New Construction Starts in April Pull Back 13 Percent

NEW YORK, N.Y. – The value of new construction starts in April fell 13 percent from the previous month to a seasonally adjusted annual rate of $674.3 billion, according to Dodge Data & Analytics. The decline follows the 11 percent gain reported for March, which was the highest level of construction starts over the preceding six months.

The loss of momentum in April was widespread, involving each of the three main construction sectors. Nonbuilding construction (public works and electric utilities/gas plants) plunged 22 percent after its 74 percent hike in March that featured the start of the $3.5-billion Mountain Valley Pipeline expansion in West Virginia and Virginia, as well as several large highway projects. Nonresidential building retreated 12 percent due to a slower pace by its institutional and manufacturing segments. Residential building dropped 9 percent with reduced activity for both single-family and multifamily housing. During the first four months of 2018, total construction starts on an unadjusted basis were $223.5 billion, down 7 percent from the same period of 2017 (which included very strong amounts for airport terminals and natural gas pipelines). On a 12-month moving total basis, total construction starts for the 12 months ending April 2018 matched the dollar amount that was reported for the twelve months ending April 2017.

April’s data lowered the Dodge index to 143 (2000=100), down from a revised 165 for March. Taking the average for March and April produces an Index reading of 154, slightly above the 152 average for January and February, although still below the 161 average for the full year 2017.