The Remodeling Market Index has reached its highest level since the fourth quarter of 2006, according to the National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI), released today.

The remodeling market is heading into recovery with an increase to 46.5 in the first quarter of 2011 from 41.5 in the fourth quarter of 2010, says the NAHB. An RMI below 50, however, indicates that still more remodelers report market activity is lower (compared to the prior quarter) than report it is higher.

The overall RMI combines ratings of current remodeling activity with indicators of future activity like calls for bids. Current market conditions for the first quarter of 2011 rose to 46.1 from 43.3 in the previous quarter. Future market indicators climbed to 46.8 from 39.7 in the previous quarter.

Regional break downs for current remodeling market conditions showed growth in all but one area: Northeast 46.1 (from 38.8 in the fourth quarter), South 46.1 (from 45.8), and West 46.1 (from 39.7). Only the Midwest experienced a decline to 47.1 (from 54.3).

“Home remodeling continues to slowly increase and continued growth through the year is expected,” said NAHB Chief Economist David Crowe. “The fact that some indicators are breaking 50 means remodelers are seeing improving activity in their markets. While credit scarcity and economic uncertainty continue to weigh down remodeling, signs of increasing consumer interest are promising.”