The National Association of Home Builders' Remodeling Market Index dropped to a lower reading than usual in the first quarter of 2016. At 54, it is the lowest RMI in two years. However, this does not mean the remodeling market is in trouble.
The NAHB pointed out in a press release that any reading over 50 shows a positive outlook on the market.
"Remodelers were solidly booked for jobs in the first quarter of 2016 but calls and appointments for work slowed down in comparison to the end of 2015," explained Tim Shigley, the 2016 NAHB Remodelers Chair and Kansas-based remodeler, in a statement. "Volatility in the financial markets during the first quarter may have impacted consumers' readiness to commit to projects."
Among the separate components of the index, major additions and alterations went up one point from the last quarter of 2015 to 55. Major projects are defined as those valued at $25,000 or more. Minor alterations and additions, on the other hand, decreased two points to 54.
As more people are willing to put money into upgrading their home, their reasons for tackling projects are changing as well. The NAHB found that improving energy efficiency and environmental concerns has decreased as a popular reason to remodel, while several reasons have become more prevalent:
The two reasons that gained the most momentum in the last few years are the desires to age in place and to improve the value of a home. Both of these are important goals, and both often require not only maintenance work, but changes to the home itself.
For instance, a person hoping to live out the rest of his or her years in a home might choose to add a wheelchair ramp to the home, add light switches to every hallway or room entrance and make changes to the bathroom. These might include adding grab bars around the toilet and tub, or changing the traditional tub to a walk-in model that is easier to use.
"Adding light switches to every hallway can help someone age in place."
Someone who wants to improve the resale value of his or her home will likely focus on the kitchen and bathrooms.
Making these changes is important if the homeowner is going to achieve his or her goals to either age in place safely in the house, or to sell it for a profit. However, these projects often can become costly.
Someone worried about pricing might opt for subpar alterations in an attempt to save money, or to forego others. This can be more harmful than helpful in the long run.
To help your customers make the changes they need to their home, whatever their goal may be, you can offer financing options to help offset the cost. These programs will help them achieve their homeownership goals in an efficient, affordable manner.