Home sales did decrease in February, according to the Commerce Department, but the improvement in construction may be an early sign that the market is recovering. Housing construction rates, particularly for single-family homes, have been low since the recession as Americans found supply heavy and many were unable or unwilling to spend at previous levels.
Apartment construction increased in some markets as the demand for rental housing grew, but has been slow to rise in some cases. This presents an opportunity for investors and rental managers who are up to the task to hold single-family homes.
Spending on private residential projects spiked 10.2 percent above 2011 levels, with total construction about 6 percent higher than the year before, despite a slight drop from January. The seasonally-adjusted annual rate of residential construction spending was approximately $253.5 billion, the Census Bureau reported. This represents a major improvement over 2011, although it is low compared to the March 2006 peak of $682.6 billion.