Residential spending fell 5.4% in September, and Nov 13 brings 2 new bids
Residential construction spending dropped 5.4% in one month, from $910.2B to $861.2B. Nonresidential went the other way. If you price house work, expect customers to push back on numbers. If you price commercial or federal work, the pipeline is holding up better than the headlines suggest.
New to bid on
Only 2 new construction solicitations have posted since Wednesday, Nov 11, and both are electrical work, one in Tennessee and one in Arkansas. That is thin, so I am not going to pad it.
- Veterans Affairs, generator PM and bank testing, base plus 4, Murfreesboro, TN. Closes December 9. Service-Disabled Veteran-Owned Small Business set-aside (SAM.gov)
- Forest Service, Womble Work Center fiber optic installation, Mount Ida, AR. Closes December 1. Small business set-aside, total (SAM.gov)
The wider board is still big. There are 4,188 open solicitations, and 2,286 of them close this week. The chart above the story shows open solicitations by month, and November's 4,188 sits under October's 4,892.
The number that moved
Residential construction spending came in at $861.2B in September, a seasonally adjusted annual rate. The month before it was $910.2B. That is a 5.4% drop in a single month and 8.8% below a year ago. The source is the U.S. Census Bureau, via FRED.
Here is the math. A drop that size means fewer new houses and fewer big remodels getting started. Fewer starts mean more crews chasing the same jobs. Expect tighter bids and slower deposits this month. Nonresidential spending rose 0.6% to $1,325.0B, so commercial work is not feeling it yet. The 30-year mortgage rate eased to 7.11% from 7.18%, which is a small help but not a fix. Housing starts and building permits both come out November 18. Starts were 1.22M last time, down from 1.29M. Watch those two before you quote anything long.
Three worth two minutes
- Clark, AECOM JV selected for $3B Kansas City Chiefs stadium, Construction Dive. Big jobs like this pull subs and labor out of the local market, so expect tighter crews in that region.
- Construction site next to fatal Brooklyn collapse previously violated stop-work order: DOB, Construction Dive. Eight people died, and an ignored stop-work order is the kind of thing that ends a company.
- Brooklyn building collapses into adjacent construction site, leading to multiple deaths, Construction Dive. The cause is still under investigation, so check your own shoring and neighbor protection plans today.
Today, pull your open residential quotes and look at which ones depend on a customer's financing. Call those customers before they call you with a lower number in mind.
