Housing could be in for a slowdown as three indicators of new- and existing-home construction activity fell year-over-year for the first time since 2011, according to BuildFax.
"More so now than in years prior, the compounding effects of
New single-family housing construction authorizations fell 0.86% in November from one year prior and by 0.58% from October, the BuildFax Housing Health Report said. A bright spot, however, is that the trailing three-month outlook for September to November is up 3.68% over the previous year, because of September's growth, the company added.
Maintenance volume fell by 5.85% when compared with November 2017, when the maintenance spend fell by 15.39%.
Remodeling, which is a subset of the maintenance data that includes renovations, additions and alterations, saw a 12% volume decline and a 1.15% spending decline from the previous year.
There were 10 occasions in the past decade where single-family housing authorizations, maintenance and remodels all declined year-over-year, with eight of those taking place during 2008 and 2009 at the height of the Great Recession, BuildFax said.
New commercial construction volume fell 0.87% from November 2017, while maintenance activity fell 1.5% and remodeling fell 4.28%.
But the drop in commercial activity may be more indicative of a labor shortage. Between 2013 and 2018, new construction activity rose 28.42% and maintenance was up 22.21%.
Factor in that new construction costs over that period rose 68.83%, the disproportional increase when compared with activity points to a labor shortage that caused the year-over-year decline, BuildFax said.