Marking the sixth consecutive month of increases, new residential construction spending soared 3.3% on a seasonally adjusted (SA) basis in September following an almost as strong 3.0% rise in August. Not seasonally adjusted (NSA) year-to-date spending was up 16.1% from the same period in 2011. Single-family construction spending jumped 3.9% in September following a 3.4% advance in August. Multifamily construction spending rose a relatively modest 0.7% after improving 1.3% in August. Year-to-date, single-family construction spending increased 15.9% and multifamily spending increased 16.7% over the same period a year ago.
Residential Construction Spending Data | ||||||||
| Monthly Figures (1) (latest actual values) |
3-Month Moving Average | Year-to-Date (NSA) | ||||||
| Jul-12 | Aug-12 | Sep-12 | Jul-12 | Aug-12 | Sep-12 | Jan-11 to Sep-11 |
Jan-12 to Sep-12 |
|
| New Single-family | 127.7 | 132.0 | 137.1 | 125.0 | 128.4 | 132.3 | 80.2 | 93.0 |
| Month-over-Month % Change | 1.7% | 3.4% | 3.9% | 2.2% | 2.7% | 3.0% | ||
| (Year-over-year % change of NSA data) | 18.6% | 21.2% | 25.8% | -6.5% | 15.9% | |||
| New Multifamily (2) | 27.7 | 28.1 | 28.3 | 27.2 | 27.7 | 28.0 | 16.9 | 19.8 |
| 1.0% | 1.3% | 0.7% | 2.8% | 2.2% | 1.0% | |||
| 24.4% | 18.7% | 20.6% | -6.8% | 16.7% | ||||
| New Residential (3) | 155.4 | 160.1 | 165.3 | 152.2 | 156.1 | 160.3 | 97.2 | 112.8 |
| 1.6% | 3.0% | 3.3% | ||||||
| 19.6% | 20.8% | 25.0% | -6.5% | 16.1% | ||||
| Residential Improvements (4) | 125.8 | 124.4 | 126.8 | 123.8 | 125.0 | 125.7 | 84.5 | 91.0 |
| 0.8% | -1.1% | 2.0% | 2.8% | 1.0% | 0.6% | |||
| 27.0% | 15.1% | 12.5% | 0.9% | 7.6% | ||||
| Total Residential (5) | 281.2 | 284.4 | 292.2 | 275.9 | 281.1 | 285.9 | 181.7 | 203.8 |
| 1.2% | 1.2% | 2.7% | 2.5% | 1.9% | 1.7% | |||
| 22.9% | 18.1% | 19.4% | -3.2% | 12.1% | ||||
(1) Monthly levels are seasonally adjusted at annual rates (SAAR figures). | ||||||||
Single-Family Housing
October single-family housing starts slipped 0.2% to 594,000 at a seasonally adjusted annual rate (SAAR), essentially unchanged from September’s 595,000 starts. September’s starts had skyrocketed 10.6% from August’s 538,000 starts.
Single-family building permits rose 2.2% to 562,000, their highest level since July 2008, from September’s 550,000. The November NAHB/Wells Fargo Housing Market Index (HMI), jumped 5 points to 46, its highest level since May 2006. Increases in the HMI have been strongly correlated with increased housing starts one to two months later.
Multifamily Housing
For the second month in a row multifamily starts registered a strong increase. October multifamily starts jumped 11.9% to 300,000 (SAAR), following a 26.4% surge in September to 268,000. However, since multifamily starts are highly volatile from month to month, the three-month moving average is often used to better gauge multifamily activity. The three-month moving average for October was 260,000, up 11.1% from September and its highest level since September 2008. The average has been above 200,000 starts for a year. Meanwhile, October’s three-month moving average of multifamily building permits of 311,000 was also at its highest level since September 2008.
Residential Construction Data | ||||||||||
| Monthly Figures (1) (latest actual values) |
3-Month Moving Average | Year-to-Date (NSA) | Year-to-Date (NSA) | |||||||
| Aug-12 | Sep-12 | Oct-12 | Aug-12 | Sep-12 | Oct-12 | Jan-11 to Sep-11 |
Jan-12 to Sep-12 |
Jan-11 to Oct-11 |
Jan-12 to Oct-12 |
|
| Northeast Starts | 74 | 77 | 72 | 79 | 79 | 74 | 50 | 60 | 56 | 66 |
| Month-over-Month % Change |
-14.0% | 4.1% | -6.5% | -0.8% | -0.4% | -5.9% | ||||
| Year-over-year % Change of NSA data |
32.7% | 32.7% | 13.8% | -7.9% | 19.0% | -9.7% | 18.5% | |||
| Midwest Starts | 130 | 146 | 159 | 113 | 129 | 145 | 74 | 90 | 84 | 105 |
| 17.1% | 12.3% | 8.9% | 6.9% | 14.2% | 12.4% | |||||
| 50.0% | 42.1% | 53.0% | -3.4% | 20.9% | -1.5% | 24.7% | ||||
| South Starts | 376 | 442 | 431 | 363 | 389 | 416 | 234 | 299 | 261 | 336 |
| 8.0% | 17.6% | -2.5% | 1.0% | 7.0% | 7.1% | |||||
| 22.4% | 35.7% | 38.2% | -1.9% | 27.6% | 0.2% | 28.7% | ||||
| West Starts | 170 | 198 | 232 | 188 | 184 | 200 | 101 | 132 | 112 | 151 |
| -7.1% | 16.5% | 17.2% | 2.4% | -2.5% | 8.9% | |||||
| 17.9% | 19.9% | 80.2% | 4.8% | 29.9% | 7.2% | 34.7% | ||||
| Total Starts (2) | 750 | 863 | 894 | 744 | 780 | 836 | 460 | 580 | 513 | 658 |
| 3.0% | 15.1% | 3.6% | 2.0% | 4.9% | 7.1% | |||||
| 26.6% | 32.3% | 46.4% | -1.5% | 26.2% | 0.1% | 28.3% | ||||
| Single-family Starts | 538 | 595 | 594 | 525 | 546 | 576 | 331 | 407 | 367 | 458 |
| 6.3% | 10.6% | -0.2% | 1.6% | 4.1% | 5.4% | |||||
| 25.1% | 38.3% | 40.3% | -12.0% | 23.1% | -10.9% | 24.8% | ||||
| Multifamily | 212 | 268 | 300 | 219 | 234 | 260 | 129 | 173 | 146 | 200 |
| -4.5% | 26.4% | 11.9% | 3.0% | 6.8% | 11.1% | |||||
| 30.5% | 21.9% | 59.4% | 41.2% | 34.0% | 44.9% | 37.0% | ||||
| New Home Sales (3) | 366 | 369 | 368 | 364 | 367 | 368 | 233 | 283 | 258 | 312 |
| 0.0% | 0.8% | -0.3% | -0.3% | 0.8% | 0.2% | |||||
| 24.0% | 20.8% | 16.0% | -9.0% | 21.5% | -7.5% | 20.9% | ||||
| Manufactured Home Shipments |
57 | 47 | NA | 53 | 52 | NA | 37 | 42 | 42 | NA |
| 12.9% | -18.4% | 1.0% | -2.6% | |||||||
| 7.6% | -13.1% | -7.3% | 13.1% | -3.1% | ||||||
Housing starts, home sales, and manufactured home shipments are all in thousands. | ||||||||||
Outlook for Residential Construction
Overall, the outlook for the housing market is for continued improvement.
The housing construction forecast assumes the continuation of better economic growth and employment, low interest rates, declining vacancy rates, and rising rents. The new residential construction spending forecast is for an increase of 18.4% in 2012, 19.7% in 2013, and 15.4% in 2014.
Residential Construction Data |
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| Actual | Forecast | |||||
| 2009 | 2010 | 2011 | 2012 | 2013 | 2014 | |
| Northeast Starts | 62 | 72 | 68 | 78 | 91 | 107 |
| (Year-over-year % change of NSA data) | -48.9% | 15.9% | -5.4% | 15.5% | 15.8% | 18.2% |
| Midwest Starts | 97 | 98 | 101 | 125 | 165 | 176 |
| -28.0% | 0.8% | 3.1% | 24.2% | 31.6% | 6.8% | |
| South Starts | 278 | 298 | 308 | 398 | 461 | 516 |
| -38.6% | 6.9% | 3.5% | 29.1% | 15.8% | 12.1% | |
| West Starts | 117 | 120 | 133 | 181 | 263 | 328 |
| -40.5% | 2.7% | 10.5% | 36.5% | 45.2% | 24.8% | |
| Total Starts (1) | 554 | 587 | 609 | 782 | 979 | 1128 |
| -38.8% | 5.9% | 3.7% | 28.4% | 25.2% | 15.2% | |
| Single-family Starts | 445 | 471 | 431 | 539 | 658 | 761 |
| -61.6% | 6.2% | 54.0% | 36.4% | 31.9% | 14.4% | |
| Multifamily Starts | 109 | 116 | 178 | 243 | 321 | 367 |
| -28.4% | 5.9% | -8.6% | 25.2% | 22.1% | 15.6% | |
| New Home Sales (2) | 375 | 323 | 306 | 373 | 445 | 538 |
| -22.7% | -13.9% | -5.3% | 21.8% | 19.4% | 20.8% | |
| Manufactured Home Shipments | 50 | 50 | 52 | 55 | 62 | 70 |
| -39.2% | 0.5% | 3.1% | 7.2% | 11.6% | 13.4% | |
| Residential Construction Spending (Billions of Current Dollars) | ||||||
| New Single-family | 105.3 | 112.6 | 108.2 | 128.0 | 152.7 | 176.7 |
| -43.3% | 6.9% | -3.9% | 18.3% | 19.4% | 15.7% | |
| New Multifamily (3) | 35.9 | 24.1 | 22.6 | 27.0 | 32.7 | 37.3 |
| -30.0% | -32.9% | -6.0% | 19.2% | 21.1% | 14.1% | |
| New Residential (4) | 141.2 | 136.7 | 130.8 | 154.9 | 185.4 | 214.0 |
| -40.4% | -3.2% | -4.3% | 18.4% | 19.7% | 15.4% | |
| Residential Improvements (5) | 112.7 | 112.5 | 114.9 | 122.7 | 132.4 | 142.9 |
| -6.6% | -0.2% | 2.2% | 6.8% | 7.9% | 8.0% | |
| Total Residential (6) | 253.9 | 249.1 | 245.7 | 277.6 | 317.8 | 356.9 |
| -29.0% | -1.9% | -1.4% | 13.0% | 14.5% | 12.3% | |
Housing starts, home sales, and manufactured home shipments are all in thousands. |
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Read more forecasts from Reed Construction Data:
Construction Spending Edges Up in September
Nonresidential Building Construction Spending Down in September
Heavy Engineering Construction Spending Rose Modestly in September
