At a seasonally adjusted annual rate of $849.6 billion, new construction starts in July advanced 2% from the previous month, according to Dodge Data & Analytics. This marked the third consecutive monthly increase for total construction starts, following gains of 10% in May and 9% in June. By major sector, nonbuilding construction led the way in July with a 24% hike, boosted by several large public works and electric utility/gas plant projects. Nonresidential building in July settled back 4%, following a 16% jump in June that included the start of the $1.1 billion Terminal 5 expansion at Chicago’s O’Hare International Airport. Residential building in July slipped 6%, as multifamily housing retreated from its elevated June amount. Through the first seven months of 2019, total construction starts on an unadjusted basis were $459.3 billion, down 6% from the same period a year ago.
The July statistics raised the Dodge Index to 180 (2000=100), compared to 176 in June, and marked the highest level for the Dodge Index so far during 2019. The latest two months have seen the Dodge Index move above its 2018 monthly average at 172.
Residential building in July was $300.1 billion (annual rate), down 6% from June. After climbing 28% in June, multifamily housing retreated 16% in July as the current year’s moderate pullback resumed. The July pace for multifamily housing was down 15% from its average monthly rate during 2018. There were 8 multifamily projects valued each at $100 million or more that reached groundbreaking in July, compared to 14 such projects in June. The large July multifamily projects were led by the $240 million ArtHaus multifamily high-rise in Philadelphia PA, a $235 million multifamily high-rise in the Hudson Yards district of New York NY, and a $190 million multifamily high-rise in New Rochelle NY. During July the top five metropolitan areas ranked by the dollar amount of multifamily starts were – New York NY, Miami FL, Philadelphia PA, Washington DC, and Austin TX. Single family housing in July receded 2%, slipping for the second month in a row after June’s 3% decline. The July pace for single family housing was down 6% from its average monthly rate during 2018, as affordability constraints resulting from high home prices continue to outweigh the benefits of low mortgage rates. By major region, single family housing showed this performance during July versus June – the Northeast, up 4%; the South Atlantic, up 1%; the South Central, unchanged; the Midwest, down 4%; and the West, down 5%,
