The latest NAHB Remodeling Market Index (RMI) remained essentially unchanged at 40.8 in the third quarter, compared to 40.7 in the second quarter.

The index is on a scale of 0 to 100, where a number below 50 indicates that more remodelers believe conditions are poor than good. The RMI has been running below 50 since the final quarter of 2005.

The overall RMI combines ratings of current and future remodeling activity.

In the third quarter, the RMI component measuring current market conditions climbed to 43.4, up from 42.6 in the previous quarter. The RMI component measuring future indicators of remodeling business declined marginally, from 38.9 in the second quarter to 38.1.

"Consumers remain cautious about spending due to uncertainty in the economy, high unemployment and scarce credit," said NAHB Remodelers Chair Donna Shirey, CGR, CAPS, CGP, a remodeler from Issaquah, Wash. "Home owners may be looking at remodeling, but they are scared to take the leap."

The current conditions indexes for the remodeling market remained stable in three regions: the Northeast, 41.6 (up from 41.4 in the second quarter); Midwest, 44.9 (up from 44.7); and South, 42.3 (down from 42.4). Greater improvement was registered in the West, which jumped from 42.0 to 49.3.

Major additions increased modestly from 44.2 to 45.8 in the third quarter, minor additions rose from 45.8 to 46.4 and maintenance and repair increased from 36.6 to 37.1.

The indexes for future remodeling business stayed mostly level. Calls for bids slipped from 46.2 to 42.9. Work committed for the next three months increased from 27.9 to 30.3. The backlog of remodeling jobs dipped from 37.7 to 37.2, and appointments for proposals fell from 43.7 to 41.9.

"The remodeling market hit the same mid-year stall that the rest of the housing market and the economy hit. Remodeling continues to remain weak as consumers hold off on investing in their homes until they feel more confident about the overall economy," said NAHB Chief Economist David Crowe.

"The economy is growing,” he said, “but at a rate well below the level needed to reduce unemployment and ignite consumer confidence. For now, professional remodelers are concentrating on consumers' requests for smaller home improvements until the economic recovery strengthens."

For more information on NAHB’s remodeling resources, visit www.nahb.org/remodel.

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