Remodeling activity slows in the second quarter

The national remodeling market slipped in the second quarter under pressure from a sluggish economy although activity in the West region climbed modestly, according to the National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI).

“While the RMI indicates that the home remodeling market softened somewhat in the second quarter, this is still the second highest RMI we’ve been able to report since the third quarter of 2007,” said David Crowe, NAHB’s chief economist. “There are several barriers blocking the way to a stronger recovery. Homeowners who may want to remodel still face stringent lending requirements, and uncertainty about the economy is making them hesitant to undertake major improvements.”

The RMI dipped during the second quarter to 43.9 from the first quarter result of 46.5. An RMI below 50 indicates that more remodelers report market activity is lower compared to the prior quarter than report it is higher.

“Remodelers have experienced the same hiccup that has rippled through the U.S. economy,” said Bob Peterson, NAHB remodelers chairman. “After picking up the pace early in the year, the calls from customers dropped off and remodeling slowed down.”

Regionally, current market conditions shrank in two areas: the Midwest to 44.4 (from 47.1 in the first quarter) and the South to 42.9 (from 46.1). The West at 48.2 (from 46.1) and Northeast at 48.1 (from 46.1) showed improvement.