In 2025, nearly four in ten homeowners (37%) who set a renovation budget spent over budget, primarily due to unexpected increases in product and service costs, according to Hardware Retailing. Homeowners are absorbing higher prices for essential projects, often beyond initial expectations.
Home renovation activity remains robust with high homeowner intent, but the underlying motivation is shifting towards essential repairs and homeowners are consistently spending more than planned. Although 50% of homeowners plan renovations for 2026 with an intended median spend of $15,000, this follows 2025 where 54% of U.S. homeowners undertook projects with a median spend of $20,000, as reported by Hardware Retailing. Homeowners are planning more conservatively for 2026, perhaps in response to 2025's overruns. Additionally, 71% of homeowners plan a renovation project within the next two years, according to HousingWire.
Homeowners will likely continue to prioritize functional improvements, driving steady demand for basic materials and services, while facing ongoing financial strain from rising project costs. This outlook creates a persistent challenge for consumers navigating the 2026 home renovation market.
Necessity Drives Renovations, Budgets Strain
- Sixty-four percent of homeowners are focusing on necessary repairs or replacements for renovations, while 17% are pursuing discretionary upgrades, according to HousingWire.
- Thirty-seven percent of homeowners who set renovation budgets spent over budget in 2025, primarily due to costlier products and services, as reported by Hardware Retailing.
- The median renovation spend was $20,000 in 2025, according to Hardware Retailing.
Essential projects dominate the renovation landscape. Homeowners are not just spending, but often overspending, on repairs they cannot avoid. This creates a clear financial disconnect: homeowners are forced to invest significantly in upkeep, often exceeding their initial financial plans, which suggests a market driven by need rather than choice.
