Housing demand sent construction spending up in August

Money flowing into construction is up $37.8B year-to-date compared to 2019

National /
Oct.October 01, 2020 11:34 AM
US construction spending is up $37.8 billion year-to-date compared to 2019 (iStock)

US construction spending is up $37.8 billion year-to-date compared to 2019 (iStock)

Spending on construction, particularly in the housing sector, plowed ahead in August.

Money flowing into construction projects ticked up to $1.4 trillion seasonally adjusted last month, a year-over-year increase of 2.5 percent, according to the Census Bureau’s monthly report on construction work done on new and existing structures across public and private sectors.

In the first eight months of 2020, $927.7 billion had been spent on construction, compared to $889.9 billion in 2019, according to the report, which has been surveying construction spending monthly since 1964. Construction spending in 2020 has outpaced the same period last year by about $37.8 billion.

In August, private homebuilders were once again responsible for the majority of construction costs.

Residential construction contributed $589.4 billion seasonally adjusted, or 42 percent, of the total monthly spend. Private nonresidential construction made up 33 percent, while public spending accounted for the remaining quarter. A majority of the public sector projects were either educational structures or highways.

August’s report echoes the prior month: In July, construction spending totaled $1,364 trillion, seasonally adjusted. Of that, homebuilders accounted for more than half of the month’s spending with about $547 billion spent on residential projects.

National supply of available homes for sale hit a 40-year low last month as continued demand from homebuyers, fueled by low mortgage rates, pushed prices to all-time highs.

Homebuilders have responded to demand by ramping up production, including for new single-family homes destined to be rented out.

There were 1.2 million homes completed in August while housing starts hit 1.4 million — both figures are seasonally adjusted. The demand to build new housing drove up lumber prices over the summer.





    Related Articles

    arrow_forward_ios
    Interactive Map of Projects Planned Under Gowanus Rezoning
    Here they come: Map shows projects planned in rezoned Gowanus
    Here they come: Map shows projects planned in rezoned Gowanus
    The upstate land grab behind the solar power boom
    The upstate land grab behind the solar power boom
    The upstate land grab behind the solar power boom
    New York Governor Kathy Hochul touring construction in the subway (Getty)
    Hochul promises Second Avenue Subway work to advance in 2022
    Hochul promises Second Avenue Subway work to advance in 2022
    Children’s Magical Garden at at 157 Norfolk Street (Google Maps, Facebook)
    Children’s Magical Garden claps back against developer who claimed defamation
    Children’s Magical Garden claps back against developer who claimed defamation
    312 West 43rd Street, National Real Estate Advisors CEO Jeffrey Kanne and Taconic Partners' Paul Pariser and Charles Bendit (Google Maps, National Real Estate Advisors, Taconic Partners)
    Taconic JV lands $204M loan for Hell’s Kitchen luxury rental
    Taconic JV lands $204M loan for Hell’s Kitchen luxury rental
    Now streaming: TRD’s podcast Deconstruct on what’s next for Surfside
    Now streaming: TRD’s podcast Deconstruct on what’s next for Surfside
    Now streaming: TRD’s podcast Deconstruct on what’s next for Surfside
    Slate Property Group principal Martin Nussbaum and 210 Clarkson Avenue (Slate, RIPCO)
    K2 Real Estate nabs $68M to kick off Prospect-Lefferts Gardens resi project
    K2 Real Estate nabs $68M to kick off Prospect-Lefferts Gardens resi project
    Feil Organization plans 43-story DoBro tower
    Feil Organization plans 43-story DoBro tower
    Feil Organization plans 43-story DoBro tower
    arrow_forward_ios

    The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

    Loading...