It’s gift-giving season, and the Federal Reserve may be getting a present from the property game.
The Fed’s economic wish list weighs heavily on cheap money fueling a real estate revival. It’s a bet that extra construction projects and the spending and jobs such endeavors create will enliven a lethargic recovery in the broader economy.
Well, dollars tossed at construction may finally be on the upswing.
Analysis of October’s construction spending patterns by the Associated General Contractors of America found ongoing building expenditures running at a $872 billion annual rate. That’s up 9.6 percent in a year — and the highest level of activity in 37 months.
Residential efforts ran especially strong: New single-family construction hit its highest mark since November 2008; multifamily construction hit a three-year high; and home improvements ran at a five-year high.
Widespread gains in spending in October, along with hefty upward revisions to estimates for the previous two months, show that construction has finally come out of its long slump, said Ken Simonson, AGCA’s chief economist.