According to NAHB analysis of the most recent Census data of Starts and Completions by Purpose and Design, townhouse construction starts continued to grow at the start of 2016.
Over the last four quarters townhouse starts totaled 94,000, a nearly 29% gain over prior year total. For the first quarter of 2016, townhouse starts came in at 22,000, a noticeable gain over the 14,000 recorded at the start of 2015.
Using a one-year moving average, the market share of new townhouses stands at 12.6% of all single-family starts for the first quarter of 2016.
The peak market share of the last two decades for townhouse construction was set during the first quarter of 2008, when the share reached 14.6% of total single-family construction. This high point was set after a fairly consistent increase in the share beginning in the early 1990s.
Despite the drop in market share during the Great Recession, the share for townhouse construction is expected to increase in coming years – with occasional ups and downs.
The long-run prospects for townhouse construction are positive given large numbers of homebuyers looking for medium density residential neighborhoods, such as urban villages that offer walkable environments and other amenities.