Tile and Terrazzo Contractors NAICS 238340

Jan 7, 2026 - Builder Confidence in Negative Territory Every Month in 2025

• Home builder confidence in the single-family market increased in December but remained solidly in negative territory as builders face ongoing headwinds, including high construction costs, tariffs, and economic uncertainty, according to the National Association of Home Builders (NAHB). Home builder sentiment, as measured by the NAHB/Wells Fargo Housing Market Index (HMI), rose one point to 39 in December 2025. Any HMI reading over 50 indicates that more builders see conditions as good than poor. Builder confidence readings remained below 50 for every month in 2025 and were in the high 30s in the fourth quarter. The HMI survey also showed that 40% of builders reduced home prices in December to lure potential buyers off the sidelines, and the average price reduction was 5%, down one percentage point from November.
• Demand for building design services declined in November from the prior month, marking the thirteenth consecutive month of weak architectural billings, according to a December report by the American Institute of Architects (AIA). The AIA’s Architecture Billing Index (ABI) fell to 45.3 compared to October's reading of 47.6. Any reading of 50 or more indicates growth in architectural billings. The score for new project inquiries fell to 51.4 in November from 54.8 in October, and the new design contracts index dropped to 42.7 from 47.1. The AIA’s Chief Economist, Kermit Baker said, "Weakness in business conditions at architecture firms continues to be widespread, with declining billings across all major specializations and in every region except the Midwest. However, inquiries for new projects continued to increase, and design activity at firms in the Midwest – a region that traditionally has had a disproportionate share of manufacturing activity – appears to have hit its bottom for this cycle and is expected to continue to improve."

• The total value of nonresidential building construction starts in November fell 13.4% compared to October, according to Dodge Construction Network. Commercial starts declined 25.8. Office and data center starts dropped 40.5% and hotels were down 33.2%. Nonresidential building segments that posted growth in November included parking garages (+32.1%), retail stores (+8.3%), and warehouses (+6.4%). Institutional starts grew 11.4% as gains in public and educational building starts offset declines in amusement and dormitory starts. Manufacturing starts remained volatile in November, declining 50.7% from October levels.
• Home remodeling spending is expected to remain stable 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.