Truist Release Construction Outlook for H2 2025

Charlotte, NC, July 25, 2025-Truist released the following outlooks for residential single-family (SF) construction, residential remodel and commercial construction in the second half of 2025.

“Residential SF New Construction Activity Headed Toward High Single Digit/Low Double Digits in H2 2025: The combination of housing starts results and even weaker sales numbers from public homebuilders have shown that the mid-single digit decline view of last earnings season has gotten incrementally worse. We believe the housing starts market weakness will most likely spill into early 2026. The clear issue is affordability as home price growth the last few years and mortgage rates that have hovered between 6.5% to 7% have pushed many buyers out of the market. Regardless, the massive deceleration in multi-family seems to have subsided with a bottom found.

“Remodel Remains Down, But Not Sure it is Decelerating: Commentary from the remodel industry has also been weak since the tariff implementation as some early recovery signs were squashed with the news. While tariff concerns seem to be fading away somewhat regarding consumer confidence, we still have picked up on small anecdotal commentary of any real improvement in business. Regardless, we believe that demand levels have not gotten much worse and the market is bottoming at low to mid-single digit falls. We always watch the remodel market closely as demand can shift very quickly. The chart below shows a very good representation of what remodel has done.

“Commercial Remains Mixed Bag But Better: Commercial construction has seen some deceleration in areas, but the heavy work on reshoring, data centers, and other less cyclical areas like healthcare and government have prevented a substantial downturn so far. Demand here is far more closely related to GDP growth, which has remained positive and prevented the big decline seen in the residential markets. Regardless, the sector is still not hitting its full potential until pressures in some areas, such as the office market, turn.”