Recent real estate property records indicate that the number of remodeling projects that took place between April and June diminished between April and June.
The National Association of Home Builders' Remodeling Market Index dipped to 45 from 47 in the previous quarter. In 2011, the RMI reached 48 on two separate occasions, the highest reading recorded since prior to the housing collapse.
Another component of the RMI that fell in the second quarter was the figure that measures market conditions, which diminished to 46 from 49 between January and March.
The RMI is measured on a scale from 1 to 50. Any reading above 50 indicates builders think remodeling activity is healthy.
George Moore, NAHB's remodelers chairman, said builders' pessimism about the market may stem from their ability to obtain the funds necessary to complete these projects.
"The positive outlook is constrained by continuing credit constraints and inaccurate appraisals that make customer financing difficult for big jobs like additions and whole house remodels," said Moore.
David Crowe, chief economist at NAHB, added that the index also reflects a weak labor market that's been evident for the past several months in the Commerce Department's employment reports.