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The Week Ahead: Could Single-Family Construction Continue to Rise?

On Monday, the United States Census Bureau will release its Construction Spending study for February 2017. The report will cover all areas of construction, including single-family residential.

The previous study, for January 2017, revealed an increase in single-family construction, both month-over-month and year-over-year. Between January 2017 and December 2016, single family construction grew by 1.1 percent, and between January 2017 and January 2016, construction grew 2.3 percent.

According to the Census Bureau, Residential construction has been on the rise every month since last year. Residential construction saw its greatest month-over-month leap in 2016 between October and November 2016, when total construction value jumped from $466 billion to $477 billion.

Jumps in new home construction are partly influenced by the decreasing existing home inventory. The A report from Redfin earlier this month showed that home sales, constrained by a lack of supply, increased just 1.8 percent over the last year. February saw a 6.4 percent decline in new listings and a 12.9 percent decline in the overall number of homes for sale, marking the third month in a row that inventory has fallen by double-digits and the 17th consecutive month of year-over-year supply declines.

However, single family building permits grew 3 percent between January and February, which was reflected in the construction job market. An Eye On Housing blog post from the National Association of Homebuilders (NAHB) reports that, according to the BLS Job Opening and Labor Turnover Survey (JOLTS) and NAHB analysis, there were 147,000 open construction sector jobs in January. The open position rate (job openings as a percent of total employment) was 2.1 percent.

This Week’s Schedule

Mortgage Bankers’ Association Mortgage Applications, Wednesday 7 a.m. EST

Freddie Mac Weekly Mortgage Survey, Thursday, 10 a.m. EST

Federal Reserve Consumer Credit Survey, Friday at 3 p.m. EST

About Author: Seth Welborn

Seth Welborn is a Harding University graduate with a degree in English and a minor in writing. He is a contributing writer for MReport. An East Texas Native, he has studied abroad in Athens, Greece and works part-time as a photographer.
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