Washington, D.C.—The National Association of Home Builders (NAHB) reported stable remodeling market sentiment in the third quarter. The NAHB Remodeling Market Index (RMI) rose one point from the previous quarter to 62.
The RMI survey asks remodelers to rate five components of the remodeling market as “good,” “fair” or “poor.” Each question uses a scale from 0 to 100.
An index reading above 50 means more remodelers view conditions as good than poor. NAHB seasonally adjusts the RMI results.
The Current Conditions Index averages three components. They include the current market for large remodeling projects, moderately sized projects and small projects.
The Future Indicators Index averages two components. They include the current rate of leads and inquiries and the backlog of remodeling projects.
NAHB calculates the overall RMI by averaging the Current Conditions Index and Future Indicators Index.
“Remodeler sentiment remained stable in the third quarter, although remodelers in certain parts of the country continue to report issues with high material costs and finding enough labor to finish projects on time,” said Elliott Pike, NAHB Remodelers chair and a remodeler from Homewood, Ala. “Remodelers also report that economic uncertainty is making some potential customers hesitant to move forward with projects.”
Robert Dietz, NAHB chief economist, added, “The third quarter reading of 62 for the RMI is consistent with NAHB’s projection for remodeling activity to remain stable in 2026 and grow slightly in 2027. Labor shortages, exacerbated by immigration enforcement and competition from data center construction, are extending the time it takes to complete projects. Nevertheless, remodeling is gaining share in the overall construction market, as it is somewhat less sensitive than new construction to the current elevated interest rates.”
Current conditions remain strong
The Current Conditions Index averaged 70 for the third consecutive quarter. All three components remained well above 50.
The index for large remodeling projects of $50,000 or more increased two points to 66. The measure for moderate projects of at least $20,000 but less than $50,000 fell two points to 71.
The index for small remodeling projects under $20,000 slipped one point to 73.
The Future Indicators Index averaged 54, up two points from the previous quarter.
The measure tracking the current rate of leads and inquiries rose two points to 53. The component measuring the backlog of remodeling jobs also increased two points to 56.
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