Houzz has released its Q3 2026 U.S. Houzz Pro Industry Barometer, which indicates an increase in confidence and business expectations among U.S. design and construction firms as they enter the third quarter.

The report, based on responses from 947 firms surveyed between July 2 and July 8, shows that both architects and designers expect greater business activity in Q3 2026. The Expected Business Activity Indicator for the design sector rose by 8 points to 68. Project inquiries for this segment increased to 67, and new committed projects reached 69. Among architects, the indicator climbed to 71, while it eased slightly among interior designers to 63.

Backlogs for design firms shortened to 4.7 weeks, down from 5.9 weeks a year ago, driven largely by architects (5.1 weeks, down from 6.7). Interior designers reported backlogs of 3.9 weeks compared with 4.4 weeks in Q3 2025.

For construction firms, the Expected Business Activity Indicator increased by 3 points to 61 for Q3. Greater expectations for project inquiries (up to 61) and a slight increase in new committed projects (up to 60) contributed to this rise. Build-only remodelers reported improved outlooks, while design-build firms reported a slight decline in expectations. Project backlogs overall remained steady at 6.1 weeks, with build-only remodelers at 6.0 weeks and design-build firms at 6.2 weeks.

Recent business activity varied by sector. In Q2, the design sector’s Recent Business Activity Indicator rose by 14 points to 62, spurred by increased project inquiries. The construction sector saw a slight decline to 47, with stable project volumes but some softening in inquiries.

As businesses navigate ongoing market pressures, including rising product and labor costs, client financial uncertainty, and higher fuel expenses, firms are adapting strategies. Construction and design companies most commonly reported raising prices, being more selective about projects, adjusting timelines, and focusing on repeat business and referrals. Nearly all respondents (92% of construction firms and 90% of design firms) anticipate continued pressures in the coming quarter, with maintaining profitability remaining a concern.

The Q3 2026 barometer and methodology details are available here. The survey tracks indicators on a diffusion basis, where values above 50 indicate more firms reporting increased activity than decreased.

Source: furninfo.com