The Home Improvement Research Institute (HIRI) announced findings from its latest U.S. Size of the Home Improvement Products Market report, including a revised downward forecast in 2025 due to sustained macroeconomic challenges.

The home improvement market as a whole reached $574.3 billion last year and is now projected to grow by 3.4% in 2025, a reduction from the 5.0% growth projected in HIRI’s March outlook.

The forecast also revealed a change in anticipated growth rates in the professional and consumer markets. Consumer market sales growth in current dollars is expected to grow by 2.6% in 2025, down from the 4.9% forecast in March. Professional market sales are projected to grow faster at 4.9% in 2025, expected from the March forecast.

“While our latest forecast reflects some near-term adjustments due to economic headwinds, the long-term picture for the home improvement market remains one of significant opportunity,” says Dave King, executive director of HIRI. “Looking out over the next five years through 2029, we anticipate a net gain in total market spend of roughly $300 billion in additional spend. While this growth is expected to be stronger toward the latter half of the period, it reflects that the underlying appetite and demand for home improvement projects are still robust.”

The report also mentions a 35% probability of a pessimistic scenario, including a two-quarter recession in mid-2025.

The revised outlook is based on a few specific economic factors, including rising costs and tariffs, housing market challenges, slowing consumer spending and income growth and a cooling labor market.