Construction starts in South Florida fall almost 40% in June

Rising construction costs are making it more expensive to build new projects

TRD MIAMI /
Jul.July 29, 2019 11:30 AM
Construction of a new home (Credit: iStock)

Construction of a new home (Credit: iStock)

Construction starts in South Florida fell significantly in June amid continued signs that the commercial and residential real estate markets are slowing down after years of rapid growth on a national and local level.

Total construction starts declined 39 percent on a yearly basis in South Florida to $1.01 billion, according to Dodge Data and Analytics.

Construction of nonresidential properties fell to $400.4 million from the previous year, a drop of about 38 percent. Meanwhile residential construction fell even further, declining to $613.5 million, a decrease of 40 percent.

The data shows that developers could be holding off on building new projects in South Florida because of the rising costs of construction such as supplies and labor. Land prices in South Florida have also risen drastically, making it more costly to build and more difficult for investors to achieve the returns they’ve gotten in the past.

Another recent report by BuildFax signals that new home construction is slowing due to these rising costs. Single-family housing permit authorizations nationally decreased by 2.75 percent in June, year-over-year, according to the report by BuildFax.

Federal Reserve Chair Jerome Powell even made this point in July and suggested that Trump’s tariff and immigration policies are making homebuilding too expensive.

Dodge Data defines nonresidential as office, retail, hotels, warehouses, manufacturing, educational, healthcare, religious, government, recreational and other buildings. Residential includes single-family and multifamily housing.


Related Articles

arrow_forward_ios
One Ocean

Allegations of shoddy construction pile up at Related’s One Ocean

Daily Digest Miami

Heir to Merck pharma fortune sells Palm Beach estate, Brookdale buys back Sawgrass Park portfolio for $80M: Daily digest

Daily Digest Miami

Ben Carson talks Opportunity Zones, top developers riff on condos vs. rentals: Daily digest

From left: Amir Korangy and Secretary of Housing and Urban Development Dr. Ben Carson

Ben Carson on Opportunity Zones, unity and red and black ants: TRD Miami Showcase & Forum

Arden home community and Stuart Miller

Lennar picks up 50 lots in western Palm Beach County

Miami beach (Credit: iStock)

Hurricane Dorian spared South Florida but will still cost developers and contractors

A satellite image of Hurricane Dorian (Credit: Getty Images, iStock)

As Hurricane Dorian barrels toward South Florida, developers and builders prepare

New homes in Florida (Credit: iStock)

Tariffs, natural disasters are driving up construction costs in Florida: report

arrow_forward_ios
Loading...