NAHB

Remodeling Market Sentiment Showed Improvement in Q4

Remodelers expressed more optimism at the end of 2024 than they did earlier in the year, according to the NAHB/Westlake Royal RMI survey.
Jan. 21, 2025
3 min read

The National Association of Home Builders released its fourth quarter NAHB/Westlake Royal Remodeling Market Index (RMI), which posted a reading of 68, up five points from the previous quarter.

“Remodelers are more optimistic about the market than they were earlier in the year,” said NAHB Remodelers Chair Mike Pressgrove. “Demand in many parts of the country was stronger than usual for the fall season, especially demand for larger projects, with leads coming in after the uncertainty about the November elections was removed.”

The NAHB/Westlake Royal RMI survey asks remodelers to rate five com-ponents of the remodeling market as “good,” “fair” or “poor.” Each ques-tion 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 increase in the 4th quarter RMI was driven to a great degree by de-mand for large projects,” said NAHB Chief Economist Robert Dietz. “Not only did the current conditions index for $50,000-plus projects show the greatest increase during the quarter, but the share of remodelers doing whole house remodeling reached a record high of 62%. This has signifi-cant implications for supply chains because large remodeling projects are more likely to use building products purchased directly from the manufacturer, or a manufacturer’s distribution center, rather than a retail outlet.”

Current Conditions Index

The Current Conditions Index averaged 75, up three points from the previ-ous quarter. All three components remained well above 50 in positive terri-tory. The component measuring large remodeling projects ($50,000 or more) rose eight points to 75, the component measuring moderate re-modeling projects (at least $20,000 but less than $50,000) increased two points to 73, and the component measuring small-sized remodeling pro-jects (under $20,000) inched down one point to 76.

The Current Conditions Index is an average of three components: the cur-rent market for large remodeling projects, moderately sized projects, and small projects.

Future Indicators Index

The Future Indicators Index averaged 61, up six points from the previous quarter. The component measuring the current rate at which leads and inquiries are coming in jumped nine points to 62, and the component measuring the backlog of remodeling jobs rose two points to 59.

The Future Indicators Index is an average of two components: the current rate at which leads and inquiries are coming in and the current backlog of remodeling projects.

The overall RMI is calculated by averaging the Current Conditions Index and the Future Indicators Index. Any number over 50 indicates that more remodelers view remodeling market conditions as good than poor.

About the Author

Jay Schneider

Senior Editor

Jay Schneider is the Senior Editor for Pro Remodeler. He can be reached at [email protected].

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