Lowe’s CEO says this is the ‘most difficult housing market’ since the financial crisis

Lowe’s (LOW) reaffirmed its 2026 outlook on Wednesday as do-it-yourself shoppers pulled back on big purchases but still showed appetite for smaller projects amid the most challenging environment for housing in years.

“This has been the most difficult housing market that I have faced in this business since the financial crisis,” Lowe’s CEO Marvin Ellison said on the company’s earnings call.

Ellison told Yahoo Finance that the “lock-in” effect, or homeowners’ reluctance to give up lower mortgage rates in today’s higher-rate environment, is leading to the lowest housing turnover in years. High mortgage rates are also making consumers hesitate to buy a home, with the 30-year fixed mortgage rate sitting well above 6% for weeks.

“Our consumer is a healthy consumer,” Ellison said. “They’re a homeowner, obviously. They have equity, they’ve been getting wage increases, they have good stability in their employment, but they feel uncertain because of the current mortgage rate environment.”

Read more: Is now a good time to buy a house?

Ellison said necessary replacements for appliances and water heaters led customer purchases. He also noted that customers are taking on more “economical” projects, such as painting, yard work, replacing wiring, and patching holes in roofs.

Home Depot (HD) CFO Richard McPhail echoed that sentiment on Tuesday, saying that “customers continue to defer those larger projects as a result of the concerns they feel over economic uncertainty and general affordability.”

Despite the tough housing backdrop, which disproportionately affects DIY customers, Lowe’s has “been able to deliver four consecutive quarters of positive comps with a DIY customer that represents roughly 60% to 65% of our revenue,” Ellison told Yahoo Finance over the phone.

In the first quarter, same-store sales grew 0.6%, boosted by online sales, strength in appliances, home services, and Lowe’s pro business. However, comparable sales growth was just below the 0.7% increase Wall Street analysts were expecting.

Lowe’s stock edged higher after the home improvement retailer reaffirmed its cautious 2026 outlook. The home improvement retailer expects same-store sales growth to be flat to up 2% year over year in 2026, below the 2% growth the Street was looking for, according to Bloomberg consensus data.

Ellison said the “business is performing well” in the early innings of the second quarter as the weather improves ahead of high-volume selling events such as Memorial Day, Father’s Day, and the Fourth of July.

He also said the company is ready to perform in any environment, but it’s watching for a turning point in the housing market.