At a seasonally adjusted annual rate of $573.0 billion, new construction starts in February were essentially unchanged from the previous month, according to McGraw-Hill Construction, a division of The McGraw-Hill Companies. Residential building continued at a healthy pace and public works rebounded from a weak January. However, nonresidential building in February lost momentum. For the first two months of 2005, total construction on an unadjusted basis came to $78.9 billion, basically the same amount reported during the first two months of 2004.
"Total construction in 2005 is not likely to repeat the 10% growth witnessed in 2004, but the overall level of activity is still expected to stay close to last year," stated Robert A. Murray, vice president of economic affairs for McGraw-Hill Construction. "Eventually, higher interest rates will dampen single family housing, and even with its lackluster start to 2005, nonresidential building is anticipated to pick up some of the slack as the year proceeds."