Multifamily construction spending weakens

296
new residential construction multifamily construction

The Census Bureau’s report on construction spending said that the value of multifamily residential construction put in place in October was down 0.2 percent from the revised level of the month before. Spending on single-family residential construction was reported to rise 1.1 percent while spending on improvements was up 2.0 percent.

The value of total private residential construction put in place in October 2023 was reported to be $884.4 billion on a seasonally adjusted, annualized basis. This figure, which includes spending on both new construction and on improvements, was reported to be up $10.8 billion month-over-month. This is on top of a $1.6 billion upward revision to September’s figure. However, residential construction spending in October was reported to be down 0.7 percent year-over-year.

Multifamily construction spending off its high

The value of new private construction of multifamily residential buildings put in place in October was reported to be $135.6 billion on a seasonally adjusted, annualized basis. This was down $235 million from the revised level for September. However, the September figure was revised higher by $187 million, so the preliminary multifamily construction spending figure reported this month is only $48 million, or 0.04 percent, lower than the preliminary figure for September reported last month. The value of multifamily housing construction put in place in October 2023 was 16.7 percent higher than the level of October 2022.

By comparison, the Census Bureau’s New Residential Construction report said the number of unit completions in October in buildings with 5 or more units fell 12.6 percent. However, completions were 14.3 percent higher than their year-earlier level.

Governments were reported to have put $10.7 billion in residential construction in place in October on a seasonally adjusted annualized basis.

The value of new single-family residential construction put in place in October was $408.7 billion on a seasonally adjusted, annualized basis. This was up $4.4 billion from the revised (+$2.0 billion) level for September but was down 1.4 percent from the level of October 2022.

The value of improvements to residential buildings put in place in October was reported to be $340.1 billion on a seasonally adjusted, annualized basis. This was up $6.6 billion from the revised (-$622 million) level for September but was down $7.0 billion from the year-earlier level. The Census Bureau does not separate out improvements for single-family and multifamily residential buildings.

Charting the data

The following chart shows the value of residential construction put in place each month since January 2012. The chart illustrates that the reported value of new multifamily residential construction put in place has started to decline after being on an upward trend since July 2022. The value of new single-family residential construction put in place has been trending higher since April 2023. The value of improvements to residential buildings put in place peaked in May 2022 and has been occupying a narrow range for the last year.

residential construction spending with multifamily construction spending

The report from the Census Bureau also includes information on spending on other types of construction projects. The full report can be found here.