Three Out of Four Sectors Expect Moderate Growth this Year Despite Ongoing Challenges, According to 3Q26 Kitchen & Bath Market Index (KBMI) Report
By NKBA Editorial Staff
Kitchen & bath professionals say industry conditions are slowly improving, according to the findings of the new 3Q26 Kitchen & Bath Market Index (KBMI) Report. While residential kitchen and bath sales conditions strengthened in 3Q26 on both a QOQ and YOY basis, pros rated the economic health of the industry as relatively flat over the past year.
The KBMI rose to 54.5, up from 52.7 last quarter and a cycle low of 50 a year ago as all four KBMI segments upgraded their KBMI rating in 3Q26, although the design segment remains weaker than the rest. Rising costs and consumer uncertainty remain key barriers to growth across sectors.
The 3Q26 report, conducted jointly by the National Kitchen & Bath Association
and John Burns Research and Consulting, surveyed 494 NKBA members in four segments: design, building and remodeling, retail, and manufacturing.
Here are some of the most significant findings:
Consumer Uncertainty Continues to Limit Growth
Once again, consumer uncertainty was most frequently cited by K&B professionals (53%) as the most significant inhibitor of growth. Rising building costs and tariffs/trade issues were also frequently cited, each by 44% of respondents. Nearly one-third of those surveyed (30%) said the skilled labor shortage is also a key constraint.
Design Sector Struggles to Revive
Surveyed designers said sales decreased -2% YOY in 3Q26 and project completions fell -4.0% YOY. Nearly one-third (30%) of design firms reported trade-downs to lower-grade products. Design firms expect -1% growth in 2026, on average, down from +2% in 2Q26. In contrast, the three other surveyed sectors expect 4-5% revenue growth this year.
Tariffs are Impacting Pricing
K&B firms report that their pricing rose +5.1% YOY on average, indicating that tariff impacts on key products are again rising. Builders and remodelers expect to pass along those higher costs by raising prices most significantly in 2026, while designers and retailers project more modest increases.
Luxury Projects Keep Moving Forward
In a continuing trend, demand is largely driven by luxury projects, as midrange clients postpone or trade down. A significant percentage of spending is coming from homeowners who planned and saved, need-based repairs and owners staying in their homes because of their low existing mortgage rates. However, even affluent consumers are seeking value, as midrange product demand again edged out luxury in 3Q26.
“It’s encouraging to see even modest expansion in the face of these uneven market conditions,” said Bill Darcy, Global President & CEO of NKBA | KBIS. “Higher prices and persistent consumer uncertainty are difficult barriers to overcome, but our industry continues to adapt and leverage growth opportunities when and where they’re available.”
To learn more about key dynamics impacting the Kitchen & Bath Industry, download the full 3Q26 Kitchen & Bath Market Index (KBMI) Report.
