The
residential remodeling market will continue to experience measured growth in
2012 after the National Association of Home Builders’ Remodeling Market Index
rose to a five-year-high at the end of 2011, according to panelists at Feb. 9
press conference during the International Builders’ Show in Orlando, Fla. The
strongest sectors of the remodeling market at present are aging-in-place
retrofits, energy-efficiency upgrades, and reinvesting in distressed
properties. The leading indicator for remodeling points to continued market
volatility, but stronger growth in the second half of 2012.
“Spending
on improvements to owner-occupied housing is nearly equal to that of new
residential construction,” said
Paul Emrath, NAHB’s
vice president for survey and housing policy research. “NAHB predicts that
residential remodeling will rise 8.9 percent in 2012.”
While
overall housing market conditions continue to create a drag on remodeling
growth, the growing trend among home owners to remain in their homes and
remodel has provided a boost to the remodeling market.
“Remodelers
are poised to continue our industry’s gradual improvement as we start 2012,”
said 2012 NAHB Remodelers Chairman
George “Geep” Moore Jr.,
CGR, CAPS, GMR, a remodeler from Elm Grove, La. “It is our hope that home
owners who want to remodel this year face less constrictions from lack of
financing, fear of lost equity and challenging appraisals.”
In
the fourth quarter of 2011, the RMI component measuring current market
conditions rose to 48.4 from 43.0 in the previous quarter. The RMI component
measuring future indicators of remodeling business was also positive,
increasing to 44.8 from 40.4 in the previous quarter.
The
RMI is based on a quarterly survey of professional remodelers, whose answers to
a series of questions were assigned numerical values to calculate two separate
indices. The overall RMI averages ratings of current remodeling activity with
indicators of future activity. An RMI below 50 indicates that more remodelers
report market activity is lower (compared to the prior quarter) than report it
is higher.
Source: NAHB Links
