According to the National Association of Home Builders Remodelers’ Cost of Doing Business Study, remodeler profit margins may be up just a bit, but overall net margins are flat.
NAHB’s nationwide survey of residential remodeling companies found that on average, remodelers reported $2.3 million in revenue for fiscal year 2018, of which $1.6 million (69.9%) was spent on cost of sales (e.g., labor, material, and trade contractor costs) and another $563,000 (24.8%) on operating expenses (e.g., general and administrative, finance, and S&M expenses, owner’s compensation). As a result, the industry average gross profit margin for 2018 was 30.1%, with a net margin of 5.2%.
The builder’s group surveyed remodelers this year, based on 2018 fiscal information compared to 2015 and 2011.
For more details see NAHB’s Eye on Housing blog.