Metrostudy, a Hanley Wood company, announced today the release of its first quarter 2018 Residential Remodeling Index (RRI), detailing activity in the remodeling and replacement industry.
In first quarter 2018, the Residential Remodeling Index improved to a new all-time high of 112.9, which represents a solid increase of 5.2% from one year earlier and growth of 1.4% from the previous quarter. First quarter’s year-over-year gain was the strongest since first quarter 2014, while quarter-to-quarter growth was the highest since third quarter 2013, underscoring the current vigor within the industry.
The RRI has now experienced twenty-four consecutive quarters of year-over-year gains since the bottom of remodeling activity in 2011. The RRI is now forecast to average year-over-year gains of 5.1% throughout 2018, followed by 2.7% in 2019, and continue reaching new highs through 2020.
“Remodeling activity is being driven by solid gains in employment and rising home values, factors that are giving homeowners the confidence to invest in their homes,” said Mark Boud, chief economist at Metrostudy. “Americans are not only undertaking a greater number of remodeling projects, but larger and more expensive ones. And as a reflection of the long, slow economic expansion that we have been in, many more Americans are just now initiating replacement-type projects that had been deferred during the recovery from the Great Recession. We expect another strong year for the remodeling industry in 2018, and are waiting to see what effect recent tax cuts have on the economy. Early surveys suggest some Americans are increasing their remodeling budgets due to their taxes being lowered.”
Metrostudy produces the RRI to provide the industry visibility into local market remodeling activity, forecasted future activity, and potential demand. According to the company’s first quarter report, 370 Metropolitan Statistical Areas are forecast to see growth in 2018 project volume, and the average growth rate is expected to be 4.2%.
