Remodeling Market Sentiment Edged Down in Second Quarter

The National Association of Home Builders released its NAHB/Westlake Royal Remodeling Market Index for the second quarter, posting a reading of 68, edging down two points compared to the previous quarter.

The NAHB/Westlake Royal RMI survey asks remodelers to rate five components of the remodeling market as “good,” “fair” or “poor.” Each question is measured on a scale from 0 to 100, where an index number above 50 indicates that a higher share view conditions as good than poor.

The Current Conditions Index is an average of three components: the current market for large remodeling projects, moderately sized projects and small projects. The Future Indicators Index is an average of two components: the current rate at which leads and inquiries are coming in and the current backlog of remodeling projects. The overall RMI is calculated by averaging the Current Conditions Index and the Future Indicators Index. Any number over 50 indicates that more remodelers view remodeling market conditions as good than poor.

The Current Conditions Index averaged 77, increasing two points compared to the previous quarter. Two of the three components increased, as well: the component measuring large remodeling projects ($50,000 or more) inched up one point to 72 and the component measuring small remodeling projects (under $20,000) rose by four points to 81. Meanwhile, the component measuring moderately sized remodeling projects (at least $20,000 but less than $50,000) decreased by one point to 77.

The Future Indicators Index fell four points to 60 compared to the previous quarter. The component measuring the current rate at which leads and inquiries are coming in remained even at 59, and the component measuring the backlog of remodeling jobs dropped eight points to 61.

For more information, visit nahb.org/rmi.