Dive Brief:
- Construction spending inched up 0.1% in December to a seasonally adjusted annual rate of $1.116 trillion, the Commerce Department reported Monday.
- December's results were 8.2% higher than December 2014, and spending for all of 2015 was 10.5% higher than spending in 2014.
- Nonresidential construction spending dipped 2.1%, while residential spending grew 0.9%. Within residential, single-family home construction rose 1.0%, and multifamily increased 2.7%.
Dive Insight:
December's results failed to meet expectations, as economists surveyed by MarketWatch had predicted spending would rise 0.6%. On the positive side, 2015's total construction spending reached its highest level in eight years, according to the Associated Press.
The strength in the residential sector buoys growing optimism in the housing market, as the majority of residential reports released last month signaled improving conditions in the market.
Last month, the Commerce Department reported construction spending slipped 0.4% in November to a seasonally adjusted annual rate of $1.12 trillion — the first decline since June 2014.
Before November's slip, construction spending had been steadily increasing for 11 straight months. Despite the fact that construction spending in the past few months hasn't reached expectations, industry experts have expressed they are mostly optimistic about the year ahead.
