By MARTIN CRUTSINGER
U.S. construction spending dropped 1.7 percent in March, the biggest setback in 11 months, with weakness in a number of sectors including the biggest plunge in home building in nine years.
The March decline was the first monthly drop since last July and the biggest contraction since a 1.8 percent fall in April 2017, the Commerce Department reported Tuesday. Spending on residential construction was down 3.5 percent, the worst showing since a 4.2 percent decline in April 2009.
Economists are forecasting that construction spending will contribute to overall growth this year even though interest rates are rising. Home mortgage rates are now at their highest levels in four years and the Federal Reserve, which is meeting this week, is expected to keep gradually raising rates this year to guard against inflation pressures getting out of hand.
The Fed, which raised rates in March, left its benchmark rate unchanged this week but is expected to raise rates again in June.
In the construction report, the 3.5 percent drop in residential spending reflected a 2.7 percent fall in spending on apartment construction and a smaller 0.4 percent decline in single-family home construction.
Total construction spending had been steadily rising since last August. Even with the March drop, spending at an annual rate of $1.28 trillion is close to record highs and 3.6 percent above where it was a year ago.
West Milford residential salesAccording to the New Jersey Realtors®, new listings in West Milford were up in March 2018 over 2017 by 28 percent. Closed sales more than doubled in March, at 46 closings over 29 in March 2017.
However, the median sales price dropped from $238,000 in March of last year, to $209,500 in March 2018.
Sellers were able to increase the percent of the list price of a home by 1.7 percentage points. In March 2018, buyers paid an average of 96.5 percent of the list price of a home.
The number of homes for sale in West Milford in last month was 192, slightly less inventory than this time last year, when 216 homes were on the market in March. The monthly supply of homes for sale dropped to 5.2 months worth of homes in March verse 6.3 months worth in March of 2017.
There were 73 new listings of single family homes in West Milford in March of this year compared to 57 new listings of single family homes in March of 2017.
Julie Boyd Cole of The West Milford Messenger contributed to this report.