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Housing starts, mortgage rates, and remodeling forecasts help explain different parts of the U.S. home-improvement market, but none predicts Home Depot or Lowe’s share price on its own. Starts track new construction; mortgage rates influence home-buying affordability and turnover; remodeling spending reflects work on existing homes. Retailer results also depend on who is shopping, what they are buying, and how each company executes.
What the three housing indicators currently say
The latest figures point in different directions and cover different time frames. The Census Bureau’s monthly starts estimate is an annualized rate, Freddie Mac’s mortgage figure is a weekly survey average, and Harvard’s remodeling number is a forecast for a future quarter—not three interchangeable readings of the same market.
| Indicator | Latest cited reading | What it measures | Key limitation |
|---|---|---|---|
| Housing starts | 1,275,000 privately owned units at a seasonally adjusted annual rate in August 2026; down 2.6% from revised July 2026 and 1.2% from August 2025. Single-family starts were 918,000. (U.S. Census Bureau and HUD, August 2026 release) | New residential construction activity, including single- and multifamily units. | A monthly estimate that can be revised; it is not a count of retailer purchases or remodeling work. |
| 30-year fixed mortgage average | 7.28% on October 1, 2026; 7.03% on September 24 and 6.76% on September 10. (Freddie Mac weekly survey) | A weekly average based on rates collected from mortgage applications submitted through Loan Product Advisor by lenders across the country. | It is a survey average, not the rate every borrower receives or a complete measure of financing costs. |
| Remodeling and repair spending | 0.5% year-over-year growth expected in 2027 Q2. (Harvard Joint Center for Housing Studies, July 23, 2026 forecast) | Forecast growth in annual home-improvement and repair spending. | It forecasts slower growth, not falling spending, and it is not a retailer-sales forecast. |
The Census Bureau defines a housing start as the point when excavation begins for a building’s footings or foundation. Its monthly figure is expressed at a seasonally adjusted annual rate, so 1,275,000 is not the number of homes begun during August alone.
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More construction can create demand for materials, fixtures, appliances, and finishing products as homes are built and completed. That can matter to retailers serving builders, contractors, and other professional customers. But starts are an activity indicator, not a direct tally of orders placed with any one retailer; the timing and size of purchases depend on construction stages, customer relationships, and product mix.
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The August 2026 decline therefore signals softer starts relative to the comparison periods, not a measured decline in Home Depot or Lowe’s sales. A single monthly reading also does not establish a durable trend, particularly when estimates can be revised.
How mortgage rates can affect demand
Higher mortgage rates can make home purchases less affordable and may reduce housing turnover. Fewer moves could mean fewer move-related projects—such as furnishing, repair, or renovation after buying a home. The reverse channel is also plausible: households that remain in existing homes longer may choose to maintain or improve them instead of moving. These are mechanisms to consider, not causal effects established by the cited statistics.
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Freddie Mac’s October 1, 2026 average of 7.28% followed readings of 7.03% a week earlier and 6.76% on September 10, showing that the survey measure can move meaningfully over a short period. It should not be treated as an individual shopper’s borrowing cost: a borrower’s actual rate depends on their circumstances and loan terms, which this weekly average does not capture.
Why remodeling is a separate demand channel
Remodeling and repair spending concerns existing homes, so it can support home-improvement sales even when new construction is weak. Harvard’s Joint Center for Housing Studies forecast annual growth in this spending to slow to 0.5% in 2027 Q2. That is a forecast of continued, but very modest, growth—not a prediction that spending will contract.
The Center’s July 23, 2026 release said, “Growth in remodeling permitting and retail spending on building products have flattened recently, suggesting that renovation activity is cooling,” according to Rachel Bogardus Drew, Director of the Remodeling Futures Program. The forecast describes the remodeling market broadly; it does not specify how much revenue any retailer will gain or lose.
What Home Depot and Lowe’s results illustrate
Fiscal Q2 2026 results show why broad housing indicators do not translate mechanically into identical retailer outcomes. Both companies reported positive comparable-sales growth, but their releases described different demand components. Comparable sales measure sales at comparable locations under each company’s reporting method; they are not the same as total sales growth.
| Retailer and period | Reported result | Demand mix or context disclosed by the company |
|---|---|---|
| The Home Depot, fiscal Q2 2026 | Sales were $47.9 billion, up 5.7% year over year. Comparable sales rose 1.7%; U.S. comparable sales rose 1.3%. | The company cited broad-based demand and smaller projects. It reaffirmed fiscal 2026 guidance. |
| Lowe’s, fiscal Q2 2026 | Comparable sales rose 0.2%. | The company said Pro and home-services performance and a 15.7% increase in online sales supported growth, partly offset by persistent DIY macro pressures. |
Home Depot CFO Richard McPhail said, “Our second quarter results exceeded our expectations. We saw broad based demand across the business as customers continued to engage in smaller projects.” Lowe’s disclosure, by contrast, highlighted Pro and services strength alongside pressure on DIY demand. These company-specific explanations show that project size, customer type, services, online sales, and execution can matter alongside housing conditions.
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Investors price expectations about future results, not just the latest housing release or quarterly sales figure. If a development is already reflected in market expectations, even a notable data point may not move a stock as expected. Margins, product mix, labor and freight costs, tariffs, competition, acquisitions, company guidance, and valuation can also influence share prices.
The Home Depot’s release identifies housing and credit markets, interest rates, tariffs, competition, costs, and guidance among risks and forward-looking factors. The cited sources do not provide a regression, event study, or sensitivity estimate that connects a change in starts, mortgage rates, or remodeling spending to a specified percentage move in Home Depot or Lowe’s shares. The Q2 examples illustrate different operating demand mixes; they do not establish what caused either stock’s returns.
Quick Recap
A practical way to read new housing data
- Match the measure to its cadence. Treat mortgage averages as weekly observations, starts as monthly estimates that can be revised, and remodeling projections as forecasts for a stated future period.
- Match it to the housing segment. Starts concern new construction; remodeling spending concerns existing homes. Mortgage rates can influence purchases and moves, with possible effects on both channels.
- Check the horizon and direction. Separate a current reading from a forecast. Slower growth, as in Harvard’s 2027 Q2 outlook, is not the same as a fall in spending.
- Compare retailer disclosures, not just the headline data. Look at comparable sales and the company’s explanation of DIY, Pro, services, online sales, project size, and guidance for the same fiscal period.
- Keep the stock question separate from the demand question. Housing data can inform a business outlook, but a share-price view also needs expectations, costs, competition, margins, and valuation. The available figures do not quantify a stock-price response.
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