Garbage In Garbage Out – Govt corrects construction data
The Commerce Department’s November construction spending report contained the following footnote: “Monthly and annual estimates… for January 2005 through October 2015 have been revised to correct a processing error in the tabulation of data on private residential improvement spending.”
No big deal, right, since it was just a processing error and mentioned only in a footnote. But read this: “The upward revision to spending in 2014 is enough to raise growth that year from 2.4% to 2.6%-2.7%,” wrote IHS Global Insight US economist Patrick Newport in a research note. “The revisions are likely to boost growth for 2015 as well.”
US GDP in 2013 was just under $17 trillion, so an extra 0.2-0.3% growth in 2014 would add about $400 billion. Yep, that’s only worth a footnote, according to the Government. But it does suggest that we have been spending more improving our homes than previously reported, another indication of greater confidence in the housing market.
Read Market Watch’s How the government miscalculated a decade’s worth of data for more details.
If you – or somebody you know – are considering buying or selling a home and have questions about the market and/or current home prices, feel free to contact me on 617.834.8205 or Andrew.Oliver@SothebysRealty.com.
Andrew Oliver is a Realtor with Harborside Sotheby’s International Realty. Each Office Is Independently Owned and Operated
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