Home Remodeling Market Stronger in 4Q, Index Hits 9-Year High

Home Remodeling Market Stronger in 4Q, Index Hits 9-Year HighThe home remodeling market got stronger in the fourth quarter of 2012, hitting a level not seen since the first quarter of 2004, according to an index from the National Association of Home Builders.
The Remodeling Market Index (RMI) reached 55 in the fourth quarter, increasing five points from the previous quarter.
An index level above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it is lower. The overall index averages ratings of current remodeling activity with indicators of future remodeling activity.
“Remodelers are optimistic about the outlook for slow and steady market growth in the new year,” said 2013 NAHB Remodelers Chairman Bill Shaw, a remodeler from Houston. “Professional remodelers reported more work from large and small projects as well as overall home repair.”
Future market indicators increased from 49 in the previous quarter to 56. Current market conditions also showed improvement, rising from 52 in the previous quarter to 54.
Remodeling projects were especially strong in owner-occupied properties, rating all categories of remodeling in owner-occupied homes 56 or better.
“With existing home sales up, the increase in the RMI partially reflects the remodeling work new home owners undertake when they move in,” said NAHB Chief Economist David Crowe. “Consumers are gaining confidence in the economy and feeling more comfortable pulling the trigger on large and small renovations.”
The RMI was above 50 in all four regions of the country. The RMI in the Northeast surged 24 points, primarily due to the start of remodeling work related to Superstorm Sandy damage.

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