2026 Remodeling Industry Outlook

Dear friends and clients of Advance Design Studio,

As we close out 2025, we would like to take a moment to thank you for being part of our community. This week, we especially celebrate clients with our 6th Annual Client Appreciation Pie Nights, where we’re sharing nearly 100 Thanksgiving pies with clients and our team as a small token of appreciation. This year brought creativity, collaboration, and so many beautiful projects to life, and we’re grateful for every one of them. Your trust in our team continues to inspire the work we do.

Looking Back on 2025

2025 Highlights

Our team celebrated several milestone recognitions this year, including:

11 straight years as a GuildMaster Award Winner for customer service and craftsmanship
11 straight years of Houzz Best of Design or Service Awards
A 2025 Chrysalis Award for our Hawthorn Woods Sunroom Addition
10 consecutive years on the Qualified Remodeler Top 500 List
5 consecutive years as a Nextdoor Neighborhood Favorite

Our construction management software, Buildertrend, remains an essential part of our process, and this past year has been its most robust and impactful one yet. Clients have shared how effective it’s become as a central communication hub- consolidating schedules, daily updates, progress photos, and ongoing conversations all in one easy-to-find place. The result has been a powerful sense of connection and control throughout the entire process in a way that traditional communication can’t match.

In 2026, we look forward to expanding our client portal’s capabilities further as we integrate billing history, invoicing, and secure payment methods seamlessly into this single platform, making the project journey smoother and more transparent than ever.

This year, we also expanded the ways we educate and support homeowners. We introduced new free remodeling workshops, where our design and construction experts share insights into the remodeling industry, guide homeowners through budgeting, and offer free resources to maximize the value of every renovation experience. These workshops have opened up meaningful opportunities for homeowners to connect with our design team, ask questions directly to our construction managers, and spend time with our owners for a firsthand look at our history, philosophy, and the care we bring to every home. If you haven’t joined us yet, keep an eye on our schedule as we release our 2026 dates.

The remodeling industry has navigated significant uncertainty throughout 2025, with rising labor and material expenses affecting both homeowners and professionals. Persistent skilled-labor shortages- especially among carpenters, electricians, and masons- continue to push wages upward, adding meaningful cost pressure even as some material categories stabilize. While some national indices show only a 3-4% annual increase in overall installed remodeling costs, several key material categories tell a more intense story. Concrete prices rose about 13.9% year-over-year in Verisk’s Q3 2024 reconstruction-cost analysis. Metal inflation has been similarly sharp, with steel and aluminum used in hardware and fixtures- including railings, gates, bath accessories, cabinet hardware, and door components- climbing 16.7% year-over-year. Even electrical materials saw increases, with power wires and copper-based electrical cable increasing about 7% year-over-year. Taken together, rising material costs paired with ongoing labor tightness underline that remodeling cost pressures remain significant despite more moderate headline averages.

According to the Qualified Remodeler Top 500 report, the Midwest is seeing a trend of homeowners choosing to stay and reinvest in the home they already love, rather than selling- especially those fortunate enough to be holding onto a 2–3% mortgage rate. And even for those with current rates, today’s 6–7% mortgages are still among the lowest many of us will see in our lifetimes when viewed across the last 30 years. Renovating instead of relocating remains a smart choice for families seeking to maximize function and long-term equity.

Despite fluctuating market conditions, one truth remains constant: it’s worth investing in your home today rather than waiting longer. Remodeling costs historically rise over time, even in years when things seem to stabilize. We often see clients who explored a project with us several years ago, chose to put it on hold, and then return to find that the cost to complete the very same project has increased significantly. It’s a powerful reminder that while delaying may feel practical in the moment, it can lead to much higher investment later.

Acting sooner rather than waiting- and moving forward with renovation plans while pricing is current- allows homeowners to secure today’s costs and begin enjoying their new spaces much sooner.

Our focus remains on helping you maximize value while keeping every project grounded in clear expectations and smart decision-making. We’ve continued to navigate these shifting conditions through long-standing vendor relationships, transparent scheduling, thoughtful design, and strategic material planning.

Staying True to the Single-Source Approach

Our Single Source Responsibility system continues to be the heartbeat of who we are. For more than three decades, we’ve refined a process where one unified team guides you from the first design conversation to the final day on site. It is a seamless, highly communicative approach where designers, project managers, field craftsmen, and specialty partners operate as one coordinated unit. Instead of juggling independent designers, contractors, and trades, you gain a fully integrated team that shares information, anticipates challenges, and takes complete ownership of your remodeling experience. This eliminates the common disconnects and frustrations of traditional remodeling and replaces them with a smoother, more predictable, and far more enjoyable process.

What makes this system truly special is the people behind it. Our designers are with you from the very beginning and ensure your vision carries through each step of the journey. Our hands-on construction managers remain deeply involved from start to finish, bringing accountability and clarity to the build. Our dedicated field crew delivers consistency and craftsmanship on every job site, and we’ve partnered with several of our specialty trades for 10-20+ years. All of these trusted professionals understand our standards and values. This depth of connection and shared experience is rare in the remodeling industry, and it’s one of the reasons we can confidently deliver exceptional results time and time again.

Every project we complete is the result of many hands, many conversations, many hours, and a shared commitment to doing things the right way. We are proud of the transformations we created this year, but we’re equally proud of the collaboration and dedication that made them happen.

2026 Home Remodeling Trends

According to Qualified Remodeler, the design-build industry in 2026 will be shaped by three key project types: whole-home remodels, kitchens, and baths. This tells the story that many families are choosing to invest in their current homes rather than relocate, often tackling larger-scale renovations that reimagine multiple rooms at once. Many families are preparing their homes for multi-generational living with 2nd story additions and other large-scale buildouts, whether to accommodate ageing parents or to create more functional spaces for teens and young adults who are living at home longer.

The classics remain as important as ever, too: new kitchens and primary baths continue to be among the most impactful upgrades, offering both more functional enjoyment and significant long-term home value. We are also completing many multi-room renovations, especially in aging homes where flooring, millwork, lighting, and secondary rooms like laundry areas or guest baths need comprehensive updates.

As homes continue to evolve, we’ve seen strong demand for spaces that add functionality, comfort, and value. Seasonal rooms that allow families to enjoy additional square footage right in the backyard year-round have become increasingly popular. Basements continue to transform into highly functional, beautifully finished living areas—complete with entertainment zones, kitchen/bar options, fitness rooms, and offices to maximize existing square footage.

To stay up to date on current and future trends and see our ongoing projects behind the scenes, subscribe to our remodeling blog.

Thank you

2026 marks our 34th year in business, and we’re entering this milestone with optimism. Homeowners continue to invest in more functional, personalized spaces, and the desire to reimagine homes is stronger than ever. The coming year is full of opportunities to create something extraordinary, and our commitment to helping clients enhance their homes remains stronger than ever.

We’re also hosting a Holiday Giveaway, giving homeowners the chance to win some exciting prizes and a special chance to win up to $5,000 cash back if you have a project planned for early 2026. It’s our way of adding a little extra excitement as you take the next step toward a home you’ll love even more.

From our entire team, thank you for making 2025 such a meaningful year. We look forward to helping you create spaces that make your home truly one-of-a-kind. If a 2026 renovation is your goal, we encourage you to reach out soon. Beginning the conversation now gives us the best chance to fit your project into our calendar. We’re here to help you plan thoughtfully, understand costs, and make confident decisions that match your goals.

The Advance Design Studio Team