New residential HVAC equipment sales are facing a steep decline as homeowners confront sticker shock, tighter financing, and regulatory pressures that make full system replacements harder to justify. With new installs down sharply, repair and retrofit work is quickly becoming the backbone of contractor revenue, offering higher margins and steady demand. Contractors who pivot by empowering technicians with diagnostic tools, emphasizing valuable retrofit solutions, and adjusting their sales focus will be best positioned to thrive in this evolving market.