Lowe's Profits Skyrocket. Could this mean Home Improvements are on the Rise as Well?
Lowe's is one of America's largest home-improvement retailers. Recently, they've posted earnings that have exceeded their expectations as homeowners are growing continuing confidence in the current and coming housing market.
Over the last few years, home values have continued to rebound and Lowe's had been adding employees to help new homeowners with renovation projects.
The National Association of Home Builders (NAHB) reported last month that its remodeling market index (RMI) reclaimed the high-water mark of 57 during their third quarter which marks the sixth quarter in a row for an RMI reading above 50.
An RMI above 50 means that more remodelers are reporting activity is higher than it is lower compared to the prior quarter.
The future market conditions index for RMI rose to 58 from 56 in the second quarter. Call for bids, amount of work committed for the next three months, a backlog of jobs and appointments for proposals...all four of its subcomponents increased or stayed the same with the previous quarter's reading.
NAHB Chief Economist, David Crowe had this to say,
"The stabilization of the RMI in the mid-50s for more than a year demonstrates the slow, steady recovery of the housing industry that we expect to continue. The major headwind to stronger recovery is a shortage of qualified labor and subcontractors in the same parts of the county, making it difficult for remodelers to employ carpenters and finish projects as quickly and economically as many of their customers expect." [Source]