Hardware Retailing The Industry's Source for Insights and Information
Houzz Inc. recently released its Q4 2025 Houzz U.S. Renovation Barometer, revealing strengthened optimism among construction professionals following an increase in business activity, and moderate optimism among architectural and design professionals despite a slowdown in recent activity.
“Construction professionals are closing the year with renewed confidence, supported by a surge in project activity in the third quarter and recent interest rate cuts,” says Marine Sargsyan, Houzz staff economist. “While backlogs have come down from record highs, firms continue to manage steady pipelines and make adjustments to maintain profitability. In contrast, design professionals remain more cautious, signaling that while homeowner interest persists, project planning cycles may lengthen as clients weigh broader economic factors heading into 2026.”
The Q4 2025 Construction Sector Barometer notes an increase in the Expected Business Activity Indicator for construction businesses related to project inquiries and new committed projects of 8 points to 66 for Q4, up from 58 in Q3. The Project Backlog Indicator is 5.4 weeks at the beginning of Q4, which is 5.1 weeks shorter than a year ago.
A majority of professionals (93% construction, 96% design) expect homeowners will have some concerns as they begin renovation projects going into 2026, with the top concerns noted as tariffs, overall project costs and the economy or job stability. To prepare for these challenges, many professionals are adopting or upgrading technologies (42% construction, 48% design), modifying pricing or contract terms (40% construction, 32% design) and placing greater emphasis on marketing and client acquisition (34% construction, 39% design).
