The number of construction starts nationwide climbed 6% to a seasonally adjusted rate of $1.2 trillion in August, according to the latest data from the Dodge Construction Network (DCN). For the month, residential starts rose 5%, nonbuilding starts were up by 17%, and nonresidential buildings fell by 2%. 

On a year-to-date basis through August, total construction starts were up 4% from the first eight months of 2023. Residential starts were up 8%, nonresidential buildings 3%. Total nonbuilding starts were down 1%. The total number of construction starts was up 2% from the 12 months ending August 2023. Residential starts were up 6% compared to the same year, while nonresidential building and nonbuilding starts each went up by 1% on a 12-month rolling sum basis.  

"Construction starts continue to move forward at a modest pace," DCN chief economist Richard Branch said. "Now that the Federal Reserve has begun to lower rates the construction sector should begin to feel relief. The Dodge Momentum Index has been steady, indicating that owners and developers feel reasonably confident that market and financial conditions will improve. Improve they will, but it will take successive rate cuts before they feel comfortable moving these projects forward to start. Starts should show stronger and more consistent growth in the first quarter of 2025."

The largest projects to break ground for August were the Gensler-led $2.9 billion terminal 3 modernization at San Francisco International Airport, followed by a $1.3 billion EV plant project in Mississippi. Multiple solar farm projects were recorded above $500 million in the nonbuilding category.

This is the second consecutive month for increases in the DCN index and follows a 10% climb to $1.1 trillion for July powered mostly by nonresidential building projects and infrastructure. Regionally, starts rose in the Northeast, West and South Central regions while falling in the Midwest and South Atlantic.