The National Association of Home Builders (NAHB) released its NAHB/Westlake Royal Remodeling Market Index (RMI) for the second quarter of 2025. The index reported a reading of 59, down four points from the previous quarter.

While Q2’s reading of 59 is positive, this is only the second time the index has dropped below 60 since the survey was revised at the beginning of 2020.

• The Current Conditions Index is an average of three components, including the current market for large remodeling projects, moderately sized projects and small projects.
• The Future Indicators Index is an average of two components, measuring the current rate of leads and inquiries coming in and the current backlog of remodeling projects.
• The overall RMI is calculated by averaging the Current Conditions Index and the Future Indicators Index. Any number over 50 indicates that more remodelers view remodeling market conditions as good rather than poor.

“Most remodelers continue to express positive sentiment, but some, especially in the western part of the country, are seeing a slowing of activity in their markets,” says Nicole Goolsby Morrison, NAHB remodelers chair and remodeler from Raleigh, North Carolina. “Those who report a slowdown have cited economic uncertainty stemming from government policies as the main reason.”

The Current Conditions Index averaged 66 points, dropping five points compared to Q1 2025. The Future Indicators Index averaged 51, down four points from the previous quarter.

“Although remodeler sentiment softened in the second quarter, overall it remains positive,” says Robert Dietz, NAHB chief economist. “High interest rates and economic uncertainty are headwinds for remodeling, but not to the extent that they have been for single-family construction. Even with these headwinds, NAHB is projecting that remodeling will post solid gains in 2025, followed by more modest but still positive growth in 2026.”

Retailers can address this dip by offering enticing and DIY-friendly products for homeowners considering renovations. Read how to curate your DIY product selection here.