The remodeling market slid backward during the second quarter, judging by the National Association of Home Builders latest remodeling market index.

The index, which combines current and future market indicators, sunk to 40.7 from 43.8 in the first quarter. The indicator for the current market slid back to 42.6 from its level in the first quarter of 44.5, and the indicator for the future market declined to 38.9 from 43.1.

The remodeling market index measures demand for current and future residential remodeling projects based on projects, remodelers' perceptions, and indicators of future activity such as calls for bids, amount of work committed, backlog of jobs, and appointments for proposals. Any number below 50 indicates that more remodelers say market conditions are getting worse rather than improving. The combined index has been running below 50 since the fourth quarter of 2005, after having been above 50 since the second quarter of 2003.

"Remodelers are suffering from weak consumer confidence and constricted credit lines," says NAHB Remodelers Chairwoman Donna Shirey, a remodeler from Issaquah, Wash. "Homeowners are delaying remodeling projects because of economic uncertainty."

The current index for the remodeling market worsened in two regions: the Northeast, where it fell to 41.4 from 46.6 in the first quarter, and the South, where it fell to 42.4 from 44.1.

It improved, however, in the Midwest, where the index rose to 44.7 from 43.8, and the West, where it jumped to 42.0 from 34.8. In figures for market segments, major additions fell to 44.2 from 48.0, and minor additions fell to 45.8 from 47.3. Maintenance and repair indicators declined by a smaller amount, to 36.6 from 37.3.

All the indices for future remodeling business declined. Calls for bids dropped to 46.2 from 49.4, and work committed for the next three months slumped to 27.9 from 29.9.

Meanwhile, the backlog of remodeling jobs dipped to 37.7 from 44.8, and appointments for proposals slid to 43.7 from 48.1.

In responding to additional special questions in the survey, remodelers also indicated the composition of the remodeling market is changing. Sixty-one percent said bathroom remodeling was one of their most common projects during the first half of 2010. Kitchen remodeling was next at 52 percent. In previous years, kitchen remodeling was reported as the most common activity by more than 70 percent of respondents.

Larger projects, such as room additions, whole house remodeling, bathroom additions, and second-story additions, have been on the decline for several years.

Smaller remodeling jobs, such as window and door replacements, have remained relatively steady, or, in the case of handyman services, actually increased. For example, only 29 percent of remodelers reported that room additions were a common activity in 2010, compared with 70 percent in 2004.

Conversely, none of the professional remodelers responding to the survey reported that it was common for their companies to perform handyman services in 2004, but 33 percent of remodelers were doing handyman work regularly in the first half of 2010.

"While remodelers are continuing to struggle, we expect the rest of 2010 to be a period of stabilization for remodeling, with the first stages of recovery emerging by the end of the year, followed by a more robust recovery beginning early next year," says NAHB Chief Economist David Crowe. "For now, professional remodelers are taking on smaller projects and working to find consumers willing to spend money despite the economic uncertainty."