Construction Spending Shows a Year-Over-Year Increase

The National Association of Home Builders monitors the construction industry so it can be the first to report both positive and negative news to the real estate industry and if necessary, to Congress.  Since the housing industry is one of the leaders in economic growth and development in the United States, and the national economy depends on real estate for a good portion of the GDP, the health of the real estate industry if of prime importance to those vendors, contractors, and builders who are involved in its day-to-day production.

To that end, construction spending was reported by the National Association of Home Builders (NAHB) to have grown in November, 2015.  Private residential construction which includes homeowner improvements, DIY remodeling and renovations, and other types of repairs saw an increase in construction spending of 5.9% from November, 2014.  Single-family construction spending was up 9% over the same period and multi-family construction spending was up 12%.
From November, 2015, to December, 2015, private residential construction spending increased by .12%.  Single-family home construction spending increased to $231 billion which is a 1% increase from November.  Multi-family spending increased to $53 billion – a 2.66% increase.  Interestingly, if multi-family spending levels off to a steadier pace, which it is predicted to do in 2016, the trend in real estate suggests that single-family home construction will begin to increase.

In the commercial sector, an increase of 45% in the manufacturing-related construction from December, 2014, to December, 2015, drove an overall increase of 8% year-over-year in commercial construction spending.

Since the Great Recession, the real estate industry has been on a continuous climb of recovery once the housing market started to turn around.  The numbers at the end of 2015 reflect this slow but steady progress for builders, contractors, remodelers, and renovators, as well as all of the construction employees involved in projects nationwide.

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