Residential Construction Drives 5% Growth in August as Nonresidential Starts Lag

Confidence in the building industry continues to grow as total construction starts rose 6% in August to a seasonally adjusted annual rate of $1.2 trillion. 

The increase in projects is good news for the glass and glazing industry, as more projects equal more work. 

However, despite August’s growth, nonresidential building starts remained sluggish, falling 2% compared to a 5% growth in the residential sector.

Year-to-date, the total construction starts index was 4% higher than August 2023. Residential starts were up 8%, 

and nonresidential buildings rose 3%. The Dodge Construction Network (DCN) releases the total construction starts index monthly.

“Construction starts continue to move forward at a modest pace,” explains Richard Branch, DCN’s chief economist. 

“Now that the Federal Reserve has begun to lower rates, the construction sector should feel relief. 

The DMI has been steady, indicating that owners and developers feel reasonably confident that market 

and financial conditions will improve. They will improve, but it will take successive rate cuts before 

they feel comfortable moving these projects forward. Starts should show stronger and more consistent growth in the first quarter of 2025.”

Nonresidential

Nonresidential building starts fell 2% in August to a seasonally adjusted annual rate of $437 billion. 

Commercial starts lost 32% and manufacturing starts dropped 21%. These declines were almost 

offset by a 32% gain in institutional starts driven by education and airport terminals. 

On a year-to-date basis through August, total nonresidential starts were up 3%.

The largest nonresidential building projects to break ground in August were the $2.9 billion terminal 

3 modernization at San Franciso International Airport in San Francisco, the $1.3 billion Marshall County

 EV plant in Byhalia, Mississippi, and the $900 million Geisinger Wyoming Valley Hospital in Wilkes-Barre, Pennsylvania.

Residential

Residential building starts improved 5% in August to a seasonally adjusted annual rate of $383 billion. 

Single-family starts rose 7%, while multifamily starts were 1% higher. On a year-to-date basis through eight months, 

total residential starts were 8% higher. Single-family starts jumped 19%, and multifamily starts were down 10% 

compared to August 2023.  For the 12 months ending August 2024, residential starts were 6% higher than the previous 12 months.

The largest multifamily structures to break ground in August were the $332 million West Brighton I & II Apartments

 in Richmond County, New York, the $235 million Cooper Park Commons in East Williamsburg, New York, and the $248 million The Downs mixed-use building in Northville, Michigan.