Tax refunds to fund remodels
Remodeling sentiment dipped slightly in Q1 but stayed well above neutral, as homeowners prefer improving in place amid higher mortgage rates (nationalmortgagenews.com). Ask Angi recommends using tax refunds to fund home repairs or upgrades without adding new debt, citing Angi’s 2025 State of Home Spending as context for that advice (dailygazette.com).
Homeowners are still spending on remodels this spring, and tax refunds are being pitched as a way to cover smaller projects without taking on new debt. (nahb.org) (msn.com) The National Association of Home Builders said its Remodeling Market Index came in at 62 in the first quarter of 2026, down 2 points from the prior quarter but still above the 50 line that marks more remodelers calling conditions good than poor. The group’s Current Conditions Index was 70, while its Future Indicators Index was 54. (nahb.org) Large remodeling jobs of $50,000 or more scored 67, moderate projects between $20,000 and $50,000 scored 69, and small projects under $20,000 scored 74 in the first-quarter survey. Leads and inquiries measured 53, and remodeler backlogs measured 55. (nahb.org) The trade group tied that resilience to two forces: an aging housing stock and the “lock-in effect” from elevated mortgage rates that keeps owners from moving. National Mortgage News reported April 13 that remodelers see higher rates as a drag on home sales but not a collapse in renovation demand. (nahb.org) (nationalmortgagenews.com) Angi has been making a narrower argument: use refund money for repairs or practical upgrades first. In its 2025 State of Home Spending Pulse survey of 1,000 homeowners, 71% said they had postponed a planned home project, and 71% said they were prioritizing preventative maintenance to avoid bigger bills later. (angi.com) That same Angi survey found 62% of homeowners were more concerned about affording maintenance than they were at the end of 2024, and 48% said stress from mandatory repairs had increased since January 2025. Bathroom remodels, interior painting, and window replacements were among the most commonly delayed projects. (angi.com) Tax refunds are larger than a year ago, which helps explain the pitch. Internal Revenue Service filing statistics through April 3 showed an average refund of $3,462, up 11.1% from $3,116 a year earlier, with the average direct-deposit refund at $3,454. (irs.gov) For many owners, that amount will not cover a full kitchen or major addition, but it can cover a roof repair, appliance replacement, insulation work, or part of a bathroom update. Angi’s advice was to start with safety issues, water damage, and systems that can fail expensively if they are ignored. (msn.com) Some upgrades can also reduce next year’s tax bill if they qualify for federal energy credits. TurboTax said the Energy Efficient Home Improvement Credit can be worth up to $1,200 per year for eligible improvements, while the Residential Clean Energy Credit applies to equipment such as solar, wind, and geothermal systems. (turbotax.intuit.com) Angi’s 2025 spending report also found 74% of Millennials said mortgage rates were influencing them to improve their current home instead of moving. That leaves this year’s refund season looking less like a shopping spree and more like a down payment on staying put. (marketscreener.com)
