At a seasonally adjusted annual rate of $490.2 billion, new construction starts in August advanced two percent relative to July, according to McGraw Hill Construction, a division of McGraw Hill Financial.
Residential building stayed on the upward track, while nonresidential building retreated from its improved July amount, continuing the up-and-down pattern that’s been present during 2013. For the first eight months of 2013, total construction starts on an unadjusted basis came in at $329.4 billion, up one percent from the same period a year ago. If electric utilities are excluded from the year-to-date statistics, total construction starts in the first eight months of 2013 would be up 10 percent.
The August data lifted the Dodge Index to 104 (2000=100), compared to a revised 102 for July. So far during 2013, the Dodge Index has hovered within the range of 98 to 106, after averaging 103 for the full year 2012.
“On balance, the construction industry is showing modest growth in 2013, although, by major sector, there’s been divergent behavior,” says Robert A. Murray, vice president of economic affairs for McGraw Hill Construction. “Housing continues to lead the way, with consistent gains reported for both single- and multifamily-housing.”
Residential building in August increased four percent to $214.1 billion (annual rate). Single-family housing grew two percent, maintaining the steady growth that’s been present during 2013. While the month-to-month increases have been smaller than last year, the consistent gains have enabled the pace for single-family housing in August to be 11 percent higher than the start of this year, and 30 percent higher than the average monthly pace reported during 2012. By geography, single-family housing in August revealed this pattern – the Midwest was up four percent; the South Atlantic and Northeast were each up three percent; the West was up two percent; and the South Central was down one percent.
Nonresidential building in August dropped eight percent to $148.9 billion (annual rate), falling back after a nine percent gain in July. Much of the downturn came from the institutional categories, which fell a combined 16 percent.
By geography, total construction starts in the January-August period of 2013 showed gains in four regions: the Northeast (+ nine percent); the West (+ six percent); the South Central (+ four percent); and the Midwest (+ two percent) The South Atlantic was the one major region to report a year-to-date decline, falling 13 percent.