Construction spending rose 1.0 percent in November, which was better than the consensus estimate. Previous months’ data were also upwardly revised. Residential and nonresidential rose on the month, while public fell.
Private Residential Reaches Highest Level Since 2008
Overall construction spending rose to a $934.4 billion annualized pace in November, the highest level since 2009. Private residential spending rose 1.9 percent on the month with increases in single-family, multifamily and home improvement. Fears that the rise in mortgage rates could dampen the housing recovery have been put aside as single-family outlays rose 1.8 percent and are up more than 18 percent over the past year.
Private Nonresidential Shows Positive Gain
Private nonresidential rose 2.7 percent on the month and is up 13.3 percent on a three-month annualized basis. The increase suggests structure outlays will continue to make a contribution to real GDP in the fourth quarter. Gains on the month were led by commercial and manufacturing while health care and education spending were weak. Public construction spending fell 1.8 percent on the month with broad-based declines.