Due to the surge in multifamily development and the ongoing modest growth for single-family, there has been a noticeable shift in the market shares of housing units under construction. The Census housing starts data illustrate a trend to more multifamily units in the production pipeline.
Using the seasonally adjusted Census estimates, at the end of November there were 549,000 multifamily units under construction. This is in contrast to just 416,000 single-family units. The multifamily share of units under construction, which averaged just under 32% from 2000 to 2006, now stands at almost 57%.
These data detail the potential for growth in the single-family market. Keep in mind that for the October new home sales data, there were just 226,000 newly built homes for sale, a 5.5 months’ supply. And of that total, only 52,000 were completed, ready to occupy inventory.
NAHB expects the growth rate for multifamily starts to slow, while single-family increases. These changes will alter the market shares of units currently under construction.