New-construction starts in October advanced 13 percent, according to Dodge Data & Analytics. The increase follows the lackluster performance for construction starts during August and September, when activity fell to the lowest levels reported so far in 2015.
Much of October’s gain for total construction was due to a sharp rebound by non-residential building, with additional support coming from a moderate upturn for housing as the result of further strengthening by multifamily housing.
“The healthy increase for construction starts in October alleviates concern about a stalling expansion that may have arisen with the sluggish activity in August and September,” Dodge Data & Analytics chief economist Robert A. Murray said in a statement. “The construction start statistics do show volatility on a month-to-month basis, and as a result trends in the near term are rarely smooth. On balance, though, factors within the economic and political environment still point towards the continued expansion for construction. For the nonresidential building market, the primary drivers for its commercial and institutional building segments remain positive. The U.S. economy continues to register moderate job growth, vacancy rates are receding, rents are rising, and construction-related bond measures at the state level are getting passed.
“For residential building, multifamily housing is still a target for investors while Millennials are lifting the demand for apartments. For public works, there’s been solid progress made by Congress towards finalizing the next federal multiyear transportation bill and there’s less uncertainty with the selection of Paul Ryan as the new Speaker of the House of Representatives, although fiscal 2016 appropriations still need to be passed.”