Remodelers’ Confidence Increased in Fourth Quarter 2019

January 22nd, 2020 by Editor

The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 58 in the fourth quarter of 2019, up three points from the previous quarter. The RMI has been consistently above 50 since the second quarter of 2013, indicating that more remodelers report market activity is higher compared to the prior quarter than report it is lower. The overall RMI averages current remodeling activity and future indicators.

“The low inventory of homes on the market is forcing people to stay in their homes, thus increasing the desire and demand to remodel,” said NAHB remodelers chair Tim Ellis, a remodeler from Bel Air, Md.

Current market conditions increased two points on the index (to 56) from the previous quarter. Among its three major components, major additions and alterations gained four points (56), minor additions and alterations increased by one point (54) and the home maintenance and repair component rose one point (58).

Future market indicators gained three points (60) from the previous quarter. Calls for bids increased by three (58), amount of work committed for the next three months gained three points (57), the backlog of remodeling jobs jumped five points (64) and appointments for proposals increased by two points (62).

“The jump in the backlog of remodeling jobs is unsurprising due to several factors,” said NAHB chief economist Robert Dietz. “Demand for remodeling is high, supported by a strong overall economy and low-interest rates, and it is challenging to meet the demand and work off a backlog quickly due to the ongoing shortage of skilled labor.”

Beginning with the first quarter of 2020, the RMI will be redesigned and a new series will be released, NAHB officials said.

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