U.S. construction spending increased in June by the smallest amount in five months as a big drop in nonresidential building activity offset a third straight increase in home building.

The Commerce Department says construction spending edged up a slight 0.1 percent in June following a 1.8 percent increase in May and a 3.8 percent rise in April. Even with the June slowdown, construction spending advanced to a seasonally adjusted annual rate of $1.06 trillion, the best pace in seven years.

Residential construction was up 0.4 percent. But nonresidential building slipped 1.3 percent in June, with the category that covers shopping centers falling 4.4 percent. Spending on government building projects was up 1.6 percent as a solid increase at the state and local levels offset a drop in federal projects.