A growing number of homeowners are postponing renovation projects due to elevated material and labor costs, raising concerns about weakening demand in the home improvement sector. The trend could signal broader consumer caution affecting construction materials and residential real estate markets.
- Over 58% of homeowners are delaying renovations due to high material and labor costs
- Average kitchen renovation cost reached $43,700 (+12% YoY)
- Bathroom upgrade costs now average $29,500 (+9% YoY)
- Lowe’s (LOW), Home Depot (HD), and RYAM report declining discretionary product sales
- Construction materials manufacturers see reduced order volumes
- Consumer hesitation may constrain growth in home improvement and building supply sectors
Homeowners across major U.S. metropolitan areas are increasingly deferring renovation plans as cost pressures persist. According to recent survey data, over 58% of respondents cited rising expenses—particularly for materials like lumber, drywall, and HVAC systems—as the primary reason for delaying projects. This shift reflects a broader economic hesitation, especially among middle-income households balancing mortgage payments and inflation-related spending. The average cost of a mid-sized kitchen renovation has climbed to $43,700, up 12% year-over-year, while bathroom upgrades now average $29,500—a 9% increase. These figures underscore the financial strain on consumers despite steady home values. Firms such as Lowe’s (LOW), Home Depot (HD), and regional suppliers like RYAM are seeing slower sales growth in discretionary improvement categories, with some retailers reporting a 7% decline in related product volume during Q4 2025. Market analysts suggest that the delay in renovation activity may be contributing to a softening in demand for construction materials. Steel, insulation, and flooring manufacturers have reported lower order volumes, indicating reduced downstream activity. This sluggishness could influence capital expenditure planning for building supply chains and impact employment in trade sectors tied to residential construction. For investors monitoring housing-related equities, the trend highlights an emerging risk: prolonged consumer hesitation may dampen growth in home improvement retail and associated manufacturing segments. While home prices remain elevated, the disconnect between property value appreciation and renovation affordability could limit upside potential in the residential construction cycle.