"Surging home sales, steadily rising home values (against which people borrow to finance improvements) and a low-interest-rate environment all contributed to the pickup in remodeling in the second quarter," said the association's Remodelers Council Chairman Mike Weiss. "Moreover, signs of an improving economy and rejuvenating consumer confidence mean the future is looking even brighter for professional remodelers."

"Remodelers are registering substantially more calls for bids, commitments for work over the next three months and backlogs of jobs in the pipeline than they have since at least the beginning of last year. That's a good basis for a truly optimistic outlook," said the association's Chief Economist David Seiders.

The West was the strongest region for professional remodeling in 2003's second quarter, posting the highest readings for both current market conditions and future expectations. Every region posted gains from the previous quarter with the exception of the Northeast, where current market conditions rose but future expectations slid several points.

Thirty-five percent of remodelers in the latest survey identified "local government regulations" as a significant source of challenges for their firms, and this too is a continuing concern charted by past surveys. Looking forward, 52 percent predicted that government regulations regarding mold, lead paint removal and other issues would weigh heavily in the industry over the next five years.

A growing concern among remodeling pros is "low bidding by fly-by-night contractors," which 49 percent identified as a problem in their market in this year's second quarter. "Legitimate professional remodelers are definitely raising a red flag regarding low-ball operators in their area," said Weiss. "We're advising consumers to ask for references, check with their local Better Business Bureau and verify that they are dealing with a reputable business before signing a contract for home remodeling and/or repairs."

Asked to rate the importance of a variety of factors to their businesses' growth potential, "company reputation" was by far the most strongly valued element, followed immediately by "availability of trained labor."

"Shortage of skilled labor is a typical symptom of a strong remodeling market," said Weiss. "It makes sense that amidst such an atmosphere, a remodeler's standing in the local community makes all the difference, because it indicates whether the company can do a good job, on-time and on-budget."

For more information check out http://www.nahb.org.

Information provided in this column is presented by the Realtor members of the Silicon Valley Association of Realtors at www.silvar.org. Send questions on any topic to jnewton@jnpr.com.