Construction spending inched down by 0.1 percent from July to August as a downturn in single- and multifamily residential building outweighed selective gains in nonresidential projects, according to an analysis of a new government report that the Associated General Contractors of America released today. Association officials said the slight decline reflects the fact that many federally funded construction projects have yet to begin and investment on housing slows amid a glut in newly completed buildings.
“Although the federal government has announced thousands of project awards in the past three years, most of the money has yet to turn into construction contracts, let alone work under way,” said Ken Simonson, the association’s chief economist. “There is still great potential for infrastructure and power projects, but the timing remains uncertain. Meanwhile, single-family homebuilding should pick up as mortgage rates decline, but multifamily construction is likely to shrink until the current glut of apartments is absorbed.”
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