I expect 2026 to be shaped by a combination of restrained demand and structural constraints. Higher-for-longer interest rates will continue to suppress discretionary new construction, particularly in single-family housing, while remodeling and repair activity remains more resilient. From a macro standpoint, the industry is transitioning from a volume-driven cycle to a margin- and efficiency-driven one, in which fewer projects move forward, but those that do are more carefully underwritten.
Financing conditions will play a decisive role in shaping demand. Even modest rate cuts may not unlock a surge in new builds, but they could support incremental improvements in homeowner sentiment, especially for remodeling and energy-efficiency upgrades. I see green retrofits, electrification, and code-driven upgrades as some of the most resilient segments because they're increasingly driven by regulation, incentives, and long-term operating cost savings rather than pure discretionary spending.