Residential Sector Continues to Drive Construction Spending *Mortgage News Daily
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Nationwide spending on construction edged up fractionally in March, but the big story was the annual gain in residential construction spending, especially for new single-family housing. The U.S. Census Bureau said construction, public and private, for all sectors inched up 0.2 percent from February and was 5.3 percent higher compared to March 2020 at $1.513 trillion. However, residential spending gained 23.3 percent on an annual basis.
Virtually all residential spending was in the private sector. Overall, the seasonally adjusted annual rate of total public expenditures in March was 1.169 trillion compared to 1.160 trillion in February, an 0.7 percent gain and 8.6 percent more than was spent a year earlier. The residential spending rate constituted more than half that figure at $745.245 billion. This represented 1.7 percent growth from the $713.056 billion spent the prior month and 23.3 percent more than the spending rate in March 2020.
Single-family construction was put in place at a rate of $389.922 billion, up 2.0 percent month-over-month and a 26.7 percent annual gain. New multifamily construction, at a rate of $93.453 billion, was down 0.3 percent from February while remaining 14.6 percent higher on an annual basis. Spending on residential remodeling rose 2.0 percent month-over-month.
On a non-adjusted basis, total public and private spending, was $117.51 billion for the month and totals $328.285 billion for the year-to-date (YTD). The latter figure is 4.5 percent higher than spending during the first three months of 2020.
Private sector spending totaled $93.462 billion during the month and was $260.076 YTD, a 6.3 percent increase. Again, this was dwarfed by gains in residential construction. The months spending in that sector was $57.819 billion, $30.891 of which was for new single-family houses. YTD the two total $155.799 billion and $83.472 billion, increases of 20.8 percent and 26.9 percent, respectively. Multifamily construction consumed $7.701 billion during the month and is up 14.5 percent YTD.
Residential spending was down in February in the public sector but is up significantly from last year. Both overall and residential spending from government sources declined 1.5 percent from February at an annual rate of $343.886 billion and $9.323 billion respectively. Residential spending was 18.0 percent higher than a year earlier while total spending was down 4.6 percent. YTD total spending at $68.209 billion is lagging 2020 by 1.8 percent while residential spending is up 19.6 percent.