New construction starts in February showed little change from January with a seasonally adjusted annual rate of $486.7 billion, according to McGraw Hill Construction. Nonresidential building and residential building construction looked to be thriving toward the end of 2013, but those numbers have not lasted through the first few months of 2014.
In January and February, starts on construction projects totaled $66.7 billion, a 3 percent decline from the same time frame a year ago. Robert Murray, chief economist at McGraw Hill Construction, said in a statement this short time frame does not accurately reflect the industry as a whole.
"While construction activity has generally trended upward over the past two years, the monthly pattern has frequently been hesitant, and early 2014 has turned out to be one of those hesitant periods," Murray said.
Nonresidential construction fell by 9 percent in January for an annual rate of $141.9 billion. This is the third consecutive month this sector has posted declines. Commercial building, which constitutes as construction for office buildings, warehouses and hotels, increased by 10 percent in February.
Residential building increased during February. Construction jumped by 3 percent during the month for an annual rate of $213.8 billion. The rise was due to the 17 percent growth in multifamily housing, which offset the 1 percent decrease in single family housing. Murray went on to say the weather played a part in the overall drop.
"To some extent, the harsh winter weather has played a role in dampening construction activity, particularly as it relates to single family housing," Murray said. "At the same time, multifamily housing in early 2014 has been able to strengthen further. For nonresidential building, the upturn so far has been much more gradual and subject to setback, such as what took place in this year's first two months."
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