Construction and Real Estate: Summary - September 2009

Business contacts and recent data releases continued to report gains, although from weak levels, in District housing markets for August. However, the gains were not as robust as those seen in July, according to many contact reports. Florida Realtors continued to report year-over-year growth in home sales, with the low end of the market dominating activity. Contacts continued to note that sales activity was being spurred by first-time home buyer incentives. As in July, builders reported low levels of home sales and construction activity, and data releases reinforced this view. However, permit data continued to improve from recent historical lows. The outlook among both builders and Realtors indicated that sales improvements would continue over the next several months.

Commercial development remained weak across the District. Vacancy rates continued to trend up, with contacts noting greater downward pressure on rents. Developers continued to report fewer backlogs and more projects being delayed. Most commercial contacts anticipate weaker activity for the rest of 2009 and into 2010. Recent data support the view that commercial construction activity will continue to soften.