Townhouse Construction Up 7% Over Last Year

According to NAHB analysis of the most recent Census data of Starts and Completions by Purpose and Design, townhouse construction starts continue to post gains.

Over the last four quarters (ending with the first quarter of 2018), townhouse starts totaled 105,000, 7% higher than the prior four quarters. Townhouses, or single-family attached housing, accounted for 21,000 starts during the first quarter of 2018, although that was a slight decline from 22,000 recorded at the start of 2017.

Using a one-year moving average, the market share of new townhouses stands at 12.3% of all single-family starts. I expect future gains in the share as townhouses are a useful bridge from rentership from homeownership for younger prospective home buyers in high cost markets, among other market opportunities.

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.

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.



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1 reply

  1. I didn’t realize that the share for townhouse construction is expected to increase in coming years. My wife and I have been thinking of moving into a townhouse lately. We will have to find a place before demand becomes too high for townhouses.

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