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Americans took on remodeling or DIY home projects in record numbers throughout the pandemic, but amid soaring inflation and growing recession fears, homeowners are becoming less willing to take on costly home improvement projects in 2023. Recent data shows home improvement giants such as Lowe’s and The Home Depot are posting lower profits and downgrading their sales outlooks for the year, the National Association of Realtors reports.
While renovation projects are slowing, experts say the pullback may not last long, especially as rising borrowing costs force homeowners to stay put and upgrade their existing homes rather than entering a volatile for-sale market as buyers.
As home sales remain slow this spring, there may be fewer new homeowners to make these remodeling changes—at least for now, says Jessica Lautz, deputy chief economist and vice president of research at the National Association of REALTORS.
She views the remodeling slowdown as short-lived because homeowners who locked in lower mortgage rates in recent years are likely to stay put rather than trade up at a higher rate. “As these homeowners stay put, they may need to invest in improvements or want to reimagine their space to fit their changing needs,” Lautz adds.
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