AWI e-briefs - 07/15/2010 (Plain Text Version)
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Multifamily Construction Continued Decline, but Growth Is Ahead
While multifamily construction spending still continues to decline, the good news is that single-family construction is advancing slowly.
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The combination of the now expired home buyer tax credit, historically low interest rates and the improving employment picture has propelled single-family construction forward over the past 12 months as measured by the value of construction put in place, according to the National Association of Home Builders (NAHB).
Although the value of single-family construction only rose 0.8% at a seasonally adjusted annual rate in May, it was still up 32.1% from a year earlier — when construction activity was at an extremely low level, NAHB reported.
Unfortunately, the slowdown in multifamily construction spending continued in May, falling 6.3% from April and plummeting 57.7% from a year earlier, reflecting the cumulative effects of the lack of financing for new projects and the gradual tapering off of multifamily construction starts since fall 2009.
May starts and permit numbers were up and if that improvement continues, the NAHB predicts that the value of multifamily construction put in place will be on an upward trajectory in the next few months.