E. Construction

4th Quarter 2019 Report

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The indicators of Hawaii’s construction industry were mixed in the third quarter of 2019. Private building authorizations, and construction jobs increased, while government contracts awarded and State government CIP expenditures decreased.

Construction has been one of the steady contributors to job growth in Hawaii over the past few years.  In the third quarter of 2019, the number of jobs in the construction sector increased 3.0 percent or 1,100 jobs compared with the same quarter of 2018.  In the first three quarters of 2019, the construction sector added 833 jobs or 2.3 percent (Table A-7) from the same period of the previous year.  Before the recession, specifically the period 2002 through 2007, construction job growth averaged 8.0 percent per year.  In the fourth quarter of 2007, the average number of construction jobs reached a peak of 40,000 jobs.  The strength of the construction job market in the past few years was a sharp contrast to the recession period.  From the second quarter of 2008 until the second quarter of 2011 quarter-over-quarter construction job growth was negative in all quarters.

In the third quarter of 2019, private building authorizations in the state increased $55.5 million or 7.5 percent, compared with the third quarter of 2018 (Table E-8).  In the first three quarters of 2019, private building authorizations in the state decreased $182.9 million or 7.2 percent compared with the same period of the previous year.

In the third quarter of 2019, private building authorizations in Honolulu increased $63.6 million or 16.1 percent, compared with the third quarter of 2018 (Table E-8).  In the first three quarters of 2019, private building authorizations in Honolulu decreased $36.5 million or 2.4 percent, compared with the same period of the previous year.

In the third quarter of 2019, private building authorizations in Hawaii County decreased $7.4 million or 4.1 percent, compared with the third quarter of 2018 (Table E-8).  In the first three quarters of 2019, private building authorizations in Hawaii County decreased $17.3 million or 3.9 percent, compared with the same period of the previous year.

In the third quarter of 2019, private building authorizations in Maui County increased $6.7 million or 5.2 percent, compared with the third quarter of 2018 (Table E-8).  In the first three quarters of 2019, private building authorizations in Maui County decreased $97.4 million or 21.8 percent compared with the same period of the previous year.

In the third quarter of 2019, private building authorizations (residential only) in Kauai County decreased $7.3 million or 19.6 percent, compared with the third quarter of 2018 (Table E-8).  In the first three quarters of 2019, private building authorizations in Kauai County decreased $31.6 million or 25.8 percent compared with the same period of the previous year.

Government contracts awarded decreased $228.5 million or 58.0 percent in the third quarter of 2019 compared with the same quarter of 2018. In the first three quarters of 2019, government contracts awarded declined $1,074.3 million or 70.4 percent compared with the previous year (Table E-1). State government CIP expenditures increased $4.7 million or 1.1 percent in the third quarter of 2019 compared with the same quarter of 2018 (Table E-2). In the first three quarters of 2019, State government CIP expenditures decreased $128.4 million or 10.4 percent compared with the same period of the previous year.

The Honolulu Construction Cost Index increased 4.3 percent in the third quarter of 2019 compared to the same quarter of 2018 for Single Family Residence (Table E-6) and increased 4.7 percent for High-Rise Building (Table E-7).  In the first three quarters of 2019, the index for Single Family Residence increased 3.0 percent and 2.9 percent for High-Rise Building as compared to the same period in the previous year.

In the third quarter of 2019, Honolulu’s median price for single family resales was $800,000, a decrease of $5,000 or 0.6 percent compared to the same quarter of 2018 (Table E-11).  The median price for condominium units was $440,000, up $12,000 or 2.8 percent over the same quarter of 2018 (Table E-12).  In the third quarter of 2019, the number of single-family unit resales increased 8.7 percent, and the number of condominium unit resales declined 2.8 percent, compared with the third quarter of 2018 (Tables E-13 and E-14).  In the first three quarters of 2019, the number of single-family unit resales increased 0.8 percent, and condominium unit resales declined 6.7 percent compared with the same period of the previous year.

In the first three quarters of 2019, Maui County’s single-family unit resales median price was $745,845 and the condominium unit resales median price was $518,000 (Tables E-17 and E-18).