The National Association of Home Builders (NAHB) released the second quarter NAHB/Westlake Royal Remodeling Market Index (RMI) showing a reading of 59, marking a four point drop over the previous quarter. The industry is currently facing a slowdown due to economic uncertainty from government policies and high interest rates.

 

While the reading is still positive, it is the first time since the survey was revised in 2020 that it is under 60. Further, the Current Conditions Index is the average of the current market for large remodeling, moderately sized projects, and small projects readings while the Future Indicators Index is made up of the current rate at which leads and inquiries are coming in and the backlog of projects. Any number over 50 shows a positive standing. This quarter, the Current Conditions Index marked a reading of 66 - a five-point drop - while the Future Indicator Index averaged 51 - a four-point dip.

"Although remodeler sentiment softened in the second quarter, overall, it remains positive," said NAHB Chief Economist Robert Dietz. "High interest rates and economic uncertainty are headwinds for remodeling, but not to the extent that they have been for single-family construction. Even with these headwinds, NAHB is projecting that remodeling will post solid gains in 2025, followed by more modest but still positive growth in 2026."

According to the Global Market Insights, the increased rate of remodeling can be attributed to the growth in homeownership and the deterioration of older homes. The market is projected to grow between 2025 and 2034 3.8%.