Private Residential Spending Hit 50 Year High as Pct. of GDP Last Year... And Now the Record Decline
This chart shows that private residential investment has been on a steady growth path since the early '90s for almost 15 years and reached a 50 year record of 6.3% of GDP recently, before the sharp decline started.
Private residential construction spending fell by 1.6% in November 2006 to $589.3 billion annual rate, after dropping 1.7% in October. Spending on private residential construction projects has fallen 8 months in a row, the longest drop on record. PRI has now declined 11.1% in the 12 months since November 2005.
Another interesting insight from this chart is, most of the downtrends are pretty severe, wiping away all the gains from the preceding boom cycle. The average of PRI as a % GDP over the last 50 years is about 4.7%.