Posted in In The News, National Housing Market | Posted on 08-18-2015 | Written by Metrostudy News
WASHINGTON, D.C. (August 18, 2015) — Metrostudy, a Hanley Wood company, announced today the release of its second quarter 2015 Residential Remodeling Index (RRI) detailing activity in the remodeling and replacement industry.
The national RRI Activity Index beat previous expectations by reaching full recovery (a reading of 100.0 or more) in second quarter 2015. The index grew by a strong 5.5 percent year-over-year to reach 100.8 in second quarter. This bested previous calls for recovery of the remodeling and replacement industry to occur in third quarter 2015, and demonstrates the continued firming of demand fundamentals across the country. The RRI has now posted thirteen consecutive quarters of positive year-over-year gains since the industry hit bottom at the end of 2011.
Second quarter’s RRI measure also showed a gain of 1.5 percent over first quarter’s revised reading of 99.3, which now represents fourteen consecutive quarter-to-quarter increases. Additionally, the near term forecast for remodeling activity has strengthened over forecasts made in previous RRI releases.
“We saw a really good uptick in the Residential Remodeling Index in second quarter 2015. Not only did the index beat previous estimates for reaching a point of recovery in the remodeling industry, but growth through the first two quarters of 2015 is much stronger than what was observed in 2014, when the overall housing market had cooled,” says Brad Hunter, Chief Economist at Metrostudy. “A big driver of recent remodeling activity has been solid job gains, but the industry stands to benefit even more over the next year from existing home sales hitting an eight-and-a-half year high at the end of second quarter. Stronger resales benefits remodeling activity, as recent homebuyers typically spend more on home improvements than other homeowners. Continued home price appreciation is also encouraging people to put money into their homes.”
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 second quarter report, 355 out of 381 Metropolitan Statistical Areas are expected to see year-over-year growth in remodeling and replacement projects in 2015, with average growth of 5 percent.
For more information on accessing the full quarterly report, please email RRI@hanleywood.com.
About the Residential Remodeling Index
The RRI is a quarterly measure of the level of remodeling activity in 381 metropolitan statistical areas (MSA) in the U.S., with the national composite reflecting the national level of activity. “Activity” includes home improvement and replacement projects, but does not include maintenance or projects of less than $1000. The seasonally adjusted index shows the relative level of activity in the geography specified (MSA or national composite) compared to 2007 (the baseline year). A number above 100 indicates a level of remodeling activity higher than the level of activity at the beginning of 2007, which was the peak of remodeling activity in the prior decade.
The index is produced through a statistical model that leverages detailed data on remodeling activity, including household level remodeling permits, and consumer-reported remodeling and replacement projects. Quarterly historical results for the national composite and for each of the 381 Metropolitan Statistical Areas in the U.S. are available back to 2004. In addition, Metrostudy also produces annual estimates of project counts and expenditures as well as forecasts of the quarterly RRI and annual projects and expenditures.
Metrostudy, a Hanley Wood company, is the largest provider of comprehensive research and insight for the real estate industry. Builders, developers, banks, manufacturers, retailers and many other industries all rely on Metrostudy’s data and analytics to support strategic business decisions at the local, regional and national market level. www.Metrostudy.com
About Hanley Wood
Hanley Wood is the premier information, media, event, and strategic marketing services company serving the residential, commercial design and construction industries. Utilizing the largest editorial- and analytics-driven construction market database, the company produces powerful market data and insights; award-winning publications, newsletters and websites; high-profile executive events; and strategic marketing solutions. To learn more, visit hanleywood.com.