The National Association of Home Builders released its NAHB/Westlake Royal Remodeling Market Index for the third quarter of 2024, posting a reading of 63, down two points compared to the previous quarter.
The Current Conditions Index averaged 72, declining one point compared to the previous quarter. All three components remained well above 50 in positive territory: the component measuring large remodeling projects ($50,000 or more) fell three points to 67, the component measuring moderate remodeling projects (at least $20,000 but less than $50,000) dropped three points to 71, and the component measuring small-sized remodeling projects (under $20,000) rose two points to 77.
The Future Indicators Index averaged 55, down three points compared to the previous quarter. The component measuring the current rate at which leads and inquiries are coming in dropped two points to 53, and the component measuring the backlog of remodeling jobs fell three points to 57.
About the Remodeling Market Index
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.
NAHB's take on the data
“Although the overall RMI edged down for the third consecutive quarter, most remodelers remain optimistic about the market,” says NAHB Remodelers Chair Mike Pressgrove. “However, some have potential customers who are citing the upcoming election as a reason for putting larger projects on hold.”
“An RMI of 63 is consistent with NAHB’s forecast for steady 2% growth in remodeling spending over the next two years, but remodelers are facing various headwinds,” says NAHB Chief Economist Robert Dietz. “In addition to possible uncertainty associated with the election, it remains difficult to find skilled construction labor, and interest rates have become a double-edged sword. Although rates have come down, they remain higher than they were several years ago, and some home owners are waiting to see if they come down further before moving ahead with substantial remodeling projects.”
