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Remodeling spending was flat on average across states in the second quarter of 2026, according to the National Association of Home Builders’ State Projections of Remodeling. Spending declined in 26 states and increased in 24, while only North Carolina and Illinois among the 10 largest remodeling markets recorded growth. NAHB cited construction costs and weak consumer sentiment as pressures, but said longer-term demand could be supported by aging homes and other factors.
Remodeling spending was flat on average across U.S. states in the second quarter of 2026, according to the National Association of Home Builders’ State Projections of Remodeling, as the sector faced a broader housing slowdown. The estimates show spending fell in 26 states and rose in 24, with only North Carolina and Illinois posting growth among the 10 states with the largest remodeling market shares.
The NAHB’s State Projections of Remodeling (SPR) reported an average state growth rate of 0.0% for the quarter. That average reflects a near-even division between states where remodeling spending declined and those where it increased; it does not mean spending was unchanged in every state. The report did not provide state-level growth rates in the supplied material.
NAHB Chief Economist Robert Dietz said the pattern was consistent with the association’s forecast for remodeling spending in 2026. He said second-quarter growth was concentrated in smaller states and that, among the 10 states with the largest shares of the remodeling market, North Carolina and Illinois were the only ones to record growth.
The SPR estimates quarterly remodeling spending and market share for each state using a proprietary NAHB statistical model. The model combines national quarterly home-improvement spending data, state-level indicators and the association’s annual state remodeling forecast. The figures are estimates produced by that model, rather than a direct count of project spending.
Flat Spending Meets Persistent Project Costs
The flat average offers a snapshot of a remodeling market that is holding close to even overall but varying by state. For homeowners planning projects, the results point to a mixed environment rather than uniform growth: spending gains occurred in 24 states, while 26 recorded declines. The supplied report does not identify the size of those changes or explain how they affected individual projects.
NAHB Remodelers Chairman Elliott Pike attributed pressure on activity to rising construction costs and weak consumer sentiment. Those factors, he said, are weighing on projects and keeping spending flat. If costs remain high or households remain cautious, some owners may delay or scale back work; the report does not quantify how many projects were postponed.
The results also matter to contractors and building-material retailers because remodeling is a substantial part of residential construction. NAHB said remodeling accounts for a growing share of residential construction by both the number of firms and total construction spending. A flat quarter does not establish a longer-term decline, but it signals that current demand is not expanding evenly across states.
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NAHB Sees Long-Term Demand Drivers
The Q2 figures sit alongside signs of steadier industry confidence. NAHB’s Remodeling Market Index, which measures confidence in the sector, remained above 60 for the past year, according to the report. That measure reflects remodeler confidence and is separate from the SPR’s estimates of spending; the two indicators describe different aspects of the market.
NAHB expects remodeling to grow in the years ahead, citing home-equity gains that may help owners pay for projects. Pike also pointed to the age of the U.S. housing stock, the mortgage-rate lock-in effect and more homeowners choosing to age in place as potential sources of future demand. These are factors the association says could support growth, not guarantees that spending will rise.
The industry’s business base has also expanded over time. NAHB reported that the number of remodeling firms stood at 128,000 at the start of 2025, compared with 69,000 in 2000. That longer-term increase provides context for the sector’s role, but it does not show how many firms were active or how much they earned during Q2 2026.
State-Level Changes Need More Detail
The supplied report gives the number of states with rising and falling spending and the average growth rate, but not the size of each state’s change, state-by-state spending totals or the overall national dollar value for the quarter. It is therefore not possible from these figures alone to determine whether the increases and declines were similar in scale or how the state estimates combined into a national total.
The report also does not quantify the effect of construction costs or consumer sentiment on project decisions, nor does it specify how the Q2 estimates compare with the same quarter in 2025. The SPR’s results are model-based estimates, and the supplied material does not provide uncertainty ranges or further methodological detail. The index staying above 60 indicates continued confidence by its measure, but does not establish that spending will accelerate.
Watch Future Spending Estimates
The next relevant signal will be subsequent NAHB remodeling estimates and updates to the association’s forecast. Those releases can show whether the near-even state split continues, whether more large remodeling markets return to growth and whether the national average moves away from zero.
For now, NAHB’s stated outlook is for remodeling to grow in the years ahead, supported by factors such as home equity and demand for homes that accommodate aging in place. That remains a forecast; the Q2 report confirms flat average growth for the quarter, not a future rebound. The supplied material does not give a date for the next SPR release.
Key Questions
Was remodeling spending unchanged in every state in Q2 2026?
No. The 0.0% figure is the average growth rate across states. Spending declined in 26 states and increased in 24, according to NAHB’s estimates.
Which of the largest remodeling markets recorded growth?
Among the 10 states with the largest remodeling market shares, NAHB Chief Economist Robert Dietz said only North Carolina and Illinois recorded growth. The supplied report does not give their growth rates.
What factors did NAHB cite as weighing on remodeling activity?
NAHB Remodelers Chairman Elliott Pike cited rising construction costs and weak consumer sentiment as pressures on projects and spending.
Why does NAHB expect remodeling to grow over the longer term?
The association points to home-equity gains, an aging housing stock, mortgage-rate lock-in and more homeowners choosing to age in place as factors that could support demand. This is an outlook, not a guarantee of growth.
Source: hardwareretailing.com
