February & March Construction Stats a Mixed Bag
Year over year stats look promising, but month-to-month dips raise concerns.
If you are involved in construction lending, you are no doubt tracking all kinds of stats in an effort to gauge the health of the industry and your opportunities for profit. Unfortunately, sometimes trends seem to contradict one another and it can be tough to determine which to follow. Here are some examples taken from what’s been going on year-over-year and month-to-month in the industry of late.
Construction Spending
Construction spending for February 2015 was estimated at a seasonally adjusted rate of $967.2 billion, which represents an increase of 2.1 percent over February of 2014. Private construction led the industry with $698.2 billion in spending, while the public sector accounted for $268.9 billion.
Construction Employment
Between March 2014 and March 2015, 41 states plus Washington DC added construction jobs. California, Texas, and Florida added the most with 46,300 jobs 39,300 jobs, and 37,400 jobs added respectively. However, between February 2015 and March 2015, 29 states lost construction jobs. Of the year-over-year leaders, only Texas lost jobs with 0.9 percent of construction employment lost. Experts hope that federal plans to improve aging infrastructure will soon be approved and help keep the industry moving past this soft spot.
Private Housing
Privately owned housing starts for March 2015 increased 2.9 percent over March of last year, but dipped 5.7 percent below the revised February rate. Privately owned housing completions dropped year over year and month to month, with a 5.8 percent decrease compared to last year and a 3.9 percent decrease compared to last month.
One bright spot in the housing market was that the rate of new home purchases in February increased 7.8 percent over the previous month and 24.8 percent over last year. This represents the strongest pace of annual growth since 2008.
Homeowner equity is also continuing on an upward trend, with nearly $5.1 trillion in value gained since April 1, 2009.
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There is always going to be a certain amount of volatility in the building and construction lending industries. While you can’t control the policies of the Fed or the public works programs sponsored by the government, you can control your own costs. One excellent way to ensure that your portfolio is always ready to adjust to changing market conditions as efficiently as possible is to invest in online fund control software from ECL Software. Our software suite includes many time- and money-saving features to help reduce everyday overhead costs, as well as a robust stress-testing feature to allow you to plan out a response to every possible market shift.
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