The Associated General Contractors of America (AGC) reported today that says, in a nutshell, that construction spending was strong for 2015 but tailed off towards the end of the year. Construction spending in December was measured at $1.117 trillion seasonally adjusted annual rate (SAAR), which was 8.2% higher than the rate measured in December 2014. However, the rate was only 0.1% higher than November, which was already revised downward. What does this all mean? The construction market has been fairly brisk throughout 2015, but what remains to be seen is whether the industry is now just catching its breath or if it's completely winded.
Focusing on the bright spot, the multi-family sector of the industry is strong, as I mentioned nine days ago.Multi-family defied the December slowdown and jumped 2.7% last month and was up 12% year-over-year. Compare this to the single-family market, which was up 1% in December and 8.7% since 2014. It will be interesting to see how this growth plays out in the future and I plan on looking into it deeper.
The rate of spending for private non-residential construction fell 2.1% from November 2015 to December 2015 but was up 11.8% from a year previous. Public construction was up 1.9% in December 2015 from the previous month and up 3.9% from a year ago. Public construction has been fairly stagnant for a few years.