After dropping 14% in 2020 due to economic fallout from COVID-19, total construction starts are expected to rise 4% in 2021, Richard Branch, chief economist at Dodge Data & Analytics, said while presenting the 2021 Dodge Construction Outlook on Nov. 10. The 2020 decline will bring starts to $738 billion, with the company expecting that number to grow to $771 billion in 2021. Branch notes that a vaccine that is widely adopted by mid-year and additional government stimulus are built into the Dodge forecast.
Total residential starts are expected to rise 5% in 2021, following a 2% drop in 2020. Single-family housing starts will rise 7% in 2021, to $254 billion, the highest since 2007. Branch attributes the rise to low mortgage rates in addition to overall increased interest in suburban areas caused by the pandemic. Multi-family housing, however, has fallen 14% in 2020 and is expected to drop another 1% in 2021.