Residential Construction Spending Turned Positive Again in November

Construction spending increased slightly in November compared to October and increased its lead year-over-year from the 7.5 percent improvement reported for October. The U.S. Census Bureau said construction put in place for all sectors in November was at a seasonally adjusted annual rate of $1.626 trillion compared to $1.619 trillion the prior month, an 0.4 percent change. Compared to November 2020, the total was up 9.3 percent.

Total spending for the year-to-date (YTD) totals $1.463 trillion. This is 7.9 percent more than was spent in the first 11 months of 2020.

Private sector spending was at an annual rate of $1.274 trillion during the month, up 0.6 percent from the October rate and 12.5 percent above spending a year earlier. On an unadjusted basis, the private sector spent $107.605 billion and for the YTD a total of $1.142 trillion. The latter number represents 12.0 percent growth over the $1.020 trillion spent during the same period in 2020.

Residential construction spending had been somewhat of a drag on overall growth for the prior several months, but improved in November. Total construction spending, a seasonally adjusted $796.308 billion, was 0.9 percent higher than annualized spending in October and up 16.3 percent year-over-year. The improvement was primarily due to new single-family home building which increased 1.2 percent to a rate of $421.048 billion, 19.4 percent higher than in November 2020. Multi-family construction slipped 0.3 percent for the month but was up 9.6 percent on an annual basis.

Non-adjusted residential spending for the month totaled $67.044 billion, $36.938 billion of which was for single-family units and $8.401 billion for construction in buildings with five or more units. The Census Bureau does not break out spending for home repairs and remodeling, but it is included in overall residential spending totals.

For the YTD, private residential spending is up 23.7 percent from the prior year at $714.317 billion. Single-family expenditures grew 34.2 percent to $377.555 billion, while the multifamily total was up 16.0 percent to $91.217 billion.

Publicly funded construction lagged both October and November 2020 totals. The annualized rate of $352.275 billion was down 0.2 percent and 0.9 percent from the earlier periods. YTD the public sector has spent $321.684 billion, down 4.3 percent from the first 11 months of 2020.

Publicly funded residential spending, a $8.991 billion rate for the month, has totaled $8.376 billion through November. This is down 1.1 percent from spending to the same point last year.