Remodeling Sentiment Highest in Five Years

Washington, DC, Jan. 27, 2012 -- Remodeling sentiment rose to the highest level in five years, according to the National Association of Home Builders’ Remodeling Market Index for the fourth quarter of 2011.

The index increased to 46.6 in the fourth quarter from 41.7 in the third quarter.

The index component measuring current market conditions rose to 48.4 from 43.0 in the previous quarter. The component measuring future indicators of remodeling business was also positive, increasing to 44.8 from 40.4 in the previous quarter.

An index below 50 indicates that more remodelers report market activity is lower compared to the prior quarter than report it is higher.

“As more consumers remain in their homes rather than move in this economy, remodelers benefited from a gradual increase in home improvement activity, taking us to a five-year high,” said NAHB Remodelers Chairman Bob Peterson, a remodeler from Ft. Collins, Colo.

“2011 ended on a strong note for the remodeling industry.”

Current market conditions improved significantly in all four regions.

“With several key components above 50, the latest index provides reason for guarded optimism going forward,” said NAHB Chief Economist David Crowe.

“The residential remodeling market has been improving gradually, mirroring the trend in other segments of the housing market. Stringent lending requirements and economic uncertainty continue to be a drag on demand, but we expect a modest growth in remodeling activity to continue throughout 2012.”