The nation’s home and rental property owners continued to upgrade their properties at a healthy clip in this year’s second quarter, according to the National Association of Home Builders’ Remodeling Market Index (RMI).
NAHB’s RMI is made up of two related indices, one that measures current market conditions and another that measures future market expectations. The RMI for current conditions in the remodeling market held steadfast at 52.7 for a second consecutive quarter in the period from April 2002 to June 2002. This level represents a seven-point recovery from a slowdown that occurred in residential remodeling last fall.
“Continuing gains in home values and low interest rates are two strong incentives encouraging many homeowners to remodel,” said Bill Owens, a remodeler from Columbus, Ohio, and chairman of NAHB’s Remodelers Council.
The RMI for current conditions is based on responses from remodelers to questions regarding demand for major additions and alterations ($25,000 or more), for minor additions and alterations (less than $25,000) and for maintenance and repairs. These market components received scores of 49.4, 53.4 and 55.1, respectively, virtually unchanged from the first quarter. Any index over 50 indicates that more remodelers view market conditions as more favorable than unfavorable.
In spite of the market’s stability year-to-date, remodelers have tempered their expectations for business prospects in coming months. The RMI index gauging future market expectations fell by just over two points to 52.2 in the second quarter, with remodelers in the South and West revising their expectations downward from the first quarter by the most significant margins.