Remodeling Market Sentiment Dips

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Most remodelers continue to express positive sentiment, but some report slowing activity, the NAHB/Westlake Royal Remodeling Market Index found.

The index, published by the National Association of Home Builders, posting a reading of 59 for the second quarter, down four points from the previous quarter. While the reading of 59 remains in positive territory, this is only the second time the index has dipped below 60 since the survey was revised in early 2020.

The NAHB/Westlake Royal RMI survey asks remodelers to rate five components of the remodeling market as “good,” “fair” or “poor.” Each question is measured on a scale from 0 to 100, where an index number above 50 indicates that a higher share view conditions as good than poor. The results of the RMI are seasonally adjusted.

“Most remodelers continue to express positive sentiment, but some, especially in the western part of the country, are seeing a slowing of activity in their markets,” said NAHB Remodelers Chair Nicole Goolsby Morrison, a remodeler from Raleigh, N.C. “Those who report a slowdown have cited economic uncertainty stemming from government policies as the main reason.

NAHB Chief Economist Robert Dietz noted remodeler sentiment remains positive despite some softening. “High interest rates and economic uncertainty are headwinds for remodeling, but not to the extent that they have been for single-family construction,” he said, adding that NAHB projects that remodeling will post solid gains in 2025, followed by more modest but still positive growth next year.

The index’s measure of current conditions averaged 66, dropping five points compared to the previous quarter. All three components remained above 50 in positive territory: the component measuring large remodeling projects ($50,000 or more) slipped two points to 62, the component measuring moderate remodeling projects (at least $20,000 but less than $50,000) fell six points to 66, and the component measuring small-sized remodeling projects (under $20,000) dropped six points to 70.