Following its best year since 2008, the residential remodeling and replacement industry experienced a slightly weaker start to 2014 than originally forecast according to the latest release of the Residential Remodeling Index (RRI) by Metrostudy, a Hanley Wood company. The seasonally adjusted first quarter national composite of the RRI registered a score of 95.2, which was a 0.7 percent improvement over the revised fourth quarter result of 94.5.
Year-over-year, the index gained 6.6 percent, marking the ninth consecutive quarterly improvement since the market bottomed at the end of 2011.
“The first quarter was only slightly weaker than forecasted amidst strong housing market fundamentals, better consumer confidence, and improving economic conditions,” remarked Jonathan Smoke, Chief Economist of Hanley Wood. “We are hearing from remodelers and contractors all across the country that the weather did impact their ability to execute from job site issues to labor and material delays. With the winter now behind us and our forecast remaining strong for 2014, we expect to see the pace of growth improve throughout the year. Remodelers remain quite confident about their business based on our April survey of remodelers and replacement contractors. On a national basis, the quality and volume of their job backlog is high and the corresponding quality and volume of leads and inquiries is even higher.”
Metrostudy produces the RRI to provide the industry visibility into local market remodeling activity, forecast future activity, and potential demand. According to the company’s fourth quarter report, 360 out of 381 Metropolitan Statistical Areas should see year-over-year growth in remodeling and replacement projects in 2014, with markets averaging growth of 5 percent.