Owner/Contractor Built Housing Market Share Flat at End of 2013

The market share of homes built on an owner’s land, with either the owner or a builder acting as the general contractor, was effectively flat on a quarter-over-quarter basis at the end of 2013.

Census Data from the Quarterly Starts and Completions by Purpose and Design survey indicate that the number of starts of this type of custom home building rose slightly by count from the final quarter of 2012 (30,000 starts) to the fourth quarter of 2013 (32,000 starts).

However, as the rest of the single-family construction market expanded, the market share of owner and contractor built housing has fallen significantly. As measured on a 1-year moving average, the market share has fallen to 21.7%, down from a cycle high of 31.5% set during the second quarter of 2009. In fact, the 1-year moving average has now fallen for seven consecutive quarters, although these declines have slowed recently. The 1-year moving average fell from 21.9% in the third quarter to 21.7% in the fourth.

Owner_contractor starts_4q13

The onset of the housing crisis and the Great Recession interrupted a 15-year long trend away from homes built on the eventual owner’s land. However, as housing production slowed in 2006 and 2007, the share of this not-for-sale new housing increased even as the number of starts declined. The share increased because the credit crunch made it more difficult for builders to obtain AD&C credit and for home buyers to obtain mortgage financing, thus producing relatively greater production declines of for-sale single-family housing.



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0 replies

  1. Excellent data. Its the numbers that matter most (left side of the chart) as market share really reflects growth in production/spec,.. also indicating better economic health than 2009-2011.There is steady recovery from the bottom, but a long way to go…. a small share of a growing total is better than a large share of “zero”

  2. The Owner/Contractor Built Housing Market Share is Flat because many of the true custom home builders across the country rely on referral based business.Most believe that their clients will continue to come to them and they don’t have to Market their company.

    The production builders have the deep pockets and resources to purchase and develop their own communities. Their marketing and advertising budgets are huge and the True custom home builder can’t compete and they are losing a huge share of the market across the country.

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