Harvard's Joint Center projects homeowners will spend $527 billion on improvements and repairs in the year to September 2027, up 1.5%

Tue, 27 Oct 2026 08:38:52 -0400

The Joint Center for Housing Studies of Harvard University projects that American homeowners will spend $527 billion on improvements and repairs in the four quarters ending in September 2027, 1.5% more than in the four quarters before. The projection comes from the Leading Indicator of Remodeling Activity, or LIRA, a quarterly forecast that the Joint Center’s Remodeling Futures Program released on October 22, 2026. The Joint Center estimates spending in the four quarters through September 2026 at $519.7 billion, up 2.1% on the year before.

The LIRA counts spending on owner-occupied homes, both work done by professionals and work owners do themselves. The Joint Center reports each quarter as a four-quarter moving total, the sum of that quarter and the three before it, so the figure for the fourth quarter of a year equals spending for that calendar year.

Homeowner remodeling spending has stayed between $501 billion and $522 billion since late 2022

U.S. homeowner improvement and repair spending, four-quarter moving total, billions of dollars, not adjusted for inflation, by the last month of each quarter

Estimates since 2023 come from the LIRA model. October 2026 through September 2027 are projections. Source: jchs.harvard.edu

Homeowner improvement and repair spending, four-quarter moving total, from the October 22, 2026 LIRA release.
Four quarters ending	Spending ($ billions)	Change on year (%)	Status
2025 Q3	508.7	1.5%	Estimate
2025 Q4	512.3	1.7%	Estimate
2026 Q1	522.0	1.7%	Estimate
2026 Q2	518.4	1.8%	Estimate
2026 Q3	519.7	2.1%	Estimate
2026 Q4	524.4	2.4%	Projection
2027 Q1	524.6	0.5%	Projection
2027 Q2	521.6	0.6%	Projection
2027 Q3	527.4	1.5%	Projection

Source: jchs.harvard.edu

Four years near the same level

By the Joint Center’s estimates, homeowner spending on improvements and repairs rose from $277.3 billion in the four quarters ending March 2016 to $515.9 billion in the four quarters ending December 2022. Since then it has stayed in a narrow range, from a low of $501.2 billion in the four quarters through September 2024 to a high of $522.0 billion in the four quarters through March 2026. The latest estimate, $519.7 billion, is 0.7% above the level at the end of 2022.

The annual rate of change shows the same turn. Growth peaked at 26.3% in the four quarters ending December 2022, fell below zero by the end of 2023 and bottomed at minus 2.5% in the third quarter of 2024. It has been positive since the second quarter of 2025. The Joint Center projects 2.4% for the four quarters ending December 2026, then 0.5% and 0.6% in the first two quarters of 2027 and 1.5% in the third.

Growth in remodeling spending is projected to slow to 0.5% early in 2027

Change in the four-quarter moving total of U.S. homeowner improvement and repair spending on the same period a year earlier, percent

October 2026 through September 2027 are projections. Source: jchs.harvard.edu

What the Joint Center says is driving it

Rachel Bogardus Drew, who directs the Remodeling Futures Program, pointed in the release to the two inputs most tied to renovation work: “Retail spending on building products has been flat to negative, and remodeling permits have stagnated, which points to continued sluggish renovation activity.” Chris Herbert, the Joint Center’s managing director, said housing starts continue to decline and the wider housing market remains weak, and that these conditions could slow growth in remodeling spending further.

The October projection is a little higher than the one the Joint Center published on July 23, 2026. That release projected growth of 0.5% and spending of $519 billion for the four quarters ending June 2027. The new release puts the same period at 0.6% and $521.6 billion. Both releases put growth for the four quarters through September 2026 at 2.1%. The Joint Center also notes that the Census Bureau re-benchmarked its monthly retail sales estimates in September 2026, which changed some LIRA spending estimates back to 2018 by less than 1%.

The July and October 2026 LIRA releases compared. The July figures for 2026 Q3 and 2027 Q2 were projections; in October, 2026 Q3 is an estimate.
Measure	July 2026 release	October 2026 release
Change on year in the four quarters to 2026 Q3 (%)	2.1	2.1
Change on year in the four quarters to 2027 Q2 (%)	0.5	0.6
Spending in the four quarters to 2027 Q2 ($ billions)	519	521.6

Source: jchs.harvard.edu

How the forecast is built

A leading indicator is a figure that tends to move a few months before the thing it predicts. The LIRA combines eight of them in two models, one for improvements and one for maintenance and repair. Each input gets a weight and a lead time, the number of quarters by which it has tended to run ahead of spending. The improvement model leans most on retail sales of building materials, at 19.6% of its weight. The maintenance model leans most on gross domestic product, at 32.3%. The Joint Center publishes only the combined result of the two models.

Inputs to the LIRA models, with the lead over spending and the weight the Joint Center assigns to each. Weights are rounded and may not sum to 100.
Model	Indicator	Published by	Lead (quarters)	Weight (%)
Improvements	Retail sales of building materials	US Census Bureau	1	19.6%
Improvements	Leading Economic Index	The Conference Board	1	18.9%
Improvements	National home price index	S&P CoreLogic Case-Shiller	1	17.8%
Improvements	Residential remodeling permits	Verisk (BuildFax)	4	16.7%
Improvements	Existing single-family home sales	National Association of Realtors	5	14.8%
Improvements	Single-family housing starts	US Census Bureau	4	12.1%
Maintenance and repair	Gross domestic product	US Bureau of Economic Analysis	2	32.3%
Maintenance and repair	Median sales price of existing single-family homes	National Association of Realtors	4	19.2%
Maintenance and repair	Retail sales of building materials	US Census Bureau	5	18.5%
Maintenance and repair	Leading Economic Index	The Conference Board	3	16.2%
Maintenance and repair	Existing single-family home sales	National Association of Realtors	6	13.7%

Source: jchs.harvard.edu

The Joint Center says every LIRA input and output is nominal, which means in current dollars with no adjustment for inflation. The Bureau of Labor Statistics Producer Price Index for goods that go into residential maintenance and repair stood at 342.798 in September 2026, 9.7% above September 2025. The two series measure different things. The LIRA counts what homeowners spend, and the index tracks what producers charge for the goods used in the work. If a contractor’s materials costs move with that index, a budget that grew about 2% in a year buys less material than it did a year earlier.

What this means for a remodel here

A flat national total says little about how busy the contractors you call will be in Conshohocken or Plymouth this winter. Ask each one when they could start and how long the job would take, and compare the answers. The county’s permit counts in our look at Montgomery County building permits give a local view of new construction.

Materials prices can move between the day you get a quote and the day work starts. Ask how many days the prices in a quote hold, and whether the contract has a price adjustment clause. If it ties the price to a Producer Price Index, the BLS guide to such clauses notes that the indexes can be revised for up to four months after first publication, so ask which month’s figure the clause uses and whether a later revision changes the bill. The guide to remodeling costs covers how to read the materials lines in a quote, and the guide to change orders and payment schedules covers how a price change should be written into the contract.

Caveats

The LIRA is a national forecast for owner-occupied homes. It leaves out remodeling and repair of rental units, so it says nothing direct about spending by landlords. The forecast covers the country as a whole. For regional figures, the Joint Center points to the tables of its biennial report, Improving America’s Housing, which cover past years.

The figures since 2023 are themselves model estimates. The Joint Center benchmarks the LIRA to the American Housing Survey, a federal survey run every two years, and replaces the model’s estimates once new survey data come in. Projections change each quarter, as the July and October releases show. The next release is scheduled for January 21, 2027.

The BLS price index figure for September 2026 is preliminary. BLS can revise it, along with the figures for June through August, for up to four months after first publication.

Remodeling spending | Conshy Contractor

Harvard's Joint Center projects homeowners will spend $527 billion on improvements and repairs in the year to September 2027, up 1.5%

Four years near the same level

What the Joint Center says is driving it

How the forecast is built

What this means for a remodel here

Caveats