According to the National Association of Home Builders, remodeling continues to outperform other parts of the housing market. Their latest Remodeling Market Index for the third quarter showed steady confidence, with a score of 62—one point higher than the previous period.
Over the last four years, the index has fluctuated only slightly, staying within the 59 to 70 range. The survey collects feedback from remodelers who assess the market’s health by labeling conditions as ‘good,’ ‘fair,’ or ‘poor.’
Robert Dietz, NAHB’s chief economist, noted that the third-quarter score of 62 aligns with expectations for steady remodeling activity in 2026 and modest growth in 2027. However, ongoing labor shortages are delaying project completions.
Remodeling projects are becoming a larger portion of the construction market, as they are less affected by rising interest rates than new builds. The Current Conditions Index held steady at 70 for the third quarter in a row.
For large projects costing $50,000 or more, confidence rose by two points to 66. Mid-sized jobs (between $20,000 and $49,999) saw a two-point drop to 71, while small projects (under $20,000) fell slightly to 73.
Elliott Pike, chair of NAHB’s Remodelers division, observed that while sentiment remained unchanged in the third quarter, contractors in some regions still face challenges with material prices and hiring skilled workers to meet deadlines.
The Future Indicators Index climbed to 54, up two points from last quarter. Both the backlog of pending remodeling jobs and the volume of new inquiries increased by two points, reaching 56 and 53, respectively.
The overall RMI is derived by combining the Current Conditions Index with the Future Indicators Index. A score above 50 means more remodelers perceive market conditions as favorable than unfavorable.
Robert Dietz notes that the stable market sentiment is a result of the remodeling industry’s ability to adapt to changing market conditions.
The National Association of Home Builders reports that the remodeling market is expected to remain stable in the coming years. Elliott Pike adds that remodelers are working to address the issues with material costs and labor shortages.
