Real Estate

April’s construction spending drops 1.2% from last year

Residential construction spending falls 0.6% from the previous month

The U.S. Census Bureau announced that construction spending during April 2019 was estimated at a seasonally adjusted annual rate of $1.3 trillion.

Although April’s rate is nearly the same as March’s, the organization indicated April’s spending is 1.2% below the April 2018 estimate of $1,314.7 billion.

Additionally, spending on private construction was at a seasonally adjusted annual rate of $954 billion, 1.7% below the revised March estimate of $970.4 billion.

Of that, residential construction spending was at a seasonally adjusted annual rate of $499.3 billion in April, which is 0.6% below the revised March estimate of $502.4 billion.

April’s Housing Market Index revealed that although homebuilders were optimistic about the market, labor shortages remained a prominent concern.

In fact, while the index measuring current sales conditions rose to 69 points, expectations for the next six months fell to 71.

“Ongoing job growth, favorable demographics and a low-interest rate environment will help to modestly spark sales growth in the near term,” NAHB Chief Economist Robert Dietz said. “However, supply-side headwinds that are putting upward pressure on housing costs will limit more robust growth in the housing market.”

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