Construction Forecast To Rebound Next Year

Washington, DC, Oct. 16, 2009 -- Construction should see a modest rebound next year, according to the latest forecast by McGraw-Hill Construction.

The report indicated that a rise in the building of single-family houses, apartment buildings, and highways and bridges will offset drops in commercial and manufacturing property.

The construction forecast released Friday is another indicator that the recovery is likely to be bumpy. New development will continue to be dragged down by high unemployment and tight credit markets.

This year the value of starts was expected to fall 25% to $419 billion.

Next year, starts are expected to rise 11% to $466.2 billion, according to McGraw-Hill. Construction starts indicate future construction spending and often correlate strongly with actual spending.

Single-family housing should come in at $162.2 billion, a 30% boost to 560,000 units, provided that mortgage rates remain low, the $8,000 tax credit for first-time home buyers is extended and programs to ease the foreclosure crisis help homeowners, the survey said.