Today, the Bureau of Economic Analysis (BEA) released their first installment of the Q2 2008 GDP report showing a continuation of anemic growth with an annual rate of 1.9%.
More importantly though, the BEA revised all estimates going back to 2005 generally amending the decline in the “residential investment” component to be larger while revising the overall GDP lower for many past quarters.
In fact, it appears now that Q4 2007 was, in fact, mildly negative, the first negative quarter since the recession that followed the dot-com implosion.
This continuation of dramatically slower growth was primarily the result of significant declines in fixed residential investment, only tepid growth in fixed non-residential investment.
Residential fixed investment, that is, all investment made to construct or improve new and existing residential structures including multi–family units, continued its historic fall-off registering a whopping decline of 15.6% since last quarter shaving 0.62% from overall GDP.
The following chart shows real residential and non-residential fixed investment versus overall GDP since Q1 2003 (click for larger version).