NAHB analysis of the most recent Census Construction Spending data shows that total private residential construction spending stood at a seasonally adjusted annual rate (SAAR) of $507.2 billion in June. It was down 0.5% after being virtually flat in May and rising 0.9% in April. On a year-on-year basis, total private construction spending was down 8.1%.

The monthly declines are largely attributed to the slowdown of single-family construction and improvement spending. Spending on single-family construction fell 0.7% in June to a seasonally adjusted annual rate of $263.6 billion, following a decrease of 1.0% in May and being unchanged in April. Home improvement spending slipped 0.5% in June after a modest 0.7% increase in May and a 3% rise in April. Multifamily construction spending inched up 0.2% in June to a $66.2 billion pace, reaching a record high. It was 11.5% higher than a year ago.

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. Improvement and single-family construction showed weakness over the last year.

Private nonresidential construction spending declined 0.3% on a monthly basis. It has declined for three straight months, and was 0.4% lower than a year ago. The largest contribution to this year-over-year nonresidential spending decline was made by the class of commercial, followed by power plants and education.