{
  "id": 11846453,
  "title": "Citi explains why home improvement stocks are lagging in 2026",
  "url": "https://urgent.news/2026/10/04/citi-explains-why-home-improvement-stocks-are-lagging-in-2026",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-10-04T04:37:33.000Z",
  "source": {
    "name": "Investing.com",
    "slug": "investing-com",
    "url": "https://www.investing.com/news/stock-market-news/citi-explains-why-home-improvement-stocks-are-lagging-in-2026-4930904"
  },
  "original_language": "en",
  "account": "Citi analysts have shed light on the reasons behind the sluggish performance of home improvement stocks in 2026. The uncertainty surrounding interest rates, energy costs, housing affordability, and geopolitical events has put a dampener on the U.S. home improvement industry. During the HIRI Home Improvement Insights Summit, economists participating in the event largely anticipate that home improvement demand will remain stagnant over the next year. Higher interest rates and weak housing affordability continue to pose significant challenges, although they are somewhat offset by the resilience of consumers, a stable jobs market, and increasing household wealth.\n\nMortgage rates emerge as a major hurdle, with HIRI survey data suggesting that rates around the 5% mark could act as a psychological barrier for homeowners contemplating switching from existing mortgages. Approximately 80% of homeowners with mortgages currently have rates below 6%, and half have rates below 4%. Conversely, project delays are also dampening demand. A homeowner survey revealed that about one-third of home improvement projects are currently delayed or cancelled. A separate contractor survey reported that 60% of professionals have experienced at least one cancelled project, a sharp increase from the previous year. Economic conditions and inflation have been frequently cited as reasons for these setbacks. Projects that do proceed are increasingly focused on maintenance and repairs, with some also being scaled down to adhere to tighter budgets.\n\nDespite these challenges, the long-term industry fundamentals remain supportive. Americans now tend to stay in their homes for an average of 10 to 11 years, compared to the previous average of roughly seven to eight years. The average U.S. housing stock is 44 years old, implying a growing need for maintenance. On average, homeowners hold about $450,000 in equity, which can serve as a potential source of spending power. The U.S. has experienced roughly two decades of underbuilding in single-family homes, as noted by an economist from the National Association of Home Builders. Furthermore, AI technology could potentially streamline operations for retailers and contractors, with Lowe’s chief technology officer revealing that the company's strategy focuses on augmenting employees rather than replacing them. This approach could lead to efficiency gains, particularly in contractors' back-office operations. However, recent weakness in home improvement stocks indicates that investors are pricing in the possibility that sluggish industry growth could persist into 2027.",
  "summary": null,
  "key_points": [],
  "editors_take": "The sluggish performance of home improvement stocks reflects investors' expectations that high interest rates, weak housing affordability, and project delays will keep industry growth slow, potentially into 2027.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}