Meanwhile, homeowners are taking a more measured approach to future projects, with 50% planning renovations (down from 52% last year) and intended median spend declining to $15,000 for 2026 from $20,000 in 2025.

“Home renovation continues at historic levels, even as homeowners take a more cautious approach to future projects,” said Marine Sargsyan, head of economic research at Houzz. “What’s driving this resilience is pent-up demand from homeowners who are finally able to act on long-planned renovations. At the same time, we’re seeing a clear shift toward investing in forever homes rather than moving, with many adapting their spaces to meet changing needs.”

Pent-up demand remains the strongest motivator for home upgrades, with 40% of homeowners saying they finally have the time to renovate and 36% reporting they now have the financial means to do so. One in 5 renovations is driven by a recent home purchase (20%) or damage due to home age (19%), while life events account for another 16%. 

Among those updating due to life events, homeowners most often cite health or accessibility needs (21%), increased remote work (21%) and income or employment changes (20%), followed by a child moving out (19%). The survey also found that homeowners are adapting their existing spaces to meet these evolving needs rather than relocating, with nearly two-thirds of homeowners (61%) planning to stay in their homes for 11 years or more and 44% describing their residence as a forever home.

Gen Z Insights

Gen Z homeowners now account for 0.5% of renovators, up from 0.2% the year prior, representing a growing share of the overall market. They are significantly more likely to renovate following a recent home purchase (61%) compared with millennials (31%), Gen X (19%) and baby boomers (18%). Life changes also play a role, with one-third (33%) undertaking renovations due to shifts in family or daily life, while 22% address home damage.

The majority of Gen Z homeowners tackle interior room remodels (76%), the highest share of any generation, followed by home system upgrades (69%). Similar to other generations, kitchens are a leading priority (35%), though Gen Z homeowners are more likely than older generations to take on smaller spaces, particularly laundry rooms (33% versus 14% of millennials and Gen X) and closets (24% versus 17% of millennials).

Image credit: Design by Boyce Design + Build; Photography by Norton Aerial Media, LLC

“Gen Z is carving out a growing share of the renovation market, driven in large part by their foray into homeownership and the immediate need to address functional upgrades,” said Sargsyan. 

Older Homeowners Drive Highest Investment Levels

Seniors lead in median renovation spend at $25,000, while Gen X homeowners have now outpaced Baby Boomers, with a median spend of $24,000 compared with $22,000. At the high end, both Gen X and baby boomer projects reach $150,000 at the 90th percentile, underscoring the significant investment among these groups. This trend is especially evident in kitchen remodels, where spending rises steadily by generation and peaks among seniors at $27,500, nearly doubling from $15,000 the year prior and marking the largest year-over-year increase of any group.

In contrast, younger homeowners spend less overall, with Gen Z reporting a median of $8,500 compared with $15,000 for millennials. However, high-end activity differs sharply between the two groups, while the top 10% of Gen Z projects reach $52,000, millennial projects climb as high as $115,000. Gen Z homeowners are also more likely to rely on a broader mix of funding sources beyond savings (82%), including credit cards (34%) and tax refunds (14%), with tax refund usage significantly higher than among older generations.

Homeowners Turn to Credit Cards as Financing Mix Evolves

While the majority of homeowners continue to rely on savings to fund renovations (84%), credit cards are used by more than a third of homeowners (34%), up 5 percentage points year over year. Overall, the amount of funding sources is more diversified for those spending more than $50,000, with more homeowners borrowing against home equity (23%) and leveraging home sale proceeds (20%).

Despite three-quarters of homeowners setting initial budgets (75%), nearly 2 in 5 (37%) exceeded those plans in 2025, slightly outpacing those who came in on target (35%). While costlier than expected products or services (52%) remains a key factor, many homeowners are choosing to invest beyond their original plans by selecting higher-end materials (35%) or expanding the scope of their projects mid-renovation (31%).

High Reliance on Professionals Reflects Project Complexity

The vast majority of renovating homeowners (91%) hire professionals to complete their projects, reinforcing the essential role of industry experts in delivering complex renovations and the need for tools that support project coordination and transparency. General contractors continue to be the most frequently sought construction professionals, engaged by 29% of renovating homeowners. Design-build firms account for a smaller share of hiring, at 5%, but inched up by 2 percentage points year-over-year. As core systems remain a focus, specialty service providers are hired by homeowners, including electricians (41%), air conditioning and heating specialists (40%) and plumbers (36%).

Planning Surpasses Construction Timelines

Renovation projects take several months from idea to completion, with planning often exceeding the time spent on construction. Kitchen projects have the longest timeline overall, with an average of 9.5 months spent on planning and 5.8 months spent on construction. Even smaller-scale projects follow a similar pattern. Closets and home offices, for example, take 6.6 and 6.1 months on average to plan, respectively, and have construction phases that last 4.3 and 3.4 months on average, respectively. 

Home Improvement Purchases Remain Steady Despite Select Declines

Home improvement purchasing activity remains consistent across most categories, even as a few areas see modest year-over-year declines. Paint (62%) continues to be the most commonly purchased category, followed by lighting fixtures (48%) and faucets and shower heads (46%). Building materials (41%) and lawn and garden supplies (44%) also rank highly, while select categories such as major kitchen appliances (29%, down from 33%) and noncarpet flooring (34%, down from 38%) have seen slight declines.

The Houzz & Home Study

The annual U.S. Houzz & Home Study is the largest survey of residential remodeling, building and decorating activity published. The survey covers a wide range of renovation projects in 2025, from interior remodels and additions to home systems, exterior upgrades and outdoor projects. Data gathered includes historical and planned spends, professional involvement, motivations and challenges behind building, renovation and decorating projects, as well as planned activities for 2026. The 2026 study includes more than 20,000 respondents in the U.S. alone, providing insights into the home improvement activity of the millions of users of the Houzz site and mobile apps.

The 2026 U.S. Houzz & Home survey was sent to registered users of Houzz and fielded between January and March 2026.

The full report is available here.

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The AI-powered Clipper is integrated directly into the Houzz Pro app and allows professionals to capture product details, pricing and images from any mobile browser. Pros can quickly save products to their library and add them to proposals, selection boards and project budgets without installing extensions or additional tools.

“The future of sourcing is mobile, AI-powered and completely seamless, and now we’ve brought this to the Houzz Pro app,” said Alon Cohen, Houzz co-founder and CEO. “With the mobile Clipper, it’s easier for pros to capture products from anywhere and easily move from inspiration to execution. Combined with new selection board templates and placeholders, Houzz Pro provides a more complete solution for managing sourcing, selections and project budgets in one place.”

New Houzz Pro Selections updates include the ability to clip from URL, add Selections board placeholders and save Selections board templates.  

Pros can source products in seconds by pasting a product URL directly into a Selections board, allowing them to capture product information from any website without installing extensions. 

Users can also add placeholders before final product decisions are made, helping teams track quantities and budget allowances early in the project. Once a final product is selected, all the images and details replace the placeholder while preserving quantities, comments and financial data. 

Finally, professionals can now save existing Selection Boards as templates or create new templates from scratch for a repeatable selection process. Paired with placeholders, templates provide a roadmap of the items needed for a project so teams can stay organized and ensure nothing is missed.

“The Houzz Pro Clipper is a lifesaver,” said Jonathan Gordon, founder of Design by the Jonathans. “It gathers all of the information for you while you’re on the go. It’s fast and easy to use. When you clip a product to your library, all the images, descriptions and pricing are ready to pull into a proposal.”

The Houzz Pro Clipper and Selections tools are available to all Custom package subscribers. The tools are fully integrated into Houzz Pro and complement a robust set of features that help pros manage the complete project lifecycle, including Estimates, Invoicing, Takeoffs, 3D Floor Plans, Mood Boards, Online Payments and more.

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Looking at Q1, expectations are more subdued in the construction sector (55), following a 4-point decline in Q4 business activity (51) compared with Q3 2025. In contrast, design firms are more optimistic (61) as they closed out the year on a stronger note, with an 11-point increase in business activity (54) versus Q3 2025 (43), as more architects and designers reported gains in recent activity compared to those reporting declines.

“Construction and design businesses are heading into 2026 with a measured but resilient outlook,” said Marine Sargsyan, head of economic research at Houzz. “While expectations for the broader national economy remain subdued and cost and labor pressures persist, many firms anticipate stable demand for their projects. To drive revenue growth in 2026, businesses are adjusting their strategies by raising prices, prioritizing larger and higher-value projects, and investing in employee productivity, reflecting broader industry interest around AI-enabled software tools such as Houzz Pro.”

2026 Outlook

Houzz asked construction and design pros about their outlook for 2026 and expectations across various market conditions. In addition to the overall moderate business outlook for the year mentioned above, expectations for 2026 include: 

• Improving demand: Nearly two-thirds of design firms expect improved demand in 2026 (62%), compared with 57% of construction firms. 

• Mixed economic expectations: More businesses expect local economic conditions to strengthen (38% construction, 43% design) than worsen (29% construction, 26% design), while a larger share of pros anticipate the national economy will slow (43% construction, 51% design) rather than improve (30% construction, 32% design).

• Ongoing labor constraints: More than one-third of construction firms and nearly one-third of design firms expect labor shortages to persist (36% and 30%, respectively).

• Rising costs: A majority of businesses expect product and material costs to increase (69% construction, 65% design).

• Top strategies to achieve revenue growth in 2026: 

• Pursue larger-budget projects (71%, construction, 64% design)

• Increase markup or margin (45% construction, 50% design)

• Improve employee productivity (32% construction, 30% design)

Near-term expectations are more varied across the construction and design sectors as businesses enter Q1 2026.

Q1 2026 Architectural and Design Services Sector Barometer

• The Expected Business Activity Indicator related to project inquiries and new committed projects increased to 61 for Q1 2026 (up 2 points from Q4) for the design sector. This is driven by a 4-point increase in expectations for project inquiries, while expectations for new committed projects remained steady at 60 points. Expectations for Q1 inched up to 61 for architects and remained at 61 for interior designers. 

• The Project Backlog Indicator dropped significantly to 4.5 weeks in the beginning of Q1, 2.8 weeks shorter than a year ago. This was driven by the backlog for architects which dropped by half to 4.5 weeks, a decrease of 4.3 weeks. Meanwhile, interior designers were consistent year over year, reporting a 4.5 week backlog, down just 0.1 week from the same time last year.

• The Recent Business Activity Indicator related to project inquiries and new committed projects jumped to 54 in Q4 (versus 43 in Q3). This is driven by increases in both project inquiries (54) and new committed projects (53) in Q4 (up 11 points, each). Architects reported the largest improvement in recent business activity, with the indicator reaching 55 (up 16 points), followed by interior designers (50, up 2 points).

Q1 2026 Construction Sector Barometer

• The Expected Business Activity Indicator for construction businesses related to project inquiries and new committed projects declined by 11 points to 55 for Q1 (from 66 for Q4 2025). This is largely driven by double digit declines in expectations for project inquiries to 57 and new committed projects to 53 (down 10 points and 11 points from Q4 2025, respectively). Similarly, while both build-only remodelers and design-build firms anticipate improved Q1 business activity compared to Q4, with the indicator at 55 and 56, respectively, the expected business activity indicators are down 10 points, each.

• Overall, the Project Backlog Indicator remains largely consistent with last year’s level at the same time: 6.1 weeks in the beginning of Q1, up 0.3 weeks from a year ago. Build-only remodelers report a 5.5 week backlog (up 0.5 weeks), while design-build remodelers report a 6.6 week backlog (down 0.1 weeks). 

• The Recent Business Activity Indicator related to project inquiries and new committed projects declined to 51 in Q4 (from 55 in Q3). This is driven by a 13-point decrease in project inquiries to 49 in Q4, relative to the previous quarter. In contrast, new committed projects increased by 3 points, reaching 52 points. While more businesses reported improvements in committed projects, a larger share of them cited a slowdown in Q4 project inquiries. The recent business indicator increased to 59 for build-only remodelers and declined to 43 for design-build remodelers in Q4. 

The quarterly U.S. Houzz Pro Industry Barometer provides timely insights into the residential construction and design industry, including expectations, project backlogs and recent activity among businesses in the U.S. construction and architectural and design services sectors. Scores for each component are computed as a seasonally adjusted diffusion indices on a scale of 0 to 100, with index values over 50 indicating that a greater proportion of firms reported quarter-over-quarter increases than those reporting decreases. Detailed methodology and underlying quarterly indices for the construction sector and the architectural and design services sector, and other information on market conditions, can be found on houzz.com/research. The Q4 2025 Barometer was fielded December 2nd through December 22nd, 2025 and garnered responses from over 1,100 home improvement firms on Houzz. n=1,174.

If an indicator is above the 50-point line, more businesses reported an increase in expected or recent business activity compared to the previous quarter than those reporting decreases.

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“Contracts are the foundation of every project, yet managing them has traditionally been a complex process,” said Alon Cohen, Houzz co-founder and CEO. “With the new Houzz Pro Contracts tool, building, remodeling and design professionals can finalize agreements quickly, stay organized and deliver an end-to-end client experience that inspires confidence and builds lasting trust.”

With Contracts directly integrated into Houzz Pro, professionals can eliminate third-party contract tools and benefit from streamlined workflows and reduced friction. Contracts sent through Houzz Pro are signed on average in just over two days versus the one week, pros report it takes using other methods.

User‑friendly features of the Houzz Pro Contracts tool include:

• Smart Text that makes it easy to fill in project, client and subcontractor details in one click, helping pros work faster and avoid repetitive manual data entry.

• Built‑in eSignatures for fast, secure digital signing from any device.

• Contract templates so pros do not have to source contracts externally.

• Customizable branding and letterhead with logo.

• Centralized cloud access to signed contracts and activity history.

• Commenting and edit tracking to make it easy to follow progress.

• Notifications and reminders with real-time updates when contracts are opened, viewed or signed, plus automated follow-ups to keep projects on track.

The Houzz Pro Contracts tool is available to all “Custom” package subscribers in the U.S. It is fully integrated into Houzz Pro and complements the robust set of features that help pros manage projects from first contact to final payment, including Estimates, Invoicing, Takeoffs, Selections, 3D Floor Plans, Online Payments and more.

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Looking forward to 2026, nearly all professionals anticipate that homeowners will have at least some concerns as they embark on their renovation projects in the coming year (93% construction, 96% design). The top concerns cited include overall project costs, tariffs and the economy or job stability. In anticipation, many pros are adjusting how they operate by 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).

“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,” said Houzz staff economist Marine Sargsyan. “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.”

Q4 2025 Architectural and Design Services Sector Barometer

The Expected Business Activity Indicator related to project inquiries and new committed projects increased to 59 for Q4 2025 (up 1 point from Q3) for the design sector. This is driven by a 2-point increase in expectations for new committed projects, while expectations for project inquiries remained steady at 58 points. Expectations for Q4 among both architects and interior designers inched up to 58 and 61 respectively.

The Project Backlog Indicator is 5.5 weeks in the beginning of Q4, which is 0.8 weeks shorter than a year ago. Architects report a 5.8 week backlog (a decrease of 2 weeks), while interior designers report a 4.9 week backlog (an increase of 1 week).

The Recent Business Activity Indicator related to project inquiries and new committed projects decreased to 43 in Q3 (versus 45 in Q2). This is driven by drops in both project inquiries (43) and new committed projects (42) in Q3 (down 3 and 2 points, respectively). Architects reported the most significant decrease to 39 (down 6 points), followed by interior designers (48; up 3 points).

Q4 2025 Construction Sector Barometer

The Expected Business Activity Indicator for construction businesses related to project inquiries and new committed projects increased by 8 points to 66* for Q4 (from 58 for Q3). This is largely driven by a 12-point uptick in expectations for new committed projects in Q4. Similarly, expectations for project inquiries increased by 3 points to 67 for Q4 (from 64 for Q3). Both build-only remodelers and design-build firms expect improved Q4 business activity, with the indicator at 66 points each.

The Project Backlog Indicator is 5.4 weeks in the beginning of Q4, which is 5.1 weeks shorter than a year ago. Build-only remodelers report a 4.4 week backlog (down 3.9 weeks), while design-build remodelers report a 6.3 week backlog (down 6.5 weeks).

The Recent Business Activity Indicator related to project inquiries and new committed projects jumped to 55 (from 38 in Q2). This is driven by a 20-point increase in project inquiries to 62 in Q3, relative to the previous quarter. Similarly, new committed projects increased by 13 points, reaching 48 points. The recent business indicator increased to 56 for build-only remodelers and to 54 for design-build remodelers in Q3. 

2026 Homeowner Outlook and Business Response 

Houzz asked construction and design pros about the challenges they anticipate homeowners will face when deciding to move forward with renovation projects in 2026. The top homeowner concerns include: 

• Overall project costs (74% construction, 80% design).
• The economy / job stability (40% construction, 41% design)
• Tariffs (31% construction, 44% design)
• Securing financing or loans (16% construction, 11% design)
• Competing household priorities (15% construction, 11% design)
• Availability of products and materials (13% construction, 19% design)

Amid ongoing economic uncertainty, businesses across the industry are taking proactive steps to strengthen their operations, protect margins and sustain growth. Nearly 9 in 10 firms expect to make changes to the way they run their businesses (86% construction, 86% design). 

The most common strategies include adopting or upgrading technologies, particularly those with project management capabilities and AI-powered features. More than a third of firms across both subsectors plan to place greater emphasis on marketing and client acquisition (34% construction, 39% design), while others are also adjusting pricing structures and contract terms (40% construction, 32% design) to maintain stability.

The quarterly Houzz U.S. Renovation Barometer provides timely insights into the residential renovation industry, including expectations, project backlogs and recent activity among businesses in the U.S. construction and architectural and design services sectors. Scores for each component are computed as a seasonally adjusted diffusion indices on a scale of 0 to 100, with index values over 50 indicating that a greater proportion of firms reported quarter-over-quarter increases than those reporting decreases. Detailed methodology and underlying quarterly indices for the construction sector and the architectural and design services sector, and other information on market conditions, can be found on houzz.com/research. The Q4 2025 Barometer was fielded Sept. 18 through Oct. 6, 2025, and garnered responses from more than 1,000 home improvement firms on Houzz.

*If an indicator is above the 50-point line, more businesses reported an increase in expected or recent business activity compared to the previous quarter than those reporting decreases.

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“Accessibility has become a defining priority in bathroom remodeling,” said Marine Sargsyan, Houzz staff economist. “Driven by demographic shifts and broader market trends, homeowners are increasingly working with professionals to integrate features that make their bathrooms safer, more adaptable and more supportive for all household members now and into the future.”

When addressing special needs today, homeowners most often focus on aging household members (41%, an increase of 4 percentage points). Planning for the future needs of aging household members holds an even higher share (49%). Other considerations include household members with disabilities (11%) and young children (5%). These priorities are reflected in popular design choices such as low-curb showers (52%), additional lighting (31%) and curbless showers (28%), which enhance safety, accessibility and ease of use for people of all ages and abilities.

“There is a role for accessible design in everyday living — whether it’s energetic kids, a loved one recovering from surgery or the realities of aging in place,” designer and Houzz Pro user Dana Bass of Dana Bass Designs said. “It’s about creating flexible spaces that adapt seamlessly to the changing needs of every household.”

Homeowners are also turning their bathrooms into spaces for self-care and rejuvenation, with more than a third of renovated bathrooms (36%) now including wellness-oriented features such as upgraded lighting (30%), soaking tubs or spa baths (18%) and water features like fountains or walls (13%). Renovators emphasise factors that support comfort and wellbeing, led by cleanliness (74%), spacious showers (65%), organized storage (59%) and natural light (43%). 

The majority of homeowners engage home professionals to guide them through renovations (84%). With homeowners citing project visualization as a top challenge during renovations, pros are turning to tools like Houzz Pro’s 3D Floor Planner, Selections and Mood Boards to help their clients understand the aesthetics and functionality of the new space. 

Alair Homes Charlotte, Katy Perry Ascendent Imaging

A Deep Dive on Wet Rooms

One in 6 renovated bathrooms now feature wet rooms, an increase of 3 percentage points compared with last year. Known for their open-concept design, with little to no enclosure separating the shower or tub from the rest of the space, wet rooms appeal to homeowners for both practical and aesthetic reasons.

• Motivations: Among those who created a wet room, half said it made better use of space (50%), while others pointed to the aesthetic appeal (29%) or increased accessibility (26%).
• Wet Room Walls: Rectangular tiles dominate wet room walls, chosen by nearly 9 in 10 homeowners (89%), followed at a distance by square shapes (5%). Larger format tiles are most popular, with nearly half of homeowners (48%) selecting tiles in the 12-by-24- to 18-by-18-in. range. Medium tiles (6 by 6 to 12 by 12 inches) follow at 29%.
• Wet Room Floors: A brick pattern is the most common choice for wet room floor tile, selected by one third of homeowners (33%). This is notably higher than in other types of bathrooms (20%). Beyond brick, many homeowners opt for grid (22%) and mosaic (12%) layouts in their wet rooms.

Additional bathroom trends from the study include:

• Homeowners Favor Custom Choices: More than half of homeowners (55%) chose either a fully custom (33%) or semi-custom (22%) vanity, showing a strong preference for tailored designs over stock options. A similar trend appeared with medicine cabinets, with 14% choosing custom and 12% choosing semi-custom.
• Safety and Comfort Drive Bathtub Upgrades: Specialty bathtub features are on the rise, with 55% of renovating homeowners including upgrades that prioritize safety and relaxation (up 5 percentage points since 2023). Nonslip flooring (24%) and grab bars (23%) are the most common additions. Comfort-driven features also stood out, such as space for two (12%), whirlpool or jets (12%), and built-in seating (7%). 
• Horizontal Stack Tile Patterns Surge: Horizontally stacked shower wall tiles are up 5 percentage points from last year, now selected by 18% of renovating homeowners. However, horizontal brick remains the top choice (31%) with vertical stack again ranking second (20%).
• Accent Walls Make Bold Statements: Nearly a third of renovating homeowners (31%) bring personality to their bathrooms with accent walls. Among them, bold patterns (46%) and solid colors (46%) were equally popular, while 45% opted for textured surface materials to enhance visual interest.

You can download the full 2025 U.S. Houzz Bathroom Trends Study here.

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Recent trends include bold color, layered textures, statement countertops, an affinity for wallpaper and integrated features. The full report is available here. 

Bold Color, Personality and Individuality: Design and construction pros on Houzz say that more homeowners are embracing bold choices. Jewel tones, wallpaper, statement ceilings, painted doors and playful patterns are all part of a push for individuality. The shift reflects a move away from resale-driven decisions toward deeply personal designs, with homeowners opting for vivid, expressive details that make their spaces feel unique and emotionally resonant. Designers using Houzz Pro can bring their most vibrant ideas to life in a visual Mood Board.

Layered Textures: Layered textures — from boucle and grasscloth to plaster, zellige tile, fluting and handcrafted details — are taking over. Designers on Houzz are treating texture as the new neutral, using it to bring warmth, depth and subtle dimension. Inviting spaces that feel rich, lived-in and full of personality are the result.

Statement Countertops and Backsplashes: Statement countertops and backsplashes are becoming the centerpiece of kitchens, with quartzite and dramatic-veined stone in high demand. Homeowners are seeking one-of-a-kind slabs that feel like art, alongside trending tiles such as zellige and other handcrafted options. With the Houzz Pro Selections tool, designers can share curated countertop and backsplash picks in one spot, so you can easily picture how bold stone or tile will make your space shine.

Wallpaper Re-Revival: Wallpaper has had several revivals in recent years — now it’s booming again. And not just on walls. It’s also showing up frequently on ceilings, along with other design treatments like bold paint, beams and coffers to add character and highlight architectural details.

Design/Build: Copper Sky Design + Remodel
Photographer: Anastasia Alkema

Integrated, Seamless and Hidden Features: Design is getting smarter and more discreet. Hidden appliances, panel-ready cabinetry, hydraulic lift storage, pop-up TVs, concealed hoods and integrated lighting are growing in popularity for their sleek, clutter-free look. These innovations keep open-plan homes streamlined and functional while adding a touch of modern sophistication.

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While many couples describe renovating together as “collaborative” (59%) or “fulfilling” (50%) according to the recent survey from Houzz Inc., the leading all-in-one software platform for construction and design, a notable share admit the process tested their relationship to its limits. 

Despite challenges, nearly all couples agreed the finished project made the journey worthwhile (96%). Many reported feeling more comfortable (60%), happier (52%), calm and stress-free (39%), and more organized (38%) in their newly renovated home. 

Common sources of conflict during renovations include difficulty staying on budget (31%), deciding on products, materials or finishes (28%), and agreeing on the project’s scope or design (20% each). Selections for paint colors (36%), furniture (33%) and flooring materials (29%) were frequently cited as sticking points and tended to be influenced by relationship duration. Those together less than 10 years were more likely to struggle with furniture choices (41%), while couples of 30 years or more disagreed most often on paint colors and flooring (35% each). Couples with established relationships of 21 to 30 years had the highest rate of flooring disagreements (44%).

Couples navigated these challenges by compromising (56%) and using tools to help them visualize the finished result (44%). Couples early in their relationship were most likely to compromise (64%). In contrast, long-term couples were twice as likely to have one partner defer to the other (10% vs. 5% for relationships less than 10 years).

“A home renovation is clearly one of the most demanding journeys a couple embarks on together, with numerous decisions, budget considerations and trade-offs along the way,” said Marine Sargsyan, Houzz staff economist. “The findings highlight how communication, compromise and visualization technologies help mitigate disagreements and support productive collaboration throughout the renovation process among couples and the pros they hire.”

When it comes to working with hired design and construction professionals, many respondents report a desire for improved visibility and coordination during a project. The most common requests include transparent pricing (45%), clear communication (42%) and more accurate timelines (39%). 

Tools like Houzz Pro’s Client Dashboard, Estimates, Selections and Schedule help address these desires, enabling construction and design professionals to keep clients informed, involved and confident throughout the process. 

“We used Houzz Pro during a recent project to explore design ideas together with our clients, get feedback and secure approvals,” said designer Anastasia Harrison of AHD & Co. “The couple often remarked on how seamless and organized the process felt and how confident they were in every decision they made. They truly enjoyed the project.”

Danielle Barzilay Dahan of RnD Builders Inc. also sees software as a way to deliver a great client experience. 

“We use Houzz Pro software to manage projects, communicate with clients and help homeowners visualize the final outcome through Mood Boards and 3D visual tools to keep clients informed and engaged at every step,” said Dahan.

The 2025 U.S. Houzz Remodeling & Relationships Survey was sent to registered Houzz users and fielded in January 2025. n=541.

The full report is available here.

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With AutoMate AI—Houzz Pro’s suite of integrated AI tools—pros can now handle administrative work more productively by generating detailed financial documents, tracking expenses and managing tasks with unprecedented speed and ease on-site or at the office. Documents include professionally formatted estimates, proposals, change orders and invoices, each complete with detailed line items, clear descriptions and location-based pricing. 

“With these latest AutoMate AI features, we’re streamlining administrative work that once took considerable time and effort,” said Alon Cohen, Houzz co-founder and CEO. “By tapping into AI, we’re helping to redefine how pros approach their workflows and unlock new levels of productivity, organization and impact across every stage of a project. This is about more than saving time; it’s about empowering pros to run more profitable, professional businesses with less effort, from anywhere.”

Administrative tasks are the most common reason pros use AI in their workflows, according to the 2025 U.S. Houzz State of AI in Construction and Design Report, making these latest AutoMate AI enhancements a direct response to the industry’s demand for faster, smarter solutions. New features include: 

• AI Documents: Pros can instantly generate and edit any financial document, including estimates, proposals, change orders and invoices with AutoMate AI. For example, to create an estimate, pros can type or use voice input to describe a project, including project type or scope, size of the space or tier (high, medium, lower). AutoMate AI uses those inputs to  create a professional document with anticipated labor and material costs, automatically using pricing based on project location and eliminating manual data entry. 

• AI Tasks: AutoMate AI scans daily logs and notes to proactively recommend relevant tasks, helping pros follow up, delegate and stay organized. Tasks can be added to the project schedule to help keep teams aligned and informed. 

• AI Expenses: Pros can take a photo of a receipt and AutoMate AI will extract and fill in key details to instantly log an expense under the related project in Houzz Pro. 

“Houzz Pro’s new AutoMate AI-powered features make estimating so much easier,” said Jason Dankworth of Sound Construction. “Instead of spending hours building out line items, I can now generate a detailed, accurate estimate in seconds, right from my phone. The AI takes into account my project location, typical materials and past work, so I’m not starting from scratch each time. This drastically cuts down estimating time so I can get back to focusing on the job itself.”

These new AutoMate AI-powered Houzz Pro features reflect Houzz Pro’s broader vision for an intelligent, all-in-one platform built for building, remodeling and interior design professionals. By embedding AI into daily tasks—from financial documentation to sourcing and expense tracking—Houzz Pro helps teams work more efficiently, accurately and with less administrative burden. And the results speak for themselves: pros are creating estimates more than twice as fast with AutoMate AI than with manual methods.

“Houzz Pro’s AI estimating tool can do in 20 seconds what it would take an experienced person an hour to do,” said Matt Panella of Panella Construction. “Costs are very close if not spot on at the line-item level, and it helps ensure no item is left out.”

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“At Houzz we’re committed to supporting emerging talent in construction and design,” said Liza Hausman, vice president of Industry Marketing at Houzz. “Through initiatives like Houzz Scholarships, free access to Houzz Pro and a range of career resources, we’re committed to empowering students throughout their educational and professional journeys.

“This year’s recipients impressed us with their enthusiasm for the built environment, hands-on experience and bold vision for the industry’s future. It’s inspiring to champion such driven students as they take their next steps toward impactful careers.”

As part of Houzz’s continued dedication to empowering the next generation of construction and design professionals, the program awards five $2,500 scholarships in the categories of Women in Architecture, Residential Design, Sustainable Residential Design, Residential Construction Management and Skilled Trades. In addition to submitting a brief essay on their design and architecture influences, applicants create a Houzz professional student profile, where they can showcase their portfolio of work and network with more than 3 million active professionals around the world. 

The deadline for 2026 scholarship entries is March 31, 2026. Learn more and apply at houzz.com/scholarships. 

The 2025 scholarship winners are: 

• Women in Architecture: May Ritter, studying architecture at California Polytechnic State University, San Luis Obispo

• Residential Design: Jacob Galantowicz, studying architecture at University of Illinois Urbana-Champaign

• Sustainable Residential Design: Ava Dreifke, studying landscape architecture at University of Florida

• Residential Construction Management: Jade Alberti, studying construction management at California Polytechnic State University, San Luis Obispo

• Skilled Trades Residential Construction: Tahm Lytle, studying carpentry at Yestermorrow Design/Build School

“I’m truly honored and grateful to have been selected for the Sustainable Residential Design Scholarship from Houzz,” said Ava Dreifke. “It means so much to be recognized and supported in this way. This scholarship will make a meaningful difference in helping me continue my education and pursue my goals in sustainable design.”

In addition to applying to Houzz scholarships, students looking to gain hands-on experience and stand out in the job market can take advantage of Houzz Pro for Students. The program gives students in residential construction and design-related academic programs a free, one-year subscription to Houzz Pro, the AI-powered project management and design software for interior design, building and remodeling professionals. Students have the opportunity to learn how to use software tools like Takeoffs, Estimates, Proposals, 3D Floor Plans and Mood Boards that will help them to develop efficient, sustainable business practices. 

Houzz Pro for Students is available in the U.S.

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“Expectations have become increasingly cautious among construction and design professionals as they navigate ongoing economic challenges and reduced business activity,” said Marine Sargsyan, Houzz staff economist. “That said, stable backlogs and gradual adjustments in response to market conditions indicate some resilience.  Most are hopeful for improved momentum through the second half of the year.”  

Q3 2025 Design Sector Barometer

The Expected Business Activity Indicator related to project inquiries and new committed projects declined to 58 for Q3 2025 (down 4 points from Q2) for the architectural and design services sector. This is driven by a 4-point decline in expectations for project inquiries and a 4-point drop in expectations for new committed projects (58 each). While the indicators dipped 2 points for architects (to 57) and 8 points for interior designers (to 59), more businesses expect an improvement in business activity in Q3, when compared to Q2 activity, than those expecting declines. 

The Project Backlog Indicator is 5.9 weeks in the beginning of Q3, which is 0.2 weeks longer than a year ago. Architects report a decrease of 0.7 weeks to 6.7 weeks, while interior designers report an increase of 1.5 weeks in wait times at 4.4 weeks.

The Recent Business Activity Indicator related to project inquiries and new committed projects decreased to 45 in Q2 (versus 59 in Q1). This decrease is driven by drops in both project inquiries and new committed projects in Q2, each decreasing by 11 and 16 points to 46 and 44, respectively. The indicator is down 14 points for architects (45) and down 13 points for interior designers (45). Top challenges to business activity included higher prices of products and materials (53%), increased labor costs (26%) and difficulty maintaining profit margin (23%).

Q3 2025 Construction Sector Barometer

The Expected Business Activity Indicator for construction businesses related to project inquiries and new committed projects decreased by 1 point to 58 for Q3 (from 59 for Q2). This is largely driven by a 9-point decline in expectations for new committed projects in Q3. Conversely, expectations for project inquiries increased by 7 points to 64 for Q3 (from 57 for Q2). Both build-only remodelers and design-build firms expect improved Q3 business activity, with the indicator at 58 points each. 

The Project Backlog Indicator is 6.1 weeks in the beginning of Q3, which is 1.5 weeks shorter than a year ago. Build-only remodelers report a decrease of 1.2 weeks to 6.4 weeks, while design-build remodelers report a decrease of 1.9 weeks in wait times at 5.8 weeks.

The Recent Business Activity Indicator related to project inquiries and new committed projects dropped to 38 (from 42 in Q2). This is driven by an 8-point drop in new committed projects to 34 in Q2, relative to the previous quarter. Project inquiries stayed stable at 42 points. The recent business indicator dropped to 35 for build-only remodelers and to 42 for design-build remodelers in Q2. The overall indicator is below the 50-point line, as more businesses reported a decline in business activity than those reporting improvements. Main challenges to business activity included increased prices of products and materials (45%), higher labor costs (32%) and difficulty maintaining profit margin (26%).

A Deeper Look into Anticipated Economic Factors

Houzz continued to explore how pros expect economic factors–such as new tariffs, rising interest rates and labor shortages–to impact their businesses and the industry at large using the Q3 2025 Houzz U.S. Renovation Barometer survey. Findings (as reported by each industry sector) include: 

• More than 9 in 10 residential construction and design professionals anticipate that market shifts will have a negative impact on their business in Q3 (93% construction, 94% design). Key factors include tariffs (48% construction, 59% design), inflation (42% construction, 46% design) and  hesitation from clients when committing to projects (38% construction, 37% design).
  
• Pros are most concerned about tariffs on lumber or plywood (66% construction, 68% design), steel (56% construction, 65% design), flooring (50% construction, 60% design) and aluminum (41% construction, 43% design).

• Businesses in the design sector anticipate tariffs to impact lighting fixtures (73%), appliances (71%), indoor furniture (65%). Construction businesses are concerned about appliances (68%), plumbing fixtures (56%), cabinetry (55%) and HVAC systems (44%).

• Both sectors anticipate moderate to severe labor shortages, particularly among general laborers (59% construction, 48% design) and finish carpenters (45% construction, 39% design). Shortages of framers (31% construction, 29% design) and plumbers (36% construction, 31% design) are also notable concerns.

 The quarterly Houzz U.S. Renovation Barometer provides timely insights into the residential renovation industry, including expectations, project backlogs and recent activity among businesses in the U.S. construction and architectural and design services sectors. Scores for each component are computed as a seasonally adjusted diffusion indices on a scale of 0 to 100, with index values over 50 indicating that a greater proportion of firms reported quarter-over-quarter increases than those reporting decreases. Detailed methodology and underlying quarterly indices for the construction sector and the architectural and design services sector, and other information on market conditions, can be found on houzz.com/research. The Q3 2025 Barometer was fielded June 14 through July 1, 2025, and garnered responses from over 900 home improvement firms on Houzz. n=929.

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More than a third of industry pros are already using AI in their businesses (34%), and they report saving an average of more than three hours per week, citing benefits like greater productivity, reduced manual effort and improved organization. This savings translates to more than $108,000 in annual productivity gains per business*.

Strikingly, two-thirds of respondents believe AI will transform the industry within the next five years (66%). Awareness of AI is already widespread across the industry, with nearly 7 in 10 pros saying that they know about AI (69%). Less than a quarter are not very familiar with AI (23%) and only 8% report no exposure at all. Notably, nearly 3 in 5 pros are familiar with AI tools specifically designed for construction and design workflows (59%). 

“AI innovation in construction and design is accelerating, creating a competitive advantage for pros who adopt it,” said Alon Cohen, Houzz co-founder and CEO. “The next wave of transformation will be driven by AI solutions that integrate seamlessly into workflows for greater efficiency and accuracy.

“As the report shows, pros in our industry are approaching this era with openness and a strong desire to learn. The future is about adopting AI to build stronger, more successful businesses. At Houzz, this vision has guided our work: embedding powerful AI capabilities directly into the software pros already use, to boost productivity across every phase of a project and client relationship.” 

AI adoption is significantly higher among larger firms with more than 10 employees, suggesting that greater scale allows for the resources needed to research, experiment and drive adoption of new tools and approaches. In the construction industry, nearly one-third of businesses report using AI (32%), but usage doubles among large firms (64%). Similarly, 31% of all design firms report using AI, growing to 50% among large firms. 

Construction pros lean on AI most frequently for administrative tasks and project management, while designers are tapping it for admin and content-driven tasks. Specific activity includes:

• Administrative work (62% across all pros, 47% construction, 70% design), such as AI assisted note-taking, formatting and document editing.

• Sales and marketing (55% across all pros, 37% construction, 59% design) activities, particularly related to social media content, advertising and lead management.

• Planning and design (42% across all pros, 32% construction, 34% design) tools to visualize projects, generate floorplans and support takeoffs.

• Project and client management (33% across all pros, 42% construction, 14% design) features for estimating, invoicing and task tracking.

Nearly three-quarters of AI users in design and construction firms are satisfied with their experience (71%), and 58% say AI has had a moderate to significant impact on their workflow. However, concerns persist, including the reliability and accuracy of AI-generated outputs, data security and privacy risks, and a lack of adequate training or technical expertise. 

While satisfaction with AI tools is high, the report highlights a gap in training and support. The vast majority of industry pros using AI report having no formal instruction in how to apply it to their work (94% of designers and 92% of contractors). 

This points to an opportunity for solutions that integrate AI into familiar workflows and provide accessible ways for construction and design pros to incorporate emerging technologies. Houzz Pro, for example, includes AI-powered features for estimates, takeoffs, messaging and visualization within its project management and design tools, aiming to support professionals in adopting AI as part of their day-to-day work.

* The estimated annual productivity value is based on self-reported weekly time savings from AI-use and average annual revenue among construction and design businesses. The calculation assumes a 40-hour workweek and that time saved translates into productivity gains.

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