Private Residential Spending Increased in July
NAHB analysis of Census Construction Spending data shows that total private residential construction spending rose 0.5% in July to a seasonally adjusted annual rate of $773.0 billion. Total private residential construction spending was 27% higher than a year ago.
The monthly gains are attributed to the strong growth of spending on single-family construction and improvements. Single-family construction spending rose to a $416.3 billion annual pace in July, up by 0.9% over the upward revised June estimates. It increased by 47.1% on a year-over-year basis. Spending on improvements edged up 0.2% in July, after a 0.7% dip in June. Multifamily construction spending stayed flat in July but was 14.9% higher than a year ago.
The NAHB construction spending index, which is shown in the graph below (the base is January 2000), illustrates the solid growth in single-family construction and home improvement from the second half of 2019 to February 2020, before the COVID-19 hit the U.S. economy, and the quick rebounds since July 2020. New multifamily construction spending has picked up the pace after a slowdown in the second half of 2019.
Private nonresidential construction spending slipped to a seasonally adjusted annual rate of $458.0 billion in July, a 0.2% dip from upwardly revised June estimates. And it was 3.6% lower than a year ago. The largest contribution to this month-over-month nonresidential spending decrease was made by the class of power ($0.8 billion), followed by transportation ($0.2 billion), and class of communication ($0.1 billion). —