Washington, October 1--A surge of homebuilding pushed total outlays for construction projects up by a better-than-expected 0.8 percent in August, the Commerce Department said Friday.
Outlays in July were also revised much higher, to a 1.1 percent gain from 0.4 percent previously. Economists were expecting a smaller gain of 0.4 percent in August. With the revisions in July, August outlays were 1.4 percent higher than expectations
Construction spending reached a record $1.02 trillion seasonally adjusted annual rate in August. Construction spending is up 10.1 percent in the past year. The figures are not adjusted for inflation.
Construction outlays are being fueled by low interest rates, growing demand and surging prices for construction materials. Lumber, steel and plywood prices are all up more than 20 percent in the past year.
Homebuilding was particularly strong in August, growing 1.7 percent to a record $550.6 billion annualized after a 0.6 percent gain in July. Private residential spending is up 14.5 percent in the past year.
Nonresidential private spending was also healthy for a second straight month, rising 0.8 percent to $227.0 billion annualized in August after gaining 2.2 percent in July. It's the highest since June 2002. Nonresidential private spending is up 7.7 percent in the past year.
Private spending increased 1.4 percent, the biggest increase in 10 months.
Public construction outlays fell 1 percent to $237.6 billion in August, reversing July's 1.1 percent gain. Public spending is up 3.2 percent in the past year.
Within the private sector, spending on commercial space increased 1.3 percent. Spending on offices fell 1 percent and health care fell 1.2 percent. Big gains were recorded in private educational facilities, communication and power.
In the public sector, spending on streets fell 2.9 percent while spending on schools sank 2 percent.
