Consumer uncertainty fueled by rising costs and tariff concerns is cooling interest in the home remodeling market, according to a first-quarter 2025 survey by the National Association of Home Builders (NAHB) and Westlake Royal Building Products.

The survey’s quarterly remodeling market index (RMI) showed the overall attitude among remodelers remains positive but has begun to wane in the past three months. The quarterly RMI was down five points from the fourth quarter 2024 survey to an overall score of 63. Remodelers surveyed also reported that suppliers have raised prices by nearly 7% since January in anticipation of the implementation of tariffs.

Any score above 50 indicates that a greater share of remodelers view conditions as good, while any score below 50 means that a majority of remodelers view conditions as poor. The index is an average of responses from those involved in large remodeling projects ($50,000 or more), moderately sized projects (projects costing at least $20,000, but less than $50,000) and small projects (under $20,000). The remodelers were also asked to rate five components of the remodeling market by describing the market as either good, fair or poor.

The survey’s current conditions index averaged 71, dropping four points compared to the previous quarter. The component measuring large remodeling projects fell 11 points to 64. The component measuring moderate remodeling projects dropped slightly to 72, and the small projects component was unchanged at 76.

Nicole Goolsby Morrison, the NAHB remodelers chair, said that rising homeowner equity and limited opportunities to move into other homes is still supporting the home improvement market and keeping remodeler sentiment positive. But attitudes have soured a bit since last quarter as some remodelers are reporting that uncertainty about tariffs and the direction of the economy are making customers hesitant to spend on larger projects.

“The five-point decline in the RMI likely reflects consumer uncertainty, fueled by rising costs and tariff concerns,” said NAHB Chief Economist Robert Dietz. “Although almost all the data for the first-quarter RMI were collected before the release of specific reciprocal tariffs, the debate and uncertainty over tariffs has had an effect on consumer confidence. Indeed, remodelers responding to the RMI survey reported that their suppliers have already increased prices by an average of 6.9% since January, due to the anticipated effect of tariffs.”