The Remodeling Market Index (RMI) rose one point to 58 in the second quarter of 2018, according to the National Association of Home Builders (NAHB). A RMI reading above 50 indicates that more remodelers report market activity is higher than report it is lower compared to the prior quarter. The RMI has been above 50 for 21 consecutive quarters (Figure 1).
The RMI is a composite measure of current market conditions and future market indicators. In the second quarter, current market conditions decreased one point to 57. Among its three major components, major additions and alterations waned one point to 55, minor additions and alterations decreased two points to 58, and the home maintenance and repair component rose two points to 59.
Meanwhile, future market indicators gained four points to 59 in the second quarter. Among its components, calls for bids fell two points to 55, amount of work committed for the next three months increased two points to 56, the backlog of remodeling jobs jumped nine points to 66 and appointments for proposals rose seven points to 61.
The increase in this quarter’s RMI reflects a strong remodeling industry supported by continued economic growth. While the market is strong, remodelers are still facing supply-side challenges such as rising material costs and labor shortages.