Remodeling Market Outlook Declines Slightly in Q2

The National Association of Home Builders (NAHB) and Westlake Royal jointly released Thursday (7-13-23) their Remodeling Market Index report for 2023Q2. According to the RMI, remodelers’ sentiment in their marketplace edged slightly lower in Q2, down 2 points from Q1 to a reading of 68. However, even after the modest decrease, the RMI remains in positive territory and consistent with the NAHB’s forecast that the remodeling sector will grow in 2023, albeit at a slower pace than in 2022.

Demand for remodeling services continues to hold steady despite higher borrowing costs and pricing for projects. According to the RMI, the remodeling market is enjoying multiple tailwinds which are supporting demand, including low inventory, especially of existing homes, aging housing stock, increased opportunities for employees to work-from-home, and high levels of equity for existing homeownership.

The RMI is an average of two major component indices: the Current Conditions Index and the Futures Indicator Index. In Q2, the Current Conditions component index was at a reading of 77, increasing 2 points from Q1. However, the Future Indicator Index declined 4 points from Q1 to a reading of 60.