According to the Bureau of Economic Analysis’s final estimate, the nation’s gross domestic product rose by 2.5% on a seasonally adjusted annual rate basis in the fourth quarter of 2017. On the same basis, housing’s share of the GDP rose slightly to 15.4%, while the home building and remodeling component of the GDP, also known as residential fixed investment, rose to 3.5%.
RFI covers the contribution of remodeling, home building, and residential remodeling, as well as brokers’ fees, to the GDP. RFI makes up 3.5% of the economy, or $605 billion on a seasonally adjusted annual basis (based on inflation-adjusted 2009 dollars.)
Housing services, the other component of housing’s impact on the GDP, includes rents, imputed rents, and utilities. This makes up 11.9% of the economy, or $2.06 trillion on a seasonally adjusted annual basis.
Historically, RFI has averaged roughly 5% of GDP while housing services have averaged between 12% and 13%, for a combined 17% to 18% of GDP. These shares tend to vary over the business cycle.
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