New construction starts moved 5 percent lower in September to a seasonally adjusted annual rate of $774.1 billion, according to Dodge Data & Analytics. This marks the second consecutive monthly decline in construction starts. By major sector, nonbuilding construction fell 13 percent in September, while residential construction dropped 6 percent. On the plus side, nonresidential construction starts rose 1 percent during the month,
The September statistics pushed the Dodge Index lower to 164 (2000=100) compared to 173 in August, marking the lowest reading since May. Despite the month’s decline, the Index remains close to its 2019 average of 167.
Through the first nine months of 2019, total construction starts were 3 percent lower than 2018 due to pullbacks in both residential and nonresidential construction starts. However, nonbuilding construction starts are 4 percent higher year-to-date as a result of strong gains in electric utilities/gas plants.
Nonresidential building starts inched 1 percent higher in September to $287 billion (at a seasonally adjusted annual rate). The increase was a result of a 243 percent increase in manufacturing construction due to the start of a large automotive plant. Commercial construction starts fell 14 percent over the month as the office sector pulled back from a very strong level of activity during the prior month. Institutional construction starts fell 1 percent.
Year-to-date through September, nonresidential building starts totaled $215 billion, a 4 percent decline from the first nine months of 2018. Commercial starts were 6 percent higher pushed forward by the office, warehouse, and parking categories. Institutional construction starts were down 3 percent through nine months, with all major categories posting setbacks. Manufacturing starts were a sharp 39 percent lower year-to-date.
Residential building fell 6 percent in September to $300 billion at a seasonally adjusted annual rate. Both single-family and multifamily starts fell 6 percent from August to September.
Through the first nine months of the year, residential construction starts were 6 percent lower than in the same period of 2018 at $238.3 billion. Single-family starts were down 4 percent, while multifamily declined 11 percent year-to-date.
