The latest research analyzing remodelers’ outlook on the industry found a stable positive perception of both the current and future market nationally with slight confidence changes from region to region.
The National Association of Home Builders (NAHB)/Westlake Royal Remodeling Market Index recorded an unchanged rate of positivity from remodelers of 86 overall for the first quarter of 2022. The index measures from zero to 100, with positive measurements at 50 or higher.
One year ago, the index also reached 86. Results align with NAHB’s previous predictions of moderate growth in 2022, but the association says that growth is challenged by rising interest rates and the high cost of building materials.
While the overall index for the industry is 86, NAHB also surveys remodelers on current and future conditions. Current conditions are measured by averaging the results of three types of projects: large, medium, and small, priced at $50,000 or higher, $20,000 to $49,999, and below $20,000, respectively.
Current conditions were slightly higher than overall sentiment, measuring at 89. That measurement aligns with the previous quarter’s findings. Individually, all project types were close. Small projects had the highest confidence with a score of 90 while medium and large projects both came in at 89.
Future conditions are measured by the rate of leads and inquiries, in addition to current backlogs. This index measured the lowest, though still highly positive. Overall, remodelers’ sentiment on future conditions measured at 82 for the first quarter of 2022. This is two points less than one year ago but up five points from the fourth quarter of 2022.
The current rate of leads and inquiries was the measurement holding the measurement down with a score of 80. That’s a six-point year-over-year drop. On the other hand, backlogs increased by two points to 84.
The region leading in confidence for overall confidence is the west, hitting a 90 while the northeast trailed behind at 79. The south hit a positive number of 87 while the midwest measured 84.
The same trend remains for current and future market conditions, with the west leading in all areas.
Compared to 2022 metro remodeling predictions from the Joint Center for Housing Studies at Harvard University (JCHS), the west also led in the highest projected change in home improvement projection spending, again followed by the south, midwest, and northeast.
The JCHS survey found the states with the most metros poised for spiking home improvement spending for this year are California and Texas.