US Remodeler Sentiment Trends Higher in Q4

On Thursday, the National Association of Home Builders (NAHB) and Westlake Royal jointly released their Remodeling Market Index (RMI) for Q4. The RMI posted a reading of 68, a 5-point gain from the previous quarter.

Remodelers are showing increased optimism about the market compared to earlier in the year, according to the RMI, a trend supported by NAHB’s analysis of home improvement loan applications.

Demand for remodeling, particularly for larger projects, was stronger than usual in many areas this fall, with leads picking up after uncertainty surrounding the November elections subsided. The current conditions index for projects exceeding $50,000 saw the largest quarterly increase, and the share of remodelers engaged in whole-house remodeling reached a record high of 62%.

The RMI is an average of two component indices: the Current Conditions Index and the Future Indicators Index.

1. All three components of the Current Conditions Index remained well above 50 in positive territory: Large remodeling projects rose 8 points to a reading of 75, moderate remodeling projects increased 2 points to 73, and small remodeling projects inched down 1 point to 76.
2. The Future Indicators Index was 61, up 6 points from the previous quarter. The component measuring the current rate at which leads and inquiries are coming jumped 9 points to 62. Meanwhile, the component measuring in the backlog of remodeling jobs rose 2 points to 59.