These 4 trends are shaping Long Island's home remodeling market in 2025
Joe Persico, right, president of Hy-Grade Contractors Corp. in Bohemia, oversees a project with his son Joe Persico Jr., left, and contractor Jessica Andrade as Long Island's remodeling season kicks off. Credit: Rick Kopstein
As the busy spring season for home remodeling gets underway, Joe Persico said his company is already booked through the end of the year on large-scale renovation projects.
Persico, president of Hy-Grade Contractors Corp. in Bohemia, said he has seen consistent demand for projects that can cost more than $100,000 but fewer jobs in smaller houses that might need just a single bathroom updated.
“For incoming work, the smaller scale has definitely slowed off,” Persico said. “The projects we’re seeing now are full home renovations, high-end bathroom remodels and high-end kitchen remodels.”
Long Island housing industry experts and contractors told Newsday they are optimistic that the region's aging housing stock and limited supply of for-sale homes would boost the remodeling business this year. But a new national report released Thursday suggested several factors, including tariffs and elevated interest rates, could make homeowners think twice about starting projects.
In its report, the Harvard Joint Center for Housing Studies projected remodeling spending will increase 1.1% in 2025 to $608 billion.
That’s well below the historical average growth rate of about 5% and follows several years during the pandemic when spending soared, said Sophia Wedeen, a senior research analyst at the Harvard Joint Center for Housing Studies.
However, Long Island's high incomes and surging home prices provide a stronger underpinning for the remodeling market, she said.
Big-ticket projects make up a greater share of spending in the metropolitan area than in the rest of the country, according to the report. About 59% of owners reported spending at least $50,000 on remodeling compared with 44% in the rest of the country.
“Any place that has high incomes and high home values the way Long Island does has strong fundamentals for sustained remodeling activity,” Wedeen said.
Here are four factors that will affect the remodeling industry this spring.
President Donald Trump’s tariff policies stand to increase the price of construction materials, such as lumber, steel and aluminum.
Those tariffs represents an added cost for homeowners, who spent $25.1 billion on remodeling in the metropolitan area in 2023, according to the Harvard report.
“That’s going to flow downhill,” said Mike Florio, CEO of the Long Island Builders Institute, which represents home builders and remodelers. “The materials they’re looking to procure to do the project are going to cost more and the end user is going to be the one paying that.”
Gina Farese, CEO of roofing contractor Marcor Construction in West Babylon, said she's hopeful higher costs on supplies such as nails and aluminum products will be short-lived as they were during pandemic-era supply chain disruptions. But she cautioned homeowners should be wary of contractors looking to cut costs by, for example, reducing the number of nails used per shingle, which could void a manufacturer’s warranty.
“Because of the cost going up, there’s a lot of people that are trying to find ways to cut corners,” she said.
Higher interest rates have made borrowing to finance home improvement projects more expensive in recent years.
The national average rate for a home equity line of credit fell to 8.03% as of Wednesday, according to a survey of large lenders from personal finance website Bankrate.
While that's an improvement from last year, borrowers are still paying a rate that's about double the average from three years ago, said Stephen Kates, a financial analyst at Bankrate.
Kates said he doesn't expect a substantial improvement for borrowers this year.
“We’re not likely to see a quick decrease to rates unless we have a recession, which we do not expect,” Kates said.
Home equity lines offer an attractive alternative to refinancing a mortgage at today’s rates, said Vittorio Scafidi, vice president of lending at Jovia Financial Credit Union in Westbury.
“With mortgage rates being so high, this is everyone’s go-to right now,” Scafidi said.
Homeowners prepping houses for sale and buyers making renovations before moving in typically spend more than the average homeowner on projects, so when market activity falls, that hurts the remodeling industry, Wedeen said.
The number of home sales in the 10 New York City area counties covered by OneKey MLS, including Nassau and Suffolk, fell 2.5% last year compared to 2023. Sales were down by about one-third from 2021, according to data from the multiple listing service.
Scafidi said Long Islanders who don’t like their options in the for-sale market may opt to build instead.
“Unfortunately, on Long Island there’s a very limited inventory of homes,” Scafidi said. “That’s why a lot of people are forced to [say], ‘OK, we haven’t been able to find anything in our price range, so now let’s look to renovate or build upon what we have.’ ”
Long Island’s aging housing stock is older than the typical American home, which generates significant spending on repairs.
The median Nassau County home was built in 1955, while the median Suffolk County home was built in 1970, according to 2023 data from the U.S. Census Bureau’s American Community Survey.
The typical U.S. home was built in 1981.
While Persico said he most often works on homes built between the 1950s and 1970s, even newer houses built as recently as 2000 are coming due for updates, creating plenty of work for contractors.
“If you had a home built in 2000, chances are it can use a bathroom, a kitchen, definitely a roof,” Persico said. “So that age is definitely starting to creep up.”
As the busy spring season for home remodeling gets underway, Joe Persico said his company is already booked through the end of the year on large-scale renovation projects.
Persico, president of Hy-Grade Contractors Corp. in Bohemia, said he has seen consistent demand for projects that can cost more than $100,000 but fewer jobs in smaller houses that might need just a single bathroom updated.
“For incoming work, the smaller scale has definitely slowed off,” Persico said. “The projects we’re seeing now are full home renovations, high-end bathroom remodels and high-end kitchen remodels.”
Long Island housing industry experts and contractors told Newsday they are optimistic that the region's aging housing stock and limited supply of for-sale homes would boost the remodeling business this year. But a new national report released Thursday suggested several factors, including tariffs and elevated interest rates, could make homeowners think twice about starting projects.
WHAT NEWSDAY FOUND
A national report projected a 1.1% increase in spending on home remodeling this year, below the historical average of 5%, according to the Harvard Joint Center for Housing Studies.
Elevated interest rates, tariffs on building materials and fewer home sales are among the factors that could make homeowners more reluctant to spend on remodeling.
But Long Island's high incomes and its aging housing stock help fuel new spending, and local home remodelers said they remain busy.
In its report, the Harvard Joint Center for Housing Studies projected remodeling spending will increase 1.1% in 2025 to $608 billion.
That’s well below the historical average growth rate of about 5% and follows several years during the pandemic when spending soared, said Sophia Wedeen, a senior research analyst at the Harvard Joint Center for Housing Studies.
However, Long Island's high incomes and surging home prices provide a stronger underpinning for the remodeling market, she said.
Big-ticket projects make up a greater share of spending in the metropolitan area than in the rest of the country, according to the report. About 59% of owners reported spending at least $50,000 on remodeling compared with 44% in the rest of the country.
“Any place that has high incomes and high home values the way Long Island does has strong fundamentals for sustained remodeling activity,” Wedeen said.
Here are four factors that will affect the remodeling industry this spring.
Tariffs drive up materials costs
President Donald Trump’s tariff policies stand to increase the price of construction materials, such as lumber, steel and aluminum.
Those tariffs represents an added cost for homeowners, who spent $25.1 billion on remodeling in the metropolitan area in 2023, according to the Harvard report.
“That’s going to flow downhill,” said Mike Florio, CEO of the Long Island Builders Institute, which represents home builders and remodelers. “The materials they’re looking to procure to do the project are going to cost more and the end user is going to be the one paying that.”
Gina Farese, CEO of roofing contractor Marcor Construction in West Babylon, said she's hopeful higher costs on supplies such as nails and aluminum products will be short-lived as they were during pandemic-era supply chain disruptions. But she cautioned homeowners should be wary of contractors looking to cut costs by, for example, reducing the number of nails used per shingle, which could void a manufacturer’s warranty.
“Because of the cost going up, there’s a lot of people that are trying to find ways to cut corners,” she said.
Elevated interest rates
Higher interest rates have made borrowing to finance home improvement projects more expensive in recent years.
The national average rate for a home equity line of credit fell to 8.03% as of Wednesday, according to a survey of large lenders from personal finance website Bankrate.
While that's an improvement from last year, borrowers are still paying a rate that's about double the average from three years ago, said Stephen Kates, a financial analyst at Bankrate.
Kates said he doesn't expect a substantial improvement for borrowers this year.
“We’re not likely to see a quick decrease to rates unless we have a recession, which we do not expect,” Kates said.
Home equity lines offer an attractive alternative to refinancing a mortgage at today’s rates, said Vittorio Scafidi, vice president of lending at Jovia Financial Credit Union in Westbury.
“With mortgage rates being so high, this is everyone’s go-to right now,” Scafidi said.
Fewer home sales, fewer movers
Homeowners prepping houses for sale and buyers making renovations before moving in typically spend more than the average homeowner on projects, so when market activity falls, that hurts the remodeling industry, Wedeen said.
The number of home sales in the 10 New York City area counties covered by OneKey MLS, including Nassau and Suffolk, fell 2.5% last year compared to 2023. Sales were down by about one-third from 2021, according to data from the multiple listing service.
Scafidi said Long Islanders who don’t like their options in the for-sale market may opt to build instead.
“Unfortunately, on Long Island there’s a very limited inventory of homes,” Scafidi said. “That’s why a lot of people are forced to [say], ‘OK, we haven’t been able to find anything in our price range, so now let’s look to renovate or build upon what we have.’ ”
Aging homes
Long Island’s aging housing stock is older than the typical American home, which generates significant spending on repairs.
The median Nassau County home was built in 1955, while the median Suffolk County home was built in 1970, according to 2023 data from the U.S. Census Bureau’s American Community Survey.
The typical U.S. home was built in 1981.
While Persico said he most often works on homes built between the 1950s and 1970s, even newer houses built as recently as 2000 are coming due for updates, creating plenty of work for contractors.
“If you had a home built in 2000, chances are it can use a bathroom, a kitchen, definitely a roof,” Persico said. “So that age is definitely starting to creep up.”
Jonathan LaMantia covers residential real estate and other business news on Long Island. He previously covered the business of health care for Crain's New York Business.
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