Is Your Contracting Business Experiencing a leads slowdown?
Over the past few weeks, I’ve been hearing the same thing from a range of clients. A landscaper told me their phone isn’t ringing nearly as much as it was this time last year. An arbor care company noticed estimate requests dropping off, even though they usually pick up toward fall. A design/build firm had a handful of projects stall mid-discussion as homeowners hesitated to sign contracts. And one home improvement contractor put it bluntly: “We’re busier chasing work than closing it.”
It’s not just them. Across the trades, contractors are feeling a slowdown in leads and inquiries—and the reasons behind it are layered.
The Cost of Borrowing
Interest rates may not be at their peak, but they’re still high enough to make homeowners think twice about big-ticket projects. As of August, the average 30-year mortgage rate sat around 6.58%, the lowest in nearly a year but still well above what many buyers can stomach (Reuters, Aug 18, 2025). The National Association of Home Builders sentiment index dropped to 32, its weakest level since 2022—evidence that builders nationwide are seeing buyers pull back. When people aren’t moving, they’re not remodeling kitchens, adding decks, or investing in landscape design at the same pace.
The Material Squeeze
At the same time, tariffs on steel, aluminum, copper, and lumber are pushing up the cost of building. The Houston Chronicle estimates that new tariffs could add $8,300 to $12,500 to the cost of an average home (Houston Chronicle, July 2025). For a homeowner already hesitant to spend, that bump can be enough to stall the decision. Even industry giants are struggling—Caterpillar and Deere have flagged billions in added costs, noting that demand is too soft to simply pass those increases onto customers (Reuters, Aug 15, 2025).
Waiting for Certainty
Beyond costs, there’s a cloud of hesitation hanging over the market. With tariffs still unsettled, supply chains shaky, and shifting immigration policies threatening to tighten an already strained labor pool, both homeowners and developers are leaning toward “wait and see.” Projects are lingering in planning stages longer, and fewer are breaking ground quickly (ENR, July 2025).
What It Means in the Field
When you pull it all together, it’s not surprising that leads are slowing down. Homeowners are cautious, costs are unpredictable, and the sense of uncertainty is stronger than the urge to dive into a project. For contractors, this means more competition for fewer inquiries, tighter margins, and a need to stand out in how they operate—not just in what they build.
This is where systems, processes, and Lean thinking make the difference. When the market tightens, the businesses that thrive are the ones with clear standard work, streamlined communication, and reliable processes that deliver projects on time and on budget. My work with contractors focuses on exactly that – helping you cut waste, strengthen your teams, and build a business that’s resilient no matter what the economy throws at you.
Notice fewer calls or stalled projects, and wondering how to steady your business?
Let’s chat. I offer on-site coaching, team workshops, and Lean strategy support to help contractors build the systems and processes that keep work moving – even when the market slows.
Priscilla Hansen Mahoney
Business Coach for Contractors
Where Strategy Gets to Work