Home improvement activity has been off to a slower start in 2026, with fewer households engaging, project scope narrowing, and projects shifting toward necessity-driven work.
These trends point toward a contraction in overall market participation and a move away from multi-phase renovations toward smaller, more targeted projects with tighter budgets and defined outcomes. Financial concerns and uncertainty about the economy are more frequently keeping homeowners on the sidelines or causing them to defer projects for the time being, based on findings in HIRI’s quarterly Home Improvement Project Activity Tracker.
It’s important for manufacturers and suppliers to be aware of these behaviors and the challenges facing homeowners if they hope to grow their share of a tight market. Additionally, the report provides quarter-over-quarter data and insights into how much homeowners are spending on projects (and intend to spend in the coming months), as well as their preferred shopping channels, research methods, and sentiment toward home improvement activity.
In the first quarter of 2026, home improvement activity declined to its lowest point in five quarters, as fewer households engaged. Only 40% of homeowners completed a home improvement project in Q1 2026, down from 44% in Q1 2025. The pullback is mostly found for discretionary renovation projects, while maintenance and repair projects have held firm.
Here is a look at what types of projects homeowners completed in Q1 2026:
These trends point toward a slight contraction in overall market participation rather than weakening demand drivers, with more homeowners remaining on the sidelines despite stable underlying need for repair and improvement.
Households are currently prioritizing essential work, with home improvement moderating between necessity and discretion. Project mix has shifted further toward necessity-driven work, as discretionary renovations continue to soften, reinforcing a market where essential repair and systems projects persist while more elective, design-oriented upgrades are increasingly deferred. As of Q1 2026, the main residential areas or systems where homeowners recently conducted projects include:
Another statistic that gives insight into how homeowners are feeling about improvement is that, in Q1 2026, 62% chose to repair something in their home instead of replacing it, compared to 51% in Q4 2025. Looking ahead, project demand among homeowners will reportedly be focused on:
In examining what is driving homeowners to pursue projects, HIRI’s research shows that the motivation of maintain and repair, while still the top driver, has decreased significantly. Meanwhile, improvement activity reflects a broader mix of life changes and situational project drivers. The main motivations for home improvement activities in Q1 2026 were to:
There also has been a notable increase in health and well being as a driver, jumping to 12% in Q1 2026 compared to 4% in Q1 2025, while aging in place/mobility dropped to 7% in Q1 2026 compared to 15% in Q1 2025.
Households are prioritizing essential spending, with home improvement moderating as it sits between necessity and discretion. At the same time, concern is shifting toward lived cost pressures, particularly housing affordability.
Based on findings in HIRI's Quarterly Homeowner Project Activity Tracker, overall, the average spending per project increased in Q1 of 2026, even as fewer homeowners participated in home improvement activities. Among those who did complete projects, average spending reached $5,368, up from $3,957 in Q1 2025. The exact causes of the increased spending could be multi-faceted.
At the same time, cash payments declined to 51% (from 58% the prior year) as credit card use climbed to 30% (compared to 25% in Q1 2025). As cost pressures intensify, it seems to be driving increased reliance on financing and reducing the ability to self-fund projects.
Most of the spending in Q1 2026 was concentrated in major renovations and systems, while exterior and outdoor projects had more moderate investments levels. The average project spend in this period was:
Looking ahead, about 42% of homeowners are planning to spend the same on home improvement activities as they did in 2025. Roughly 29% plan to spend less and 29% plan to spend more. These intentions mostly mirror those in Q1 2025, although the percentage of homeowners who plan to spend less jumped from 19% to 29% between Q4 2025 and Q1 2026. In terms of how much homeowners anticipate spending on home improvement projects in the future, expectations reported by homeowners in HIRI's studies are:
The top concerns among homeowners have remained relatively consistent among homeowners over the past year, with the economy being the primary one, cited by 55% of homeowners. Other concerns reported in Q1 2026 include:
Notably, housing affordability has risen sharply as a household pressure, jumping to 16% compared to 6% in Q1 2025. Concerns surrounding tariffs has declined to 14% compared to 23% in Q4 2024. Additionally, general uncertainty about the economy is underpinning other financials concerns, even though real income (or inflation-adjusted) is flat to slightly positive to start 2026. For industry professionals, the economy, inflation and personal finances are also among top concerns. They are significantly less concerned about the political environment than homeowners, cited by only 15% of professionals. However, they are more concerned about housing affordability (26%) and tariffs (22%) than homeowners.
Budget pressures are driving a wave of project delays and cancellations. In Q1 2026, 32% of homeowners postponed a project and 5% canceled. Among those, 72% cited budget or financial reasons, which is a statistically significant increase over Q1 2025. Interest rates also have delayed about one-third of home improvement projects in the past year.Even those who’ve completed home improvement activities recently are feeling financial pressures. About 43% cited cost of the project as a challenge during their project, up from 30% in Q1 2025. Additionally, about 24% of homeowners have a home improvement project they desire but haven’t started, and another 49% have more than one. Affordability is the primary barrier, with demand contingent on improved financial conditions, rather than timing or execution factors.
In terms of how homeowners are feeling about taking on new home improvement activities, smaller projects maintain the most appeal, while sentiment toward larger projects and contractor hiring remains subdued. For projects that will cost $5,000 or less:
For projects in the $5k to $25k range:
For projects in the $25k-plus range:
In terms of hiring a contractor:
With only 21% of homeowners viewing now as a good time to hire a professional, and sentiment around larger projects remaining deeply subdued, cost is a primary barrier to activity. For manufacturers and suppliers, it’s important to focus on value offerings and smaller projects, while aligning pricing and financing to address affordability and constrained household income.
In terms of whether homeowners are doing more DIY or hiring contractors for home renovations, HIRI's research shows that pure DIY continues to decline. Homeowners are increasingly combining self-performed work with contractor support, balancing cost control with the need for expertise as projects grow more complex and harder to execute independently. In Q1 2026, the completion methods for home improvement projects were as follows:
The reasons for using a DIY approach have remained mostly consistent over the past year, with the three reasons being:
The reasons why homeowners choose to hire a professional include:
HIRI’s Quarterly U.S. Homeowner Project Activity Tracker has also started including speed or convenience as a motivation for DIY and project size/complexity as a motivation for hiring a professional, so there will be more insight into these potential drivers of project completion methods in coming iterations of the report.
Product purchasing in Q1 2026 indicates a narrowing of project scope, with softening in interior work and only modest resilience in exterior categories. Professionals drive complex, multi-category projects, while homeowners focus on more contained and targeted elective improvements. The categories where product purchases were made during this period include:
Over the past five quarters, price and quality have taken turns being the main priority when selecting home improvement products, although they together maintain the top two spots, followed closely by durability. The next tier of factors considered when making a decision include:
Channel mix remains relatively stable, with only modest share shifts at the margins, rather than meaningful channel disruption. In-store purchases are continuously more common among homeowners completing projects than online purchases.The main channels used for home improvement products purchases in Q1 2026 were:
Some of these options were modified or added in Q1 2026 (including nursery or garden supply center and farm or tool-focused retailer), which limits direct comparability to prior quarters.There are some variations among pros and homeowners when it comes to preferred shopping channels. While both utilize big-box retailers the most, professionals rely on a broader, trade-focused supply network. They are especially more likely to make purchases at:
In general, research activity has broadened, signaling more early-stage exploration, even as project follow-through remains more limited. The sources that homeowners used to conduct research in Q1 2026 include:
Social media platforms primarily support inspiration, particularly for projects, while retailer and brand ecosystems guide more intentional evaluation of home improvement products. Emerging tools, such as generative AI, show limited but recent use, which indicates growing experimentation. Manufacturers and suppliers should consider integration across retail and digital touchpoints, capturing early-stage engagement while reinforcing store-centric purchase pathways and testing AI-driven discovery tools.
Understanding the dynamic landscape of home improvement is crucial for businesses and researchers alike. HIRI’s quarterly Home Improvement Project Activity Tracker is designed to gain insight into homeowners’ current attitudes and motivations driving home improvement initiatives, shedding light on the recent activities they have undertaken within the last 90 days and planned activities in the next 90 days. You will see detail on project activity by areas of the home, product categories purchased, where products were purchased and more. Become a member of HIRI to download the full report. Members also gain access to roughly $1 million in other home improvement specific research annually for a membership cost that is less than 2% of that total value, making HIRI one of the most cost-efficient ways to power smarter decision-making across your organization.
About 42% of homeowners are planning to spend the same on home improvement activities in 2026 as they did in 2025. Roughly 29% plan to spend less and 29% plan to spend more. Additionally, homeowners expect to spend, on average, approximately $2,194 over the next three months and $6,726 over the next 12 months.
HIRI’s research shows that pure DIY continues to decline. In comparison, homeowners are increasingly combining self-performed work with contractor support, balancing cost control with the need for expertise as projects grow more complex and harder to execute independently. In Q1 2026, the completion methods for home improvement projects were 39% DIY, including non-paid help; 46% a combination of both DIY and contractor assistance; and 15% using a contractor. The top reasons why homeowners choose to hire a professional include: technical expertise (61%); work quality (54%); guaranteed workmanship (43%); and specialized tools/equipment (43%).
In-store purchases continue to be more common among homeowners completing home improvement projects than online purchases. Based on HIRI’s research, the main channels used for home improvement products purchases in Q1 2026 were big-box retailers (66%); hardware stores (29%); online-only retailers (24%); mass retailers (22%); lumber yard/building material dealers (15%); specialty suppliers (15%); nursery or garden supply center (12%); farm or tool-focused retailers (10%); direct from manufacturer (9%); and warehouse clubs (8%). There are some variations among pros and homeowners when it comes to preferred shopping channel. While both utilize big-box retailers the most, professionals relay on a broader, trade-focused supply network.
The main challenge that homeowners are currently facing with home improvement projects are rising costs. Budget pressures are driving a wave of project delays and cancellations. In Q1 2026, 32% of homeowners postponed a project and 5% canceled. Among those, 72% cited budget or financial reasons, which is a statistically significant increase over Q1 2025. Even those who’ve completed home improvement activities recently are feeling financial pressures. About 43% cited cost of the project as a challenge during their project, up from 30% in Q1 2025.