WASHINGTON, Jan 3 (Reuters) - U.S. constructionspending surged to a near 1-1/2 year high in November asinvestment in public and private projects rose solidly,cementing expectations of strong economic growth in the fourthquarter.
Construction spending increased 1.2 percent to an annualrate of $807.1 billion, the highest level since June 2010, theCommerce Department said on Tuesday.
Spending in October was revised to a 0.2 percent fall, afterinitially reported as a 0.8 percent rise.
Economists polled by Reuters had expected constructionspending to rise 0.5 percent in November.
Overall construction spending was up 0.5 percent compared toNovember 2010.
Private construction spending rose 1.0 percent, advancingfor a fourth straight month. Spending on residential projectsincreased 2.0 percent, with solid gains in both multifamily andsingle family homes.
The housing market is showing some signs of recovery, withbuilders breaking more ground on new projects to meet growingdemand for rental apartments. It is becoming less of a drag onthe economy and is expected to significantly add to growth in2012.
Private nonresidential construction was flat in Novemberafter declining 0.6 percent the prior month.
Spending on public sector construction rebounded 1.7 percentin November as outlays on federal projects jumped 5.3 percentafter dropping 7.5 percent in October.
State and local government spending rose 1.3 percent afterfalling 1.2 percent the prior month. (Reporting By Lucia Mutikani; Editing by Neil Stempleman)