Painting & Wall Covering Contractors NAICS 238320

May 18, 2026 - Remodeling Spending to Slow Early Next Year

• Home remodeling spending growth is expected to slow significantly early in 2027, according to the Leading Indicator of Remodeling Activity (LIRA) report released in May by the Joint Center for Housing Studies at Harvard. Homeowner spending on improvements and repairs is expected to increase 1.8% to $516 billion in the second quarter of 2026, compared to Q2 2025. In the third quarter of 2026, remodeling spending will trend slightly upward to $518 billion, up 2.4% from Q3 2025. Spending will then remain flat at $518 billion in Q4 2026, up 1.8% from Q4 2025. In the first quarter of 2027, year-over-year spending is forecast to rise just 0.5% to $523 billion. Remodeling permitting and building product sales have remained flat recently, but homeowners are expected to maintain spending near 2025 levels. Remodeling spending is likely to remain subdued, barring a turnaround in the construction sector.
• New single-family home sales rose 7.4% month-over-month and were up 3.3% year-over-year in March 2026, according to the US Census Bureau. March’s total new home sales reached 682,000 units. The National Association of Home Builders noted the uptick was due to moderating home prices and a lack of inventory in the existing home market. In March, the US median home price was $387,400, down 6.2% from $412,900 a year earlier. To address ongoing affordability constraints, builders have made strides toward offering more homes at the lower end of the price spectrum. In March, 20% of new homes were priced below $300,000. New home sales are a demand driver for painting and wall covering contractors.

• Home builders are cutting costs by using cheaper materials, simplifying designs, and reducing features to make homes more affordable amid high prices, mortgage rates, and economic uncertainty, according to The Wall Street Journal. Builders are installing particle-board cabinets, thinner countertops, fewer windows, and lower-end appliances, while shrinking home sizes and standardizing layouts. Some are also offering mortgage-rate buydowns to attract buyers, but homes still often sell for more than $400,000. Buyers face trade-offs between affordability and quality, with some reporting missing or lower-quality finishes. Industry analysts say these changes are spreading as builders prioritize efficiency and profit margins. While companies argue that homes remain durable and accessible to first-time buyers, critics say newer houses feel less customized and lower in quality than older homes.
• A recent survey by Block, a remodeling planning tech firm, shows homeowners are approaching remodeling with caution as economic pressures reshape industry trends: 53% of respondents budget $25K or less, and 70% rely on savings, reinforcing a shift toward smaller, phased projects rather than full-home renovations. Bathrooms (47%), kitchens (39%), and flooring (35%) dominate project types, reflecting a focus on essential, functional upgrades over resale value. Cost volatility remains a key constraint: 53% of those surveyed cite rising material and labor prices, 33% report reduced budgets, and 52% of those making trade-offs plan to DIY portions of the work. Notably, 30% identify finding a trustworthy contractor as the top barrier, surpassing cost concerns, signaling increased demand for transparency and vetted professionals.