A continued downturn in residential spending saw total construction spending decline 0.7% month-over-month in August (consensus -0.2%) following a downwardly revised 0.6% decline (from -0.4%) in July.
That is an offshoot of rising interest rates that have weakened homebuilder sentiment, as higher mortgage rates have also worsened affordability for prospective buyers. Total private construction was down 0.6% month-over-month while total public construction was down 0.8%. On a year-over-year basis, total construction spending was up 8.5%.
August 2022 Total Construction Spending Highlights
- Total construction spending declined 0.7% month-over-month in August (consensus 0.3%) following a downwardly revised 0.6% decline (from -0.4%) in July.
- Total private construction -0.6%. Year on year +9.9%
- Total public construction -0.8%. Year on year +3.3%
- During the 1st 8 months of the year construction spending has risen 10.9% which is 1% above the same period in 2021
- Total residential spending fell 1.0% month-over-month and was up 12.4% year-over-year.
- Total nonresidential spending decreased 0.4% and was up 4.7% year-over-year.
- The decrease in private construction spending was paced by a 0.9% decline in residential spending, led by a 2.9% decline in new single-family construction.
- Nonresidential private spending decreased 0.1%, led by a 0.9% drop in power spending.
- The decrease in public construction was driven by a 0.8% decrease in nonresidential spending, which was led by a 1.4% decline in highway and street spending. Public residential construction spending dropped 2.7%.
From The TradersCommunity News Desk