NARI Reports Remodeling Market Continues to Show GrowthJanuary 21st, 2014 by Editor
The National Association of the Remodeling Industry’s (NARI) fourth-quarter Remodeling Business Pulse (RBP) data of current and future remodeling business conditions continues to show growth. Although remodelers report the highest overall rating on business conditions, at 6.51 (from 6.41 last quarter), numbers in most other categories experienced a slight drop.
“Many remodelers entered 2014 with jobs in the pipeline, which hasn’t happened in the past few years,” says Tom O’Grady, CR, CKBR, chairman of NARI’s Strategic Planning & Research Committee and president of O’Grady Builders, based in Drexel Hill, Pa. “Although inquiries, requests for bids and conversion of bids are down in Q4, that backlog has given remodelers confidence that the overall business conditions will remain positive.”
Growth indicators in the fourth quarter of 2013 are as follows (rating is from 1 to 9, where 1 is much worse than a year ago and 9 is much better; 5 is about the same as last year):
- Current business conditions was rated 6.51 (from 6.41 last quarter)
- Number of inquiries fell to 6.2, a significant drop from 6.55 last quarter.
- Requests for bids fell to 6.22 from 6.45, a significant decline from last quarter.
- Conversion of bids to jobs continues to be the weakest measure remaining flat at 6.03.
- Value of jobs sold declined to 6.27 from 6.31 recorded last quarter.
Conversion of bids to jobs continues to be the weakest measure when compared to the same time last year. Yet, the projected strength of sales in three months had a significant increase to 6.41 from the 6.12 recorded in September.
“The fourth quarter of this year was very strong for many remodelers, as reflected in the Remodeling Business Pulse Survey,” O’Grady says. “Average sale prices continue to rise, and consumers are more comfortable spending money on projects that will increase the value of their homes.”
Other significant contributors to overall activity:
- People needing to do projects that had been postponed was selected by 75 percent (down from 85 percent last quarter)
- Improving home prices came in second, at 60 percent of respondents (down from 72 percent in September).
- Economic growth improved continued at the No. 3 spot, at 52 percent (an increase of 6 percent from last quarter).
“The outlook forecasts that favorable business conditions will remain strong across all regions of the United States,” O’Grady says. “Consumer confidence is up, which translates into more homeowners feeling safe investing in their homes.”