Led by California and Texas, twenty states account for more than 75% of the US construction market. The projected recovery in the construction market early next year must be driven by a significant improvement in a large share of these key states. A pickup in construction activity in the thirty smaller states would not be sufficient to set off a national market recovery, says Reed Construction Data chief economist Jim Haughey.

Accompanying this report are tables and charts based on RSMeans’ measures of dollar-per-square-foot construction costs. The results for 25 major cities are shown for four care and shelter types of structure. It is most expensive to build a two- to three-story hospital. A little less expensive on a dollar-per-square-foot basis is a four- to eight-story hospital. Stepping down by about one-quarter is an eight- to 24-story apartment building. Cheapest to construct, at just about half the expense of a low-rise hospital, is a nursing home. This story also presents a number of key city cost comparisons.

This report will provide information on key price movements in the U.S. economy.  First will be a look at home prices, where the news is almost all good. Then the emphasis will shift to commodity prices, where the assessment of the news depends on one’s perspective. Tied to commodity prices is what has been happening to the value of the U.S. dollar in international currency markets.  The bonds are fascinating and the shifts in opposite directions are not just a coincidence. The only conclusion to be reached is that prices in general are beginning to firm up.

Accompanying this report are tables and charts based on RSMeans’ measures of dollar-per-square-foot construction costs. The results for 25 major cities are shown for four “industrial shell” types of structure. It is most expensive to build a factory. The second-most expensive is an auto sales garage. Third spot belongs to an aircraft hangar. In last position, and a considerable step down from the other three, is a warehouse. It is almost one-quarter or 25% cheaper to build a warehouse than a three-story factory, on a square footage basis. This story also presents a number of key city cost comparisons. 

The housing market improved abruptly in July with another large gain in August. However, most of the reported 4.2% August gain was due to a sharp downward revision of July remodeling spending. This is implausible and may well be revised away shortly as several similar huge month to move changes in this market have been, says Reed Construction Data chief economist Jim Haughey.