Private residential construction spending increased 1.1% in December 2021 and was 15.0% higher than December 2020, according to an NAHB analysis of Census Construction Spending data. The gains are attributed to strong growth of spending in both single-family and multifamily construction.
Single-family construction spending increased to a $435 billion annual pace in December, up by 2.1% over the upwardly revised November estimates. Multifamily construction spending rose 0.4% in December. Spending on improvements slipped 0.1% in December, after a dip of 0.8% in November. Home building is still facing supply chain issues, which means the industry is dealing with rising material costs as well as ongoing labor shortages.
The NAHB construction spending index illustrates the solid growth in single-family construction and home improvement from the second half of 2019 to February 2020, before the COVID-19 hit the U.S. economy, and the quick rebound since July 2020. New multifamily construction spending has picked up the pace after a slowdown in the second half of 2019. Under the pressure of supply-chain issues, construction spending on single-family, multifamily and improvements slipped down a bit from the third quarter of 2021.
