Remodeling activity increased during the third quarter of 2006, according to the latest release of the Remodeling Market Index (RMI). However, the current conditions portion of the index jumped more than two points (to 47.8), but still remains well below 50, which is the watermark for what is considered “positive.” And although the future expectations portion of the index increased, it also lies below 50 — and even lags more than two points behind the current conditions number.
Much of the good news comes regionally. The current conditions index in the West had dropped below 50 for the first time in nearly four years, but bounced back to 51.4 — with optimistic expectations for the future. In the South, current conditions shot up from 45.8 to 51.1 — a welcome respite for remodelers who had anticipated a continued drop.
Still, officials at the National Association of Home Builders (NAHB), which publishes the report, seemed optimistic, despite a slower rate of growth. David Seiders, chief economist at the NAHB, noted in a press release that his forecast for home remodeling spending is $233 billion in 2006, up from $215 billion in 2005.
Source: National Association of Home Builders