E. Construction

4th Quarter 2018 Report

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The indicators of Hawaii’s construction industry were mixed in the third quarter of 2018. The private building authorizations, State CIP expenditures, and construction jobs increased; but the government contracts awarded decreased.

Construction has been one of the steady contributors to job growth in Hawaii over the past few years. In the third quarter of 2018, the number of jobs in the construction sector increased 0.6 percent or 200 jobs compared with the same quarter of 2017. In the first three quarters of 2018, the construction sector showed no change (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 2018, private building authorizations in the state increased $20.9 million or 2.9 percent, compared with the third quarter of 2017 (Table E-8). In the first three quarters of 2018, private building authorizations in the state increased $88.7 million or 3.6 percent compared with the same period of the previous year.

In the third quarter of 2018, private building authorizations in Honolulu decreased $70.0 million or 15.1 percent, compared with the third quarter of 2017 (Table E-8). In the first three quarters of 2018, private building authorizations in Honolulu decreased $105.9 million or 6.4 percent, compared with the same period of the previous year.

In the third quarter of 2018, private building authorizations in Hawaii County increased $82.8 million or 82.8 percent, compared with the third quarter of 2017 (Table E-8). In the first three quarters of 2018, private building authorizations in Hawaii County increased $111.0 million or 33.8 percent, compared with the same period of the previous year.

In the third quarter of 2018, private building authorizations in Maui County increased $23.8 million or 22.5 percent, compared with the third quarter of 2017 (Table E-8). In the first three quarters of 2018, private building authorizations in Maui County increased $71.8 million or 19.1 percent compared with the same period of the previous year.

In the third quarter of 2018, private building authorizations (residential only) in Kauai decreased $15.7 million or 29.7 percent, compared with the third quarter of 2017 (Table E-8). In the first three quarters of 2018, private building authorizations in Kauai increased $11.9 million or 10.8 percent compared with the same period of the previous year.

Government contracts awarded decreased $250.3 million or 38.8 percent in the third quarter of 2018 compared with the same quarter of 2017. In the first three quarters of 2018, government contracts awarded increased $430.6 million or 39.3 percent compared with the same period of the previous year (Table E-1). State government CIP expenditures increased $46.5 million or 12.3 percent in the third quarter of 2017 (Table E-2). In the first three quarters of 2018, CIP expenditures increased $337.5 million or 35.9 percent compared with the same period of the previous year.

The Honolulu Construction Cost Index increased 0.9 percent in the third quarter of 2018 compared to the same quarter of 2017 for Single Family Residence (Table E-6) and increased 1.2 percent for High-Rise Building (Table E-7). In the first three quarters of 2018, the index for Single Family Residence increased 0.1 percent and 0.3 percent for High-Rise Building from the same period of the previous year.

In the second quarter of 2018, Honolulu’s median price for single family resales was $781,194, an increase of $27,194 or 3.6 percent compared to the same quarter of 2017 (Table E-11). The median price for condominium units was $421,000, up $18,000 or 4.5 percent over the same quarter of 2017 (Table E-12). In the third quarter of 2018, the number of single-family unit resales declined 7.3 percent, and the number of condominium unit resales declined 2.7 percent, compared with the third quarter of 2017 (Tables E-13 and E-14). In the first three quarters of 2018, the number of single-family unit resales declined 3.7 percent, and condominium unit resales declined 0.1 percent compared with the same period in 2017.

In the first quarter of 2018, Maui County’s single-family unit resales median price was $690,000 or $10,000 and 1.4 percent lower than in the first quarter of 2017. The condominium unit resales median price was $475,000 or $2,413 and 0.5 percent lower than in the same quarter of 2017. (Tables E-17 and E-18).