The Census Bureau today released Construction Spending for June 2010.
Residential construction spending includes remodeling, additions, and major replacements to owner occupied properties subsequent to completion of original building. It includes construction of additional housing units in existing residential structures, finishing of basements and attics, modernization of kitchens, bathrooms, etc. Also included are improvements outside of residential structures, such as the addition of swimming pools and garages, and replacement of major equipment items such as water heaters, furnaces and central air-conditioners. Maintenance and repair work is not included.
This report covers a broad spectrum of residential construction spending but does not provide countable data on how much new home building occured in the previous month. Furthermore, Construction Spending data is one of the last backward looking economic indicators to be released on a monthly basis. This means the market has already been given multiple opportunities to react to more timely information.
For example, ahead of this release we had already learned that New Home Sales Rebounded from Revised Record Low in June, we had already heard that Existing Home Inventory Moved Higher, and we already knew Housing Starts Went Stagnate. On top of that, Home Builders Were Less Confident in June. These headlines are not the building blocks for a strong structural recovery in housing. So it was no surprise when the Census Department today told us private residential construction declined further in June...
Residential construction was at a seasonally adjusted annual rate of $258.3 billion, 0.8% below the revised May estimate of $260.3 billion. Private Residential Construction continues to hover near a record low level....same old story!
Below is a recap of the entire report. Overall construction spending, which includes private and public spending, rose 0.1% thanks to a 4.6% increase in Federal spending. The private sector declined across the board, not including an unchanged month over month read in Lodging.