Key Takeaways
- Home renovation demand remains strong in 2026, but homeowners are far more cautious about how they pay for projects.
- Elevated interest rates have made refinancing and new loans less appealing, especially for owners with low existing mortgage rates.
- Many homeowners are prioritizing renovations that improve livability and long-term value, without taking on another monthly payment.
- Alternatives like equity sharing are gaining attention for homeowners who want funding flexibility without adding debt.
How Homeowners are Renovating in 2026
Even in an uncertain housing market, homeowners continue to invest in their homes — not necessarily to flip them, but to make them more functional, efficient, and comfortable.
In 2026, renovations are less about luxury upgrades and more about:
- Fixing aging systems
- Improving energy efficiency
- Adapting homes for long-term livability
- Avoiding the cost and stress of moving
For many households, staying put and improving what they already own feels like the safer choice.
Top Home Renovation Trends Homeowners Are Prioritizing
While trends vary by region, several renovation categories consistently rise to the top in 2026:
Functional kitchen and bathroom updates
Not full redesigns, but practical upgrades that improve usability, storage, and energy efficiency. These projects tend to hold value well and make everyday life easier.
Energy-efficient improvements
Windows, insulation, HVAC upgrades, and solar-adjacent improvements are popular as homeowners look to lower ongoing utility costs and future-proof their homes.
Aging-in-place modifications
As more homeowners plan to stay long-term, or transition towards multi-generational living, renovations that support mobility, safety, and accessibility are becoming more common.
Maintenance-driven projects
Roof repairs, foundation work, plumbing, and electrical updates may not be glamorous — but they protect home value and prevent much larger costs later.
Which Renovations Tend to Boost Home Value the Most?
Not all renovation dollars are invested equally. In general, homeowners see stronger long-term value from projects that:
- Improve core living spaces (kitchens, bathrooms)
- Increase efficiency or reduce operating costs
- Address deferred maintenance
- Improve the home’s overall condition rather than niche personalization
That said, many homeowners in 2026 aren’t renovating purely for resale value. Given the market landscape, most are renovating to simply make their home work better right now.
Why Refinancing Isn’t the Go-To Renovation Strategy in 2026
In previous years, cash-out refinancing was a common way to fund home improvements. But that calculus has changed.
Today, many homeowners face:
- Higher interest rates than their existing mortgage
- The risk of resetting their low first-mortgage rate
- The potential for higher monthly payments that strain already-tight budgets
For homeowners who locked in low rates years ago, refinancing to fund renovations can feel like taking one step forward and two (or more) steps back.
How Homeowners Are Funding Renovations Without Refinancing
Instead of refinancing, homeowners in 2026 are exploring alternatives that offer flexibility without increasing monthly obligations.
Paying with savings (where possible)
Some homeowners fund smaller projects with cash, though rising living costs limit how far savings can go.
Traditional equity loans or HELOCs
These can still work for some, but higher rates (which are often variable in the case of HELOCs) and recurring monthly payments make them less attractive for homeowners prioritizing cash flow in the short term.
Equity sharing agreements
One increasingly discussed option is an equity sharing agreement, like those offered by Unison. With this approach, homeowners receive upfront cash for renovations without taking on interest or monthly payments.
Instead of paying interest over time, homeowners agree to share a portion of their home’s future value when the agreement ends — whether that’s when the home is sold or the agreement is settled.
In other words, equity sharing isn’t free money. There’s a clear trade-off: homeowners give up a share of future appreciation (and in certain cases, the depreciation) in exchange for immediate access to equity and opting out completely from interest rates, monthly payments, and debt, in the traditional sense.
This structure can appeal to homeowners who want to preserve cash flow, avoid refinancing into a higher rate, and fund impactful improvements — while fully understanding that the cost shows up down the road, rather than at the end of each month. It’s not the right fit for everyone, but for many homeowners in 2026, it offers a different way to move forward without adding financial pressure today.
How to Decide the Right Way to Fund Your Renovation
Before choosing how to pay for a renovation, homeowners should ask:
- Will this project improve my day-to-day life or long-term plans?
- Can I comfortably handle a higher monthly payment if I take on debt?
- Do I want to keep my existing mortgage rate intact?
- Am I prioritizing short-term cash flow or minimizing long-term cost, at any cost?
There’s no single “best” option. The right choice depends on timing, goals, and financial flexibility.
Bottom Line
In 2026, homeowners are certainly still renovating. But they’re also thinking far more carefully about how they pay for it. With refinancing less appealing, many are exploring flexible alternatives that allow them to improve their homes without increasing monthly financial stress.
Understanding your options — and the trade-offs that come with each — is the key to funding renovations in a way that supports both your home and your broader financial goals.
FAQ: Renovating Your Home in 2026
Are home renovations still worth it in 2026?
For most homeowners, absolutely — especially when renovations improve livability, efficiency, or help avoid the cost of moving.
Is refinancing a good way to pay for renovations right now?
It depends. With rates still elevated, refinancing may increase monthly payments for homeowners with low existing rates.
What are alternatives to refinancing for renovation funding?
Options include savings, home equity loans, HELOCs, and equity sharing agreements — each with unique benefits and considerations.
Can I renovate without taking on more debt?
Yes. Some homeowners use equity-based options that don’t involve monthly payments, though these typically involve sharing future home value.
How do I know if an equity-based option makes sense?
It often comes down to weighing the benefits of improved monthly cash flow against the potential long-term cost of sharing in your home’s appreciation. Equity sharing may not be the cheapest option in the long run, but it can give homeowners precious breathing room and flexibility in the short term, which is certainly valuable.
Disclaimer: This sponsored content is for informational purposes only and is not financial, legal, or tax advice. Unison’s Equity Sharing Agreement (ESA), offered through Unison Agreement Corp., provides cash upfront with no monthly payments or interest charges. In exchange, you share a percentage of your home’s future appreciation (or a limited portion of any depreciation) when the agreement ends (upon sale, refinance, buyout after 5 years, 30-year term, or death/default). If your home depreciates, Unison typically shares in a portion of the loss, subject to program limits—you may still owe the full advance amount. A lien is placed on your property, which may limit future refinancing options. There may be tax implications (e.g., potential recognition of income on forgiveness of advance if the home depreciates). No guarantees are made regarding home value changes or outcomes. For complete terms, eligibility, and details, visit unison.com. For traditional lending products, see Unison Mortgage Corp., NMLS #2574289. Always consult your own financial, legal, and tax professionals before proceeding.