Townhouse Construction Weaker

Facebooktwitterpinterestlinkedinmail

According to NAHB analysis of the most recent Census data of Starts and Completions by Purpose and Design, townhouse construction slowed during the second quarter of 2019 after a strong 2018 performance. This market softness matches recent data in the NAHB HBGI, which showed weak construction activity for large metro suburban markets at the start of 2019. Nonetheless, townhouse construction is set for further expansion given the demographics of renters entering the for-sale market, as well as ongoing land constraints and the growth of demand for walkable neighborhoods.

Over the course of 2018, townhouse starts totaled 120,000, 15% higher than 2017. However, townhouses, or single-family attached housing, accounted for just 31,000 starts during the second quarter of 2019. This was lower than the 37,000 total for the second quarter of 2018, and lowers the growth rate for the last four quarter to -4%.. Using a one-year moving average, the market share of new townhouses stands at 13.1% of all single-family starts, off a post-recession high.

The peak market share of the last two decades for townhouse construction was set during the first quarter of 2008, when the percentage 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.



Tags: , , , , , ,

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: