Home Improvement Spending Increases

Affordability pressure is inducing consumers to invest in their current homes, primarily to increase affordability, efficiency, health, and resiliency.

With mortgage rates above 7% and existing-home sales near a 30-year low, the house most people own today is the one they will likely be living in for the foreseeable future.

Consumers are pouring money into the homes they already have, and the reasons they give about why they’re investing tell us a great deal about where housing value is heading. Their remodeling choices show a desire for homes that cost less to live in, protect the people inside them, and hold value over time.

When asked what motivates them most to remodel, 48% of homeowners in COGNITION’s recent 2026 Retrofits Survey say they would rather improve their current home than move. Another 27% want to capture cost savings from energy efficiency upgrades. Only 18.5% cite aesthetics, and just 6.5% need to change the function of a space.

Source: COGNITION Smart Data, 2026 Retrofits Survey

When we asked homeowners which factors encourage them to invest in remodeling, long-term cost savings topped the list, with improving health and wellbeing coming in second, followed by adding value to the home and increasing resiliency to climate events.

  

Source: COGNITION Smart Data, 2026 Retrofits Survey

When asked which system they would prioritize during a large remodel, homeowners put energy systems at the top. That response matches energy system installations that we’ve been tracking: Reported solar installations climbed from 9% in 2024 to 47% in 2026, battery storage jumped from 3% to 45%, smart electrical panels from 4% to 29%, and demand-side energy management from 2% to 28%.

The primary reasons homeowners are installing these systems: self-sufficiency. Homeowners are looking to gain greater control over monthly costs and protect themselves from volatile energy prices.

66.9% of homeowners also report that they are reducing their home’s energy load with high-performance insulation, windows and doors, roofs, and HVAC. The 2026 results are different from previous years, when homeowners indicated that the upgrades they were investing in were in categories like lighting, appliances, and smart thermostats.

Homeowners are retrofitting for resilience with the same economic logic, investing in upgraded roofing, backup power systems, and fire resistant products, with 70% willing to spend $5,000 or more and more than 40% willing to spend over $10,000.

Healthy home upgrades represent the largest unmet demand in the existing housing stock. When we asked homeowners which wellness features they wish their current home had, roughly a third name healthier materials, more daylight or better water quality. Nearly half of consumers say they would pay $5,000 or more upfront for a healthy home, and nearly a quarter would pay more than $10,000.

For remodelers, contractors and manufacturers, this is an open lane. Ventilation, filtration, water treatment, low-toxicity materials and daylighting are retrofit-friendly upgrades that address documented demand, and they often accompany the energy and building envelope renovations homeowners are already planning.

Broader market data reinforces the COGNITION findings. According to the 2026 Synchrony and Home Improvement Research Institute (HIRI) remodeling report, 53% of Gen Z and Millennial homeowners are planning major improvements or upgrades in the next two years (compared with 43% of Gen X and 34% of Baby Boomers.)

The report also shows a price expectation gap: while homeowners estimate a lifetime of home maintenance will cost about $70,000, the actual figure is closer to $339,000, and with emergencies it can exceed $418,000.

That chasm in cost expectation versus reality shows how important it is that remodeling decisions are made today based on total cost of ownership rather than just first cost.

Vast opportunities exist in the remodeling market for building professionals and manufacturers alike. However, given current market conditions, it’s imperative to understand quickly changing homeowner priorities, spending patterns and expectations.

To provide essential insights into the remodeling market, Green Builder Media is partnering with Datavations and Kohler to present a webinar on Wednesday, October 28, at 12:00 p.m. ET, that will offer a data-driven look at the forces reshaping home improvement. The session will cover three distinct sources of market intelligence, synthesizing into one comprehensive view of what’s happening in the remodeling market, which products are being specified, what’s coming next, and how to capitalize on it.

Register now