Residential Remodeling Outlook
A newsletter from the Window and Door Manufacturers Association (WDMA) gave information on residential remodeling and repair expenditures based on two market indicators. The U.S. Department of Commerce reported that its estimate of fourth quarter 2003 residential remodeling and repair spending was 11 percent under third quarter spending. The National Association of Home Builders (NAHB) Remodeling Market Index (RMI), however, rose to a record level in the first quarter of the year with remodelers reporting positive views of current market conditions as well as expectations for the near future.
According to the Department of Commerce, total estimated expenditures last year for remodeling and repair rose 2 percent to $176.9 billion from $173.3 billion in 2002. Removing inflation, last year’s total produced a slight 0.3 percent decline, the first drop since 1998. Estimated spending for additions and alterations by last year’s owner occupants was $72.5 billion, essentially unchanged from 2002. The result surprised experts who expected a sharper rise after the record level of existing sales and the rise in the value of new homes.
Estimates for remodeling and repair in rental and vacant property also rose, 10 percent, following an 8 percent increase in 2002, possibly as a result of marked increases in the values of the properties.
In addition, the RMI has shown improved views of both current conditions and future expectations. The current conditions index was up 8.7 points from the fourth quarter of last year. Remodelers expect an even better time ahead, with the future expectations index jumping 14.5 points from the fourth quarter and 12.5 points above the same quarter a year ago. According to the WDMA, remodelers from all regions reported significant improvement in all types of jobs ranging from major additions and alterations to maintenance and repairs.
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