Private sector construction spending on single-family homes jumped a seasonally adjusted 5.1 percent in November compared with October, bringing the year-over-year gain to 18.1 percent.
Spending on single-family home construction in November hit a seasonally adjusted $341.5 billion, according to data released by the Census Bureau Monday. Private sector apartment construction was more or less unchanged at $90 billion.
For the first 11 months of the year, private residential spending rose 6.2 percent in single family construction spending and a 5.0 percent in multifamily construction.
Including home improvements, private sector construction spending rose to $658 billion, a 2.7 percent monthly gain and a 16.1 percent gain from the year-ago level. On a year-to-date basis, this is up 10.2 percent, an indication that Americans have poured lots of investment into their existing homes this year.
The gains indicate the ongoing strength in the market for houses in the U.S. despite the unprecedented economic dislocations caused by the pandemic and efforts to stem the spread of the coronavirus.
Total residential spending, which includes spending by governments on homes, rose 2.6 percent from the month earlier to a seasonally adjusted $667 billion and is up 16.2 percent from a year ago. Government spending on residential construction, a small part of overall homebuilding, rose half a percentage point to $8.9 billion. But spending is up a tremendous 24.3 percent compared with the pre-pandemic year-ago level.
While residential construction boomed in 2020, nonresidential construction has withered. Private nonresidential construction is down 9.5 percent compared with a year ago and fell 0.8 percent in November to a seasonally adjusted $453.8 billion. Public nonresidential construction has somewhat offset this decline: it is up 2.6 percent compared with a year ago, to $338.7 billion, despite a month-over-month decline of 0.2 percent in November.
The effects of the pandemic can be seen in the details of the nonresidential private sector spending decline. Private sector spending on hotels and motels fell 8.1 percent on a seasonally adjusted basis in November and is down 26.4 percent compared with the month a year ago. Year to date it is down 13.6 percent year-to-date. Spending on office construction is down 6.6 percent compared with a year ago, although this picked up 0.3 percent in November. Year-to-date it is down 4.3 percent. Manufacturing construction spending ticked up a tenth of point in November compared with October but is down 15.1 percent compared with last November. Year to date it is down 9.2 percent.
Overall construction spending rose 0.9 percent in November, roughly in-line with analyst expectations, for an annual gain of 3.8 percent. Total private-sector construction rose 1.2 percent for the month and is up 3.8 percent annually. Total government construction fell 0.2 percent on a monthly basis and is up 3.1 percent compared with November 2019.
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