The NAHB/Westlake Royal Remodeling Market Index (RMI) posted a reading of 68 for the fourth quarter of 2024, up five points compared to the previous quarter.
Remodelers are more optimistic about the market than they were earlier in the year, corroborated by NAHB’s recent analysis of home improvement loan applications. 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. 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%.
The RMI is based on a survey that asks remodelers to rate various aspects of the residential remodeling market “good”, “fair” or “poor.” Responses from each question are converted to an index that lies on a scale from 0 to 100. An index number above 50 indicates a higher proportion of respondents view conditions as good rather than poor.
Current Conditions
The Remodeling Market Index (RMI) is an average of two major component indices: the Current Conditions Index and the Future Indicators Index.
The Current Conditions Index is an average of three subcomponents: the current market for large remodeling projects ($50,000 or more), moderately sized projects ($20,000 to $49,999), and small projects (under $20,000). In the fourth quarter of 2024, the Current Conditions Index averaged 75, increasing three points from the previous quarter. All three components remained well above 50 in positive territory: large remodeling projects rose eight points to 75, moderate remodeling projects increased two points to 73, and small remodeling projects inched down one point to 76.
Future Indicators
The Future Indicators Index is an average of two subcomponents: the current rate at which leads and inquiries are coming in and the current backlog of remodeling projects.
In the fourth quarter of 2024, the Future Indicators Index was 61, up six points from the previous quarter. The component measuring the current rate at which leads and inquiries are coming jumped nine points to 62. Meanwhile, the component measuring in the backlog of remodeling jobs rose two points to 59 quarter-over-quarter.
For the full set of RMI tables, including regional indices and a complete history for each RMI component, please visit NAHB’s RMI web page.
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