The contribution of housing construction to GDP.

The contribution of housing to GDP is typically 15-18% and is accomplished in two main ways.

The first way is through residential investment (averaging about 3-5% of GDP), which includes construction of new single- and multi-family buildings, home renovations, mobile home production, and broker commissions.

The second is housing services spending (averaging about 12-13% of GDP), which includes rents and utilities paid by renters, as well as fictitious rents and utility payments by property owners.

The inclusion of fictitious rents (an estimate of the rental value of owner-occupied housing) in GDP has long been standard' 'practice in national income accounting. If fictitious owner rents were not accounted for, increasing levels of home ownership would lead to lower GDP.

The table linked below shows the ratio of housing as both investment and expenditure in the annual GDP report.

All GDP components are adjusted for inflation and reflect the categories in the GDP statistics released by the U.S. Bureau of Economic Analysis.

Download a table showing the aggregate contribution of housing construction to' 'GDP.

Note: For the period to December 2020, estimates were made using 2012 chain-index weighted data. Nominal estimates provide a better comparison of the GDP figures used to estimate the share of housing construction in GDP.