The Polyisocyanurate Insulation Manufacturers Association, or PIMA, Q4 2024 Market Index Survey for Reroofing was released last week and paints a mixed picture for the industry with contractors heading into the second month of 2025. 

While demand remains steady, rising material costs and lingering supply chain challenges continue to shape market conditions.  

The Project Contracts Index for the fourth quarter remained above 50, indicating continued expansion, though slower than earlier in the year. Steep-slope roofing contracts performed better than low-slope projects, with an index of 58.0 compared to 51.8. 

Overall, the project contracts index stood at 55.7, slightly declining from 59.4 in the previous quarter. This suggests that while demand persists, the industry is experiencing a modest slowdown, particularly in commercial and low-slope sectors.  

Customer inquiries also showed signs of softening, with the Customer Inquiries Index dropping from 66.8 in Q3 to 60.6 in Q4. Although the industry remains expanding, fewer customers are actively seeking new projects. 

The steep-slope sector saw the most resilience, posting an index of 62.5, while low-slope inquiries fell to 53.8. Some regions even reported inquiries below 50, indicating declining interest in new re-roofing work.  

Navigating an Evolving Market

Material costs remain a significant challenge, with over 70% of contractors reporting price increases on essential roofing products such as shingles, membranes, and insulation. Less than 5% noted any price reductions, reinforcing concerns over ongoing inflation and supply chain constraints. 

While some materials, such as asphalt shingles, have become more readily available, supply issues persist for single-ply membranes and insulation. 

Forty percent of contractors reported lead times exceeding eight weeks for membrane products, while 30% struggled to source insulation on time.  

Regional disparities also shaped market conditions. The Southeast and Southwest continued to grow with customer inquiries and contract indices above 65, while the Midwest and Northeast experienced stagnation or slight declines. 

The West saw mixed results, with some areas reporting steady growth and others experiencing slowing demand. These variations contributed to economic factors, weather conditions, and local construction trends.  

Five Takeaways:

• Continued but Slowing Expansion: The Project Contracts Index remained above 50, indicating growth, but declined from 59.4 in Q3 to 55.7 in Q4, signaling a modest slowdown, particularly in commercial and low-slope roofing sectors.
• Declining Customer Inquiries: The Customer Inquiries Index dropped from 66.8 in Q3 to 60.6 in Q4, showing reduced interest in new reroofing projects. Inquiries fell below 50 in some regions.
• Rising Material Costs and Supply Chain Challenges: Over 70% of contractors reported price increases on essential roofing materials, while supply chain issues persisted, especially for single-ply membranes and insulation, with long lead times.
• Regional Market Disparities: The Southeast and Southwest experienced strong growth, while the Midwest and Northeast stagnated or declined. Depending on local factors, the West had mixed results.
• Market Uncertainty for 2025: While demand remains positive, contractors must navigate rising costs, shifting demand, and supply chain unpredictability, requiring strategic pricing, material management, and regional adaptation.

Looking Ahead: 2025  Outlook

Looking ahead, contractors face a balancing act between rising costs, shifting demand, and unpredictable supply chains. Profitability will depend on strategic pricing, efficient material sourcing, and regional market positioning. 

While demand remains positive, the reroofing market appears to be entering a more cautious phase, requiring adaptability and careful planning in 2025.