Remodeling spending stays flat, Harvard forecast says

The forecast has year-over-year growth easing from 2.4% in the fourth quarter of 2026 to 1.5% in the third quarter of 2027. Spending over rolling four-quarter periods moves only from $524 billion to $527 billion across that stretch, according to the center's chart. The index is not adjusted for inflation, the center says, so the growth is in current dollars.

Rachel Bogardus Drew, who directs the center's Remodeling Futures Program, said building-product sales at retail are flat or falling, while remodeling permits have stalled. Managing director Chris Herbert pointed to falling housing starts and a weak housing market, and said growth in remodeling spending could slow further in the coming quarters.

The indicator, known as LIRA, covers owner-occupied homes only, so work on rental properties is not counted. It combines eight inputs, among them retail sales at building-materials dealers, existing-home sales, single-family starts, home prices and BuildFax remodeling permit counts, and looks four quarters ahead. It does not break out regions or project types. In September the Census Bureau revised its monthly retail sales data, which shifted some LIRA estimates since 2018, each by under 1%, the center said. The next release is scheduled for Jan. 21, 2027.