NAHB analysis of Census Construction Spending data shows that total private residential construction spending for April dropped to a seasonally adjusted annual rate of $439.7 billion, down by 1.5% over the March upwardly revised estimate. Private nonresidential construction spending was also down 1.5%, the first decline in 2016.
Within private residential construction, spending on multifamily and improvements both declined in April. Multifamily spending decreased to $60.0 billion after two consecutive months of strong gains. Despite this monthly decline, multifamily spending was 21.4% higher than in April 2015. Private construction spending on home improvements fell to a seasonally adjusted annual rate of $142.2 billion, down by 3.2% since last month. Compared to 2015 April estimates, spending on home improvements decreased 3.5%. Single-family spending stood at $237.5 billion, virtually unchanged since March but up by 12.9% year over year.
The NAHB construction spending index, which is shown in the graph below (the base is January 2000), illustrates the strong growth in new multifamily construction since 2010, while new single-family construction and home improvements spending have drifted upward at a more modest pace. NAHB anticipates accelerating growth for new single-family spending over the rest of 2016.
The pace of private nonresidential construction spending retreated after three consecutive monthly increases. It fell 1.5% on a monthly basis, but was 3.4% higher than the April 2015 estimate. The largest contribution to this year-over-year nonresidential spending gain was made by the class of lodging (25.3% increase), followed by office (24.4% increase) and amusement and recreation religious (11.9% increase).