Wary consumers, low housing turnover weighing on home improvement spending: Home Depot

Home Depot on Tuesday reported a nearly four percent year-over-year sales decline in the fourth quarter of 2025, with executives flagging anxious consumers and a sluggish housing market as factors depressing home improvement spending. 

What they’re saying: “Housing turnover has remained at historical lows since 2023, which has significantly reduced demand for projects and other purchases associated with buying and selling a home,” CFO Richard McPhail said on the company’s earnings call. 

• “Our customers also tell us they have concerns over general economic uncertainty, including inflation, growing job concerns, and higher financing costs,” he added. “As we look ahead to fiscal 2026, we anticipate these pressures will persist, as we have not yet seen a catalyst for an inflection in housing activity.”

Of note: Sales of existing homes result in HVAC system changes “usually” 20 to 25 percent of the time, according to Carrier estimates.

Go deeper: CEO Ted Decker noted that continued consumer uncertainty is “still the number one reason” customers say they’re not investing in large projects. “That has everything to do with consumer confidence and sentiment, jobs picture… price levels and affordability in the economy,” he said. 

• Between the lines: There’s $22 billion “that people have underspent in the aging home,” Decker said, referring to third-party estimates, adding that low housing turnover has kept homeowners in “more of a repair than a replacement cycle.”
• “I don’t necessarily think that’s gonna get any worse, but we’re certainly bouncing along what we hope would be a bottom in things like turnover.”