The building materials and home furnishing industry in 2026 is undergoing a profound “expectation revision.”
In the first half of the year, the area of newly started construction in the real estate market continued to bottom out, and the demand for new home renovations further shrank. The traditional growth logic of relying on the delivery of rough houses was unsustainable.
But at the same time, an overlooked data is quietly emerging: the renovation rate of existing housing in key cities has exceeded 35%, and the remodeling cycle after the transaction of second-hand housing has been shortened to an average of 8 months.
This means that the underlying demand structure of the industry is undergoing an irreversible shift – from “incremental driven” to “stock driven”.
In the first half, most companies felt “difficult”: price wars intensified in the low-end market, dealers continued to close stores, and the passenger flow density of traditional stores dropped to a ten-year low.
But the phenomenon at the other extreme is also worthy of attention: the revenue of the complete channel of leading customized home furnishing companies increased by more than 40% year-on-year, the penetration rate of smart toilets and smart sleep systems exceeded 25%, and the export volume of building materials in cross-border e-commerce channels maintained double-digit growth.
The “K-shaped differentiation” of the industry has never been so dramatic.
Entering the second half, the building materials and home furnishing industry will not usher in a V-shaped reversal, but structural opportunities are accelerating.
The following six major trends will define the competitive landscape in the second half of 2026.
1. Stock renovation has become the absolute main battlefield
If 2025 is the “first year of old renovation”, then the second half of 2026 will be the turning point for the large-scale release of stock demand.
As communities where commercial housing was delivered intensively around 2000 enter a 20-25-year renovation cycle, the demand for partial kitchen and bathroom renovations, whole-house renovations, and aging-friendly renovations is booming.
In the second half of the year, this trend will show three characteristics:
- From “major demolition and major renovation” to “minor renovation and quick installation”: consumers no longer pursue one-time whole-house decoration, but prefer modular services such as “kitchen refresh” and “bathroom 72-hour renovation”.
This places higher demands on enterprises’ supply chain response speed and standardized delivery capabilities. - Aging-friendly transformation has shifted from policy-driven to market-driven: the population born in the 1960s has entered the peak period of retirement, and anti-slip floor tiles, barrier-free shower systems, and smart security building materials will be upgraded from “niche categories” to “traffic entrances.”
- The unit price logic of the existing market has changed: the “face-saving project” of new home decoration has given way to functional upgrades, and consumers are more willing to pay for hidden projects (water, electricity, waterproofing, sound insulation) and long-term use experience.
Enterprise response: Whoever can establish a “product system exclusive for existing housing + delivery standards for partial renovation + service team for renovation of old houses” will be able to seize the opportunity in the second half of the year.
2. AI and spatial intelligence enter the “sensorless integration” stage
In 2026, smart homes are bidding farewell to the era of stacking “single product intelligence” and entering the system integration stage of “spatial intelligence”.
In the first half of the year, the application of large AI models in home scenes was still limited to voice control and simple linkage.
In the second half of the year, as the cost of end-side AI chips decreases and the Matter protocol becomes more popular, the industry will see a qualitative leap:
- Active intelligence replaces passive response: the system no longer waits for user instructions, but automatically adjusts through environmental sensing – the bathroom floor heating is preheated in advance according to the user’s schedule, the kitchen water purification system automatically backwashes according to the water quality TDS value, and the wardrobe automatically turns on dehumidification according to the humidity.
- Building materials themselves become interactive interfaces: “Building materials as terminal” products such as smart glass, temperature-controlled paint, and luminous stone will move from concept to mass production. Walls are no longer just decorative surfaces, but media for information display and environmental adjustment.
- AI on the design side: Space design tools based on AIGC can already generate practical construction drawings and bills of materials. In the second half of the year, more companies will connect them to terminal stores to realize a closed loop of “AI design-instant quotation-factory direct supply”.
Business response: Building materials companies must think beyond “material suppliers” and establish in-depth ecological cooperation with intelligent system manufacturers, or independently develop integrated solutions of “building materials + sensors + algorithms”.
3. Complete installation and full-case design become “infrastructure”
In the second half of 2026, “complete installation” will no longer be a differentiated selling point, but a threshold for entry.
Consumers’ patience with the decoration process is running out, and they are no longer willing to rush back and forth between building materials markets, furniture stores, and soft furnishing studios.
The pressure of this demand has further accelerated industry integration:
- Customized home furnishing companies reversely integrate building materials: leading customization brands have begun to build or acquire supply chains for ceramic tiles, wooden doors, and soft furnishings, and lock in unit prices with “whole home delivery.”
- The voice of the decoration company channel has reached its peak: in the second half of the year, the centralized procurement scale of the TOP50 decoration companies will account for more than 30% of the shipments of some building materials categories (such as waterproofing, pipes, and hardware).
Whether it can enter the supply chain of decoration companies determines the life and death of the company. - Revaluation of designer channels: In the high-end market, independent designers and designer studios have become the entrance to traffic. Building materials brands need to shift from “selling materials” to “selling solutions” and provide designers with full-link support from inspiration library to delivery.
Enterprise response: Either become a high-quality supplier of the integrated platform (strengthening cost-effectiveness and delivery stability), or establish its own assembly capabilities (strengthening brand premium and service experience), and the “half-baked” companies in the middle will be accelerated to clear out.
4. Going overseas and entering the “Brand 2.0” era
In the first half of 2026, China’s building materials and home furnishing exports will face the dual squeeze of weak demand in Europe and the United States and the rise of local production capacity in Southeast Asia.
But in the second half of the year, the logic of going overseas is being upgraded from “relocating production capacity overseas” to “going overseas with brands”:
- Category upgrades in cross-border e-commerce: Chinese sellers on Temu and TikTok Shop no longer only sell cheap lamps and storage boxes, but high-priced categories such as smart door locks, lift tables, and modular sofas have begun to increase in volume.
- High-end opportunities in emerging markets: There is strong demand for mid-to-high-end building materials in the Middle East, Central Asia, Latin America and other markets. Chinese brands are squeezing the market share of traditional European and American brands with their design iteration speed and intelligent configuration.
- In-depth binding of localized operations: In the second half of the year, more companies will adopt the asset-heavy model of “overseas warehouses + local service teams” instead of simply trading overseas.
Especially in the field of customized home furnishings, the localized closed loop of “measurement-design-installation” is the key to establishing barriers.
Enterprise response: abandon the “low-price exchange” thinking, establish brand recognition and service networks in target markets, and build a moat with “China’s supply chain efficiency + localized user experience”.
5. Green and low carbon changes from “cost item” to “competitiveness”
In the second half of 2026, ESG will no longer be a public relations rhetoric for listed companies, but a real cost structure and product definition right.
With the expansion of the EU Carbon Border Adjustment Mechanism (CBAM) and the implementation of green building materials procurement policies in the domestic market, the industry will face:
- Carbon footprints have become trade barriers: ceramics, aluminum materials, and furniture exported to Europe will face carbon cost accounting, and the export profits of high-energy-consuming companies will be significantly eroded.
- Green building materials certification has become a bidding threshold: government projects, state-owned enterprise collective procurement, and large-scale commercial space projects generally require green product certification, and companies without certification are directly excluded.
- The green premium on the consumer side appears: the younger generation of consumers are willing to pay a 5% – 10% premium for “zero formaldehyde”, “recyclable” and “low-carbon production”, and green attributes are beginning to be transformed into brand assets.
Corporate response: Transform low-carbon from “passive compliance” to “active investment” – photovoltaic roofs reduce production energy consumption, biomass materials replace traditional substrates, and water-based coating process upgrades. These investments will see returns in the second half of the year.
6. Channel fragmentation and traffic reconstruction
In the second half of 2026, the channel landscape of the building materials and home furnishing industry will show the characteristics of “no mainstream channels, only fragmented traffic”:
- The “showroom-style” transformation of traditional stores: Red Star Macalline, Easyhome and other stores will further reduce their pure rental area and shift to a composite format of “live broadcast base + designer salon + brand flagship experience center”.
- Content platforms have become new shelves: Xiaohongshu and Douyin are not only brand exposure channels, but also direct transaction entrances.
In the second half of the year, “scenario-based delivery” based on short videos and live broadcasts will account for more than 20% of sales in some categories (such as soft furnishings, small home appliances, and decorative building materials). - The density war of community stores: In mature communities where existing housing stock is concentrated, “community service stations” (which have the functions of display, warehousing, and after-sales) have become the shortest path to reach consumers.
Whoever can establish service outlets within a radius of 500 meters can intercept the demand for old modifications.
Enterprise response: Establish “global operation” capabilities – online content cultivation and precise customer acquisition, offline experience transformation and service delivery, and use digital tools to open up fragmented traffic.
Conclusion: In the era of inventory, doing “time business”
In the second half of the building materials and home furnishing industry in 2026, there will be no grand narrative, only micro competition.
The total industry volume may no longer grow, but structural opportunities have never disappeared: the certainty of stock renovation, room for intelligent upgrades, integration dividends from complete equipment, incremental markets for overseas expansion, and policy windows for green transformation—these opportunities will not be shared equally, but will only favor those companies that have completed “internal strength cultivation.”
The key word in the second half is not “expansion” but “deep cultivation”; not “scale” but “efficiency”; not “traffic” but “retention”.
When the tide recedes, companies that can truly build user trust, deliver certainty and brand premium in the existing market will become the winners of the new cycle.
After all, building materials and home furnishings are never a one-time deal, but a business that lasts “ten years after you live in it”.
