In November 2019, U.S. construction spending amounted to $1.324 trillion, which is 4.1% above the previous year’s rate of $1.271 trillion, the Census Bureau said.
When compared to October 2019, construction spending was 0.6% above the revised estimate of $1.317 trillion.
Spending on private construction during November was at a seasonally adjusted annual rate of $985.5 billion, 0.4% above the revised October estimate of $981.1 billion, and 1.6% above a year ago.
Of that, residential construction spending was at a seasonally adjusted annual rate of $536.1 billion in November, which is 1.9% above the revised October estimate of $526.3 billion and up 2.7% from a year ago.
A measure of homebuilder sentiment, the Housing Market Index, revealed confidence improved in all U.S. regions during the month.
According to the National Association of Home Builders and Wells Fargo, which put out the monthly report, November’s sentiment levels came in at 70 points.
This rate marks the second-highest level in 2019 as it was 10 points above the year-ago month.
“Single-family builders are currently reporting ongoing positive conditions, spurred in part by low mortgage rates and continued job growth,” NAHB Chairman Greg Ugalde said. “In a further sign of solid demand, this is the fourth consecutive month where at least half of all builders surveyed have reported positive buyer traffic conditions.
Although sales expectations rose in November, NAHB Chief Economist Robert Dietz warns homebuilders across the country continue to struggle with affordability.
“We have seen substantial year-over-year improvement following the housing affordability crunch of late 2018, when the HMI stood at 60,” said Dietz. “However, lot shortages remain a serious problem, particularly among custom builders. Builders also continue to grapple with other affordability headwinds, including a lack of labor and regulatory constraints.”