2025 Residential Remodeling Outlook: A Strong Market with High Demand

The home renovation sector is flourishing, maintaining the robust expansion observed in previous years.  Homeowners across the country are putting money into homes, emphasizing both functional enhancements and fashionable changes.

Projected spending on home improvements are expected to surpass $1.2 trillion, indicating strong demand, fueled by economic conditions, changing lifestyle requirements, and a growing desire for eco-friendly, personalized living environments

2025 Remodeling Industry Forecast: Key Trends & Insights

Kitchen renovations make up for thirty eight percent of all home improvement projects, and 26% of homeowners plan to update their bathrooms.

• 17% of homeowners are expanding homes with additions like guest suites and multi-generational living spaces. 

• 20% of remodeling projects will be on outdoor living enhancements, reflecting the growing trend of creating functional, comfortable exterior spaces.

• 14% of home improvements will prioritize energy efficiency, with upgrades like solar panels, new windows, insulation, and eco-friendly appliances.

• 11% of homeowners are investing in storage and organization solutions, like finishing basements or turning attics into usable spaces.

Key Factors Driving Home Renovations in 2025

Efficiency and Sustainability: 

Rising utility costs and environmental awareness are causing homeowners to invest in energy efficient solutions, including improved insulation, solar power, and high-efficiency appliances.

Remote Work and Home Offices: 

With hybrid work remaining a standard practice, many homeowners are creating dedicated office spaces to enhance productivity and comfort.

Aging in Place: 

As more people plan to stay in their homes long-term, renovations featuring accessibility improvements (wider doorways, ramps, barrier-free showers) are becoming more common.

Multi-Generational Living & In-Law Suites: 

The need for additional space to accommodate extended family is driving a rise in home additions and separate living areas.

Home Value Appreciation: 

While property values increase and housing inventory stays low, homeowners choosing to renovate their existing homes rather than relocate, boosting both utility and resale value.

Why 2025 is a Great Year to Renovate

In spite of economic ups and downs, 2025 is looking to be a hopeful year for home improvements. The renovation sector is experiencing increased stability, especially regarding the availability and prices of materials. Lumber prices have stabilized, and numerous building materials are at their lowest prices since prior to 2020.

This makes home improvement tasks more accessible and budget-conscious, enabling homeowners to proceed with assurance, fewer setbacks, and enhanced financial management.