Construction Spending Falls 1.9% as Housing Slows
Residential builders and trade contractors should watch order books as housing-linked spending dropped 5.5% in September.
Updated on Nov. 2, 2026 in Construction
Live Poll
Do you think the national economy is getting better or worse for households?
U.S. construction spending fell 1.9% in September 2026 to a seasonally adjusted annual rate of $2,186.1 billion, with residential construction down 5.5%. Contractors, developers and suppliers across the construction sector are seeing a weaker spending backdrop heading into the close of 2026.
Why it matters
The monthly decline follows a revised August estimate of $2,227.4 billion, and spending is down 2.7% from September 2025, signaling softer demand for project work. Residential weakness is the sharpest driver, which matters most to builders and trades tied to housing starts.
Federal construction spending data show September 2026 at $2,186.1 billion, down 1.9% month over month and 2.7% year over year. Private spending stood at $1,639.3 billion, public spending at $546.8 billion, and nonresidential spending at $790.6 billion, while year-to-date spending through September is 2.9% below 2025.
The players
U.S. Census Bureau
The federal statistical agency that produces the monthly construction spending estimates used to track industry activity across the country.
The details
Construction spending figures are reported as seasonally adjusted annual rates, which means each monthly estimate is scaled to an annual pace and compared against the revised prior-month estimate. The September comparison runs against an August figure that was itself revised, so the 1.9% monthly decline reflects the current revised baseline. Residential construction carried the steepest drop at 5.5%, while private spending totaled $1,639.3 billion in the month.
Timeline
September 2025: baseline month for the year-over-year comparison.
August 2026: revised prior-month estimate used for the monthly comparison.
September 2026: month covered by the construction spending estimate.
November 2, 2026: construction spending report published.
Market Landscape
The Census Bureau's monthly Construction Spending series, built on seasonally adjusted annual rates, is the standard gauge for construction activity nationally. September's 2.7% year-over-year decline and 2.9% year-to-date drop place the sector on a softer footing than in 2025.
Builders and trade contractors with heavy residential exposure should watch order books and pricing closely as residential spending fell 5.5% in the month. Operators in public-works and nonresidential work may see steadier demand, since public spending held at $546.8 billion, but should review project pipelines with qualified accountants before committing capital.
The takeaway
Residential-heavy contractors should treat the 5.5% monthly drop as a signal to stress-test cash flow against slower housing-linked work. Track the next monthly Census construction spending release to see whether the decline persists or stabilizes.
Further reading
For broader context on how building activity is tracked, explore the Construction section.
Live Poll
Do you think the national economy is getting better or worse for households?
