The latest Census estimate of total private residential construction spending is 7.5% higher than one year ago. In particular, the release shows significant improvement in construction spending for the single-family and multifamily categories. From May 2013, on a 3-month moving average basis, single-family construction spending increased by 12.3% and multifamily construction spending increased by 33.0%. The current seasonally adjusted annual rate for total private residential construction spending is $354.8 billion.
The current reading, however, is 1.5% lower than the revised April estimate. The three components of residential construction all fell in May. The home improvements category fell 1.9%, single-family spending fell 1.4%, and multifamily spending fell 0.6%.
The month-over-month decline in May should be considered along with the growth from last year. If builder sentiment is a guide for future construction spending, cautious optimism is in order. The NAHB/Wells Fargo Housing Market Index for June rose four points to 49.