending in 2026, while healthcare projects are expected to see a 3% increase.
• Slow single-family home sales could weaken demand for paint and wallcovering contractors. America’s largest homebuilders are struggling to sell new homes despite offering 4% mortgages and deep discounts, according to The Wall Street Journal. D.R. Horton and Lennar have slashed prices and added incentives, but demand remains weak, pushing unsold inventory to levels last seen in 2009. Builders are slowing construction, with D.R. Horton cutting starts by 21% year over year for the three-month period through September. Regional gluts in Texas, Florida, Southern California, and Washington, DC reflect rising resale competition, fewer foreign buyers, and economic uncertainty. Investor activity is at a 15-year low, with institutional buyers demanding steep discounts that builders won’t meet. New homes, often located in less desirable areas and targeted at first-time buyers, are more challenging to sell.