The remodeling market is poised for growth in the coming years as many structural tailwinds, including an aging housing stock, the persistent lock-in effect and the trend for older home owners to age-in-place, will not be changing quickly, according to industry experts at a panel hosted by the National Association of Home Builders (NAHB) during the International Builders’ Show in Orlando. 

This positive outlook is reflected in the NAHB/Westlake Royal Remodeling Market Index (RMI), a quarterly survey of NAHB remodeler members that provides insight for the remodeling industry. In fact, the RMI has registered a reading above the break-even point of 50 for 24 consecutive quarters, showcasing a post-pandemic resiliency. The remodeling sector is also outpacing the single-family and multifamily housing markets when comparing their respective sentiment measurements over the past five years. 

“There are many factors contributing to the continued growth of the remodeling market, including the aging housing stock,” said NAHB Economist Eric Lynch. “The typical age of a home has increased from 31 years old in 2006 to 41 years old in 2023. And with the dramatic rise in home equity post-pandemic, more home owners are able to finance remodeling projects that align with their needs.” 

Another tailwind for the remodeling market is the mortgage rate lock-in effect, where home owners with low mortgage rates have chosen to stay in their current homes instead of moving and taking on a higher rate. Lynch noted that while the lock-in effect is lessening, it is still persisting which means households will be incentivized to pursue remodeling projects first before considering a sale. 

Lynch explained that the remodeling sector is continuing to become a larger share of the residential construction market, especially when looking at the number of firms and overall construction spending. There were 128,000 remodeling firms at the start of 2025, up from 69,000 in 2000. And home improvement spending share increased from 33% in 2007 to 44% in the first quarter of 2025. 

The trend for older home owners to age-in-place has positively contributed to the growth in the remodeling market. The RMI survey showed that 56% of remodelers are involved in home modification work relating to aging-in-place and that 96% of remodelers said that most or some of their consumers are familiar with the aging-in-place concept. The survey also showed that 73% of respondents indicated that requests for aging-in-place features have significantly or somewhat increased over the past five years. 

A recent RMI survey found that the most common remodeling projects in 2025 were: bathroom remodels, kitchen remodels and whole house remodels. These findings are consistent with historical trends reported by NAHB where bathroom, kitchen and whole house renovations have traditionally ranked as the top three project types undertaken by NAHB remodelers. 

Looking ahead, residential remodeling activity is expected to increase 3% in 2026 and an additional 2% in 2027 in inflation-adjusted terms. “NAHB is forecasting growth for the remodeling sector both in the short-term and the long run, driven by these structural tailwinds that are not expected to change in the near future,” said Lynch. 

Attendees also heard from Alan Hanbury, Jr., CGR, CAPS, GMR, president and CEO of Consulting by House of Hanbury Builders Inc., based in Newington, Conn., who presented on best practices for setting KPIs for remodelers to grow and manage their businesses profitably. 

For remodelers, a few best practices stand out in ensuring sustained success. “It is extremely important for remodelers to establish benchmarks and target attainable future goals if they want to continue to succeed and grow,” said Hanbury. “It is even better when those objectives are based on data from your fellow peers.” 

This type of data can be found in NAHB’s Remodelers’ Cost of Doing Business Study, where remodelers can compare their current performance against the industry, broken down between top 25%, bottom 25% and average outcomes. The study shows gross and net profit, assets and liabilities, owners’ equity and financial ratios, among many other indicators broken down between design build firms and general remodelers as well as revenues. 

“Every remodeling business is unique, so understanding the differences among various groups of remodelers is crucial for making the most appropriate benchmarks for your company,” said Hanbury. “It is also essential to know the most important financial ratios used for benchmarking and how they are calculated so your comparisons are legitmate.”