According to the most recent report from the Census Bureau, which was released This Week in Real Estate, the dollar value of new construction spending is 7.6% higher than the same time period last year at $1.31 trillion. Below are a few highlights from the last week of May that influence our business:
* ShowingTime: High Consumer Demand Continues to Propel Showing Activity to Near-Record Levels.Showing activity across the U.S. increased 4.6 percent year-over-year in April, according to the ShowingTime Showing Index, as buyer demand continues to rise throughout most of the country.The South region experienced the highest regional year-over-year increase for the second consecutive month, jumping 9.3 percent, while the Northeast (4.9 percent) and Midwest (4 percent) regions also saw a rise in showing activity. Activity in the West region dropped 8.3 percent compared to April 2017, marking the region’s third consecutive year-over-year monthly decrease. ShowingTime Chief Analytics Officer Daniil Cherkasskiy says the near-record level of showing activity across the country indicates high consumer demand remains despite rising home prices. “Overall, we continue to see record levels of activity across the U.S.,” says Cherkasskiy. “Showing activity only declined in the West region, while other regions throughout the country have consistently experienced increased demand.”
* Residential and Private Construction Numbers Solid in April. April turned out to be a solid month for construction. The Census Bureau said that dollar value of new construction activity on residential, non-residential, and public projects was at a seasonally adjusted and annual total of $1.31 trillion. This represented a 1.8 percent increase from March’s total of 1.29 trillion and was 7.6 percent higher than the $1.22 trillion rate in April 2017. Privately funded construction was at a seasonally adjusted annual rate of $1.01 trillion, a 2.8 percent gain from March, and up 7.6 percent from the previous April. Through the end of April private construction totaled $305.27 billion, a 6.3 percent increase. Residential spending is the largest component of private construction. Spending there was up 4.5 percent from March to a seasonally adjusted annual rate of $556.30 billion, 9.5 percent higher than spending in April 2017. Single-family construction was at a rate of $285.70 billion, unchanged from March but up 9.6 percent year-over-year. Multifamily construction spending rose 3.6 percent for the month but was 4.0 lower than a year earlier. Public construction spending slowed by 1.3 percent from March at $296.12 billion but was 7.7 percent higher year-over-year. The residential component was down 0.2 percent to an annual rate of $7.14 billion but is 26.4 percent greater than last year. That spending is also 7.5 percent higher across the first four months of 2018.
* Homeowners Who Remodel Will Spend an Estimated $7,893 Per Home in 2018. In the average zip code, owners who improve their homes in 2018 will spend $7,893 per home; but, as you would expect in a country as large as the U.S., there is considerable variation. There are many zip code areas where spending per improved home is under $5,5000, and many where it is over $11,000. Zip codes with high spending per improved home tend to cluster around large metro areas—especially in the Northeast. At the very top are 17 zip codes where estimated spending per improved home is over $18,000. Ten of these are in the New York-Newark-Jersey City Metropolitan Statistical Area, two are in Fairfield County, Connecticut; and one is in a suburb of Boston. Of the remaining four, two are zip codes on Lake Michigan in Cook County north of Chicago, and two are close-in suburbs of San Francisco.