Hardwood Floors August/September 2025

INDUSTRY INSIGHTS

MARKET MATTERS

The overall U.S. economy is expected to grow slowly during this early period of economic uncertainty in 2025 and 2026 and then grow at a moderate rate thereafter. Consumer spending will continue to drive the economy, growing throughout the forecast period. This economic forecast is projecting real gross domestic product (GDP) growth in 2025 to be 1.3 percent, consumer spending SLOW GROWTH DURING ECONOMIC UNCERTAINTY

rising 2.1 percent, and inflation at 3.2 percent. Key assumptions underlying this forecast:

• Strong consumer demand continues to support economic activity, though uncertainties around tariffs and government policies will slow growth in the near term. • New home construction in 2025 will continue to be constrained by affordability issues, mainly affecting younger buyers. As consumer income and employment rise in 2026

and beyond, housing starts will rise above 1.5 million units annually. Existing home sales will face moderate challenges in 2025 from the same affordability issues as new home construction.

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