The residential remodeling market continued its slump during 3Q 2008, according to the National Association of Home Builders' (NAHB) Remodeling Market Index (RMI). The current market conditions indicator declined to 33.5, from 41.8 in the last quarter. Future expectations of remodeling work also slid to 27.7 (from 38.0 in the second quarter). Both these indices rest at historic lows since the start of the RMI in 2001.
The RMI measures remodeler perceptions of market demand for current and future residential remodeling projects. Any number over 50 indicates that the majority of remodelers view market conditions as improving. The RMI has been running below 50 since the final quarter of 2005, implying decreasing remodeling expenditures since that time.
Nationally, current activity for major additions and alterations shrank to 29.38 (from 43.18 in the second quarter) during the third quarter, while minor additions and alterations slowed to 38.51 (from 42.89). Maintenance and repair dropped to 30.92 (from 39.06)
Regionally, current market expectations fell in the third quarter, with the South dropping to 31.5 (from 40.1 in the second quarter), the Midwest to 36.2 (from 52.9), and the West to 36.1 (from 42.4). The Northeast increased slightly to 32.9 (from 32.8). The Midwest, however, increased to 52.9 (from 44.1). All measures for future expectation (calls for bids, amount of work committed for next three months, backlog of remodeling jobs, and appointments for proposals) declined.
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