Q3 Rehab Market Recap: Costs Materials and Labor Trends

The Q3 numbers are in. The third quarter of 2026 brought continued shifts in rehab costs, material availability, and labor markets. Here is what the data shows and what it means for your next project.

Q3 2026 Cost Trends

| Category | Q2 2026 | Q3 2026 | Change | |---|---|---|---| | Lumber (per MBF) | $410 | $385 | -6.1% | | Electrical materials | +8% YoY | +6% YoY | Moderating | | Plumbing fixtures | +5% YoY | +4% YoY | Stable | | Labor (skilled trades) | +7% YoY | +9% YoY | Accelerating | | Dumpster/hauling | +3% YoY | +4% YoY | Slight increase |

"Material costs are stabilizing, but labor costs are accelerating," says the LendlyX team. "Investors who budget based on last year's labor rates are going to be surprised."

Key Takeaways

Labor Is the New Constraint

Skilled trade labor remains the tightest input in rehab construction. Electricians, plumbers, and HVAC technicians are in high demand and commanding premium rates. Investors should budget 10–15% above 2025 labor rates.

Material Costs Are Normalizing

After two years of volatility, most material categories are returning to predictable pricing. Lumber has declined for two consecutive quarters. Electrical and plumbing materials are still above pre-pandemic levels but growing at a slower pace.

Project Timelines Continue to Extend

The average fix-and-flip project duration reached 6.4 months in Q3, up from 6.2 in Q2. Labor availability is the primary driver.

What This Means for Q4 Planning

• Budget for higher labor costs — do not use 2025 rates
• Lock in material pricing early where possible
• Build seven-month holding periods into financial models
• Use LendlyX to track actual costs against budget in real time

"The market rewards investors who plan for reality, not for optimism," the LendlyX team notes.

Ready to plan your Q4 projects? Sign up for LendlyX or book a demo.