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Remodeling Market Stability a Positive Sign for Housing

by devteam October 24th, 2014 | Share

Builders who engage in home remodeling continue torndisplay confidence in their market the National Association of Home Buildersrn(NAHB) said today.  NAHB’s RemodelingrnMarket Index (RMI) rose from 56 in the second quarter of 2014 to 57 in thernthird quarter. </p

NAHB described the current index reading as a “highrnwater mark” and said it was the sixth consecutive quarter that the reading hasrnbeen above the benchmark of 50.  Thisrnindicates that more remodelers report a higher level of activity compared tornthe previous quarter than those who see activity as down.  </p

The RMI averages responses about current activityrnwith those about future expectations for work. rnBoth current and future responses are based on calls for bids, amount ofrnwork committed for the next three months, backlog of jobs, and appointments forrnproposals. </p

“Most remodelers remain confident that the market is improving as homernowners undertake renovations, large and small,” said NAHB Remodelers Chair PaulrnSullivan. “The consistency and longevity of positive RMI readings are in linernwith the gradual recovery of the housing industry.”</p

The RMI’s future market conditions index rose to 58 from 56 in the previousrnquarter. All measures – bids, commitments, backlogs, and appointments – remainedrnlevel with the previous quarter’s reading. rn</p

The component measuring current activity increased one point but therncategories of both large additions and smaller remodeling jobs each rose 2rnpoints, to 56 and 58 respectively.</p

 “The stabilization of the RMI in thernmid-50s for more than a year demonstrates the slow, steady recovery of thernhousing industry that we expect to continue,” said NAHB Chief Economist DavidrnCrowe. “The major headwind to a stronger recovery is a shortage of qualifiedrnlabor and subcontractors in some parts of the county, making it difficult forrnremodelers to employ carpenters and finish projects as quickly and economicallyrnas many of their customers expect.”

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About the Author

devteam

Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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