June Private Residential Construction Spending Dips 

Private residential construction spending fell by 0.7% in June, marking the sixth straight month of decreases. This decline was primarily driven by reduced spending on single-family construction. Compared to a year ago, total spending was down 6.2%, as the housing sector continues to navigate the economic uncertainty stemming from ongoing tariff concerns and elevated mortgage rates. 

According to the latest U.S. Census Construction Spending data, single-family construction spending declined by 1.8% in June. This decrease aligns with the weak single-family starts in June and the third lowest reading of NAHB/Wells Fargo Housing Market Index (HMI) since 2012. Compared to a year ago, single-family construction spending decreased by 5.3%. Meanwhile, multifamily construction spending stayed flat for the month but continued to follow the downward trend that began in mid-2023. Compared to June 2024, multifamily spending was down 9.5%. Improvement spending (remodeling) was up 0.5% in June but was 6.1% lower on a year-over-year basis.  

The NAHB construction spending index is shown in the graph below. The index illustrates how   spending on single-family construction has slowed since early 2024 under the pressure of elevated interest rates and concerns over building material tariffs. Multifamily construction spending growth has also slowed down after the peak in July 2023. Additionally, improvement spending has been weakening since the beginning of 2025.

Meanwhile, spending on private nonresidential construction was down 4% over a year ago. The annual private nonresidential spending decrease was primarily driven by a $14.7 billion drop in the manufacturing category, followed by a $13.7 billion decrease in commercial construction spending.