Remodeling Profit Margins Reach Highest Level Since 1996

Profitability for residential remodelers reached its highest level in nearly 30 years in 2024, the NAHB’s reported April 10 in its newest Remodelers’ Cost of Doing Business Study. Housing affordability issues have pushed homeowners to upgrade their homes rather than enter the housing market.

In 2024, the average net profit margin for remodelers was 6.3%, the highest since 1996 and up sharply from a 3% average net profit margin in 2011.

Remodelers’ 29.9% average gross profit margin in 2024 was a solid five percentage points higher than in 2021, when the metric sank to a record low of 24.9%. The improvement was due in large part to a significant reduction in trade contractor costs, which dropped from 36% of revenue in 2021 to 30% in 2024.

In addition to increased demand for their services, professional remodelers have focused more on best practices in business management and accounting.

The survey data shows remodelers’ balance sheets expanded significantly in 2024, with average total assets ($668,000) up 34% compared to 2021 ($497,000). But perhaps more importantly, the data points to remodelers increasingly deleveraging their businesses in the last decade.

In 2015, 68% of remodelers’ assets were financed through debt. By 2021, that share was down to 49%, where it remained essentially unchanged in 2024 (50%). Remodelers are using more of their own capital to run their companies, as illustrated by their equity share rising from 33% in 2015 to 50% in 2024.

Fine more data about remodelers’ various cost of sales lines (share of revenue spent on materials), operating expenses (how much owners were paid as compensation), and types of assets in the official publication of the 2026 Remodelers’ Cost of Doing Business Study.