This article originally appeared on the BUILDER website.

The kitchen and bath industry has continued to expand in the second quarter of 2019, with an index score of 65.7 on the National Kitchen and Bath Association and John Burns Real Estate Consulting’s latest Kitchen and Bath Market Index.

The growth rate has slowed some from the first quarter, when the KBMI hit 71. (Scores above 50 indicate growth.) However, the industry’s outlook remains optimistic, with a 69 reading for future conditions and a 63 index reading for current conditions.

Sales are expected to grow by 4.7% in 2019, and more than half of industry experts (53%) expect sales to rise in the third quarter of 2019, while one-third (36%) predict that sales will remain flat. Among respondents, manufacturers are the most optimistic, with 63% expecting growth and less than 10% seeing a decline.

Industry professionals rate the industry’s health at 6.6 out of ten, down but comparable to the 6.8/10 rating given in Q1. Building and construction firms have given the highest rating out of the respondent groups at 7/10.

While 57% of consumers have increased their total spending on the kitchen and bath industry since 2018, the NKBA attributes this to the rising costs of materials and labor, rather than consumer behavior. Material costs, trade issues, and availability of skilled professionals have been named the greatest overall industry challenges for the second quarter in a row. Builders cite a lack of skilled labor as the greatest barrier to growth, while designers site a slowing luxury market.

“As the leading trade association and advocate for the kitchen and bath industry, one of NKBA’s goals is to arm our members with market insights, as well as to raise awareness about impactful industry challenges,” says Bill Darcy, NKBA CEO. “Although NKBA members are still optimistic about current and future kitchen and bath business conditions, there are signs of changes in the marketplace that we are monitoring closely.