Remodeling Is Stalling: What a Frozen Housing Market Means for Costs
Harvard's latest remodeling outlook points to sluggish spending. Here is what that means for your quotes on kitchens, baths, roofs and more.
Remodeling spending is growing only slowly, and the outlook is flat. For homeowners, that mostly means contractors may be easier to book, but it does not mean prices are about to fall.
What happened
According to themortgagepoint.com, the latest Leading Indicator of Remodeling Activity from Harvard's Joint Center for Housing Studies puts year-over-year growth in renovation and repair spending at 1.5% by the third quarter. The Joint Center expects annual spending to hover around $525 billion through the third quarter of next year.
The report describes a housing market in a deep freeze. High interest rates, high home prices and weak consumer sentiment are holding back the moves that usually trigger remodels. At the same time, people who can't or won't sell tend to renovate instead. The two forces pull against each other.
Other indicators in the report point the same way:
- Retail spending on building products has been flat to negative, and remodeling permits have stagnated.
- September single-family housing starts and building permits came in well below expectations.
- Pending home sales, measured by signed contracts, fell more than expected.
A separate October survey from the National Association of Home Builders found remodeler sentiment stable. Remodelers in some regions still report high material costs and trouble finding enough labor. Some also say economic uncertainty makes customers hesitant. A Houzz report showed construction pros with their highest expectations since early 2022, though design firms were more cautious. Houzz also noted that fuel costs are a pressure point: some pros pass them on through higher prices or surcharges, while others absorb them.
What it means for your project cost
Weak demand can help you on scheduling and negotiation. It does not remove the cost pressures the report describes: materials, labor availability and fuel. Expect the following.
- Prices: roughly steady, not falling. Contractors still face the same material and labor costs. Fuel surcharges are worth asking about up front, especially on jobs with heavy hauling or equipment.
- Availability: better. With softer demand, you may get quicker start dates and more bids to compare.
- Timing: no rush from the market. The big federal tax credits, 25C and 25D, ended for 2026, so there is no credit deadline to chase. Check your state and utility programs instead. The DSIRE database lists them, and some states run IRA home energy rebate programs.
Where our figures stand
Our live model currently puts a typical mid-range kitchen remodel at $12,000, with a range of $9,350 – $15,600. A typical bathroom remodel comes in at $13,600 ($10,600 – $17,600). Roof replacement with shingles is typically $8,500, and a ducted heat pump installation $14,500. All figures are before sales tax.
We build these by combining labour hours at local rates with materials, then checking them against market prices and real quotes. See our full guides for [kitchens](Kitchen remodel), [bathrooms](Bathroom remodel) and [roofs](Roof replacement).
Big-ticket energy jobs follow the same logic. Solar panels typically cost $24,600 ($19,200 – $32,000) and, with the federal credit gone, the decision rests on your own savings. See the [solar guide](Solar panels) for detail.
How to use a soft market
- Get three or more quotes. Contractors with open calendars are more willing to price sharply.
- Ask about surcharges. Get fuel or material surcharges in writing before you sign.
- Compare line by line. Check labor, materials and permits separately. Plumbing, electrical and structural work usually needs a local permit.
- Run your quote through our checker. Our "is my quote fair" tool compares what you've been offered with our live figures.
- Don't wait for a price drop. The report points to flat activity, not falling costs. If a repair is urgent, such as a leaking roof, delay usually costs more than it saves.
Bottom line
A frozen housing market means fewer homeowners are renovating, and contractors may have more room in their schedules. But the cost pressures the report highlights are still there. Treat a slow market as a chance to compare bids and negotiate terms, not as a signal that prices will drop.