Repair, Retain, Repeat: HVAC’s New Reality

Not that long ago, running a successful HVAC contracting business was largely about keeping trucks busy, answering the phone, and delivering quality work. Today, contractors are navigating a very different landscape — rising equipment costs, shifting consumer expectations, labor shortages, rapid technology adoption, and an increasingly competitive marketplace.

In a market shaped by these factors, contractors can no longer rely on instinct alone. The numbers reveal where the industry is heading, how peers are responding, and which operational strategies are driving profitability. Data helps HVAC business owners make smarter decisions about hiring, pricing, marketing, technology investments, and long-term growth planning.

Fortunately, data is prevalent today if you know where to look. Many industry organizations and software providers have recently released surveys and benchmarking reports.

According to EGIA’s 2026 Contractor Survey, 39% of HVAC leaders are optimistic about the future of the industry, citing technology innovation and green opportunities. Meanwhile, 56% of respondents were neutral, most likely due to regulatory, supply chain, and labor shortages. These numbers shifted significantly in the direction of “neutral” or uncertain about the future when compared to the 2025 Survey, EGIA reports.

The survey also notes that labor shortages, overall costs of goods and services, government regulations, and private equity continue to rank as the top threats for most of the industry. Per EGIA, larger companies see private equity as a bigger threat than government regulations. Additional threats included DIY solutions, discontinued tax credits/incentives, supply chain/equipment availability, online conglomerates, interest rates, and AI.

Shifting focus to ServiceTitan’s 2026 Residential State of the Trades Report, contractor strategy is shifting toward scaling smarter — prioritizing existing customers over chasing volume. The report notes that 32% of contractors expect revenue growth compared to 33% in 2025. However, 53% of contractors are prioritizing existing customers over new ones, while 31% are focusing on customer acquisition. Rounding out the top five business goals for the year were grow revenue (66%), improve cash flow (35%), and modernize/digitize experience (27%).

I recently sat down with Angie Snow, principal industry advisor at ServiceTitan, during an episode of our podcast, “HVAC Chats,” to discuss some of the report’s findings. Here’s what she had to say:

“In the past, if we wanted to grow, we just needed to hire more technicians, spend more on marketing, or maybe raise prices in the price book, and that would help increase volume. What we’ve seen now is a shift because there’s a different consumer. The modern homeowner is expecting different things.

“Customers want speed, convenience, and transparency,” Snow continues. “They want it to be easy, and they want to know what’s going on. Companies need to adjust their priorities to meet the needs of these modern homeowners who are buying in a different way. We’ve seen a lot of success in the trades regardless, but contractors need to think about how they can change operations to be more effective and execute at a higher level to meet those customer expectations.”

While contractor survey data offers a valuable ground-level view of the challenges and opportunities shaping the industry, it’s only part of the story. To gain a broader perspective on where the HVAC market is headed next, we turned to a panel of manufacturers for our June cover story, the Mid-Year HVAC Market Review. In this annual outlook, industry experts share their insights on demand trends, pricing pressures, and the economic factors expected to influence the residential and commercial HVAC markets through the remainder of 2026.

“We continue to see consumers prioritize repairing their existing systems rather than replacing when possible,” notes Randy Roberts, senior vice president, Wholesale at Rheem North America. “We are seeing increased parts sales, which reinforces this trend. However, over the last month, there has been some strengthening in the residential space, driven by partnerships with contractors and plumbers to lower financing costs and give consumers options when their HVAC or water heaters need to be replaced.”  

The repair vs. replace shift is leading homeowners to seek out contractors with the skills and expertise to accurately diagnose system issues and keep systems running as long as possible.

Lenny Diaddario, manager of contractor relations, Copeland notes that younger homeowners are looking to trim costs and attempting a do-it-yourself (DIY) approach to their HVAC systems. This has led to more online purchases of HVAC products than ever before, bypassing traditional purchasing channels.

“In some instances, homeowners attempt to install the systems themselves, but often call on contractors to finish the installation. So, contractors need to be prepared to deal with this emerging business and service dynamic,” he says.

Flip to page 12 to learn more from our panel of industry experts on what to expect for the remainder of 2026.

The rules of HVAC business are changing, and contractors need to adapt, innovate, and think strategically in order to succeed in the years ahead.