Almost Even Split Between Natural Gas and Electric Heating Systems in New Homes

The Census Bureau’s Survey of Construction (SOC) provides valuable information on the characteristics of new homes started construction, such as air conditioning and heating system installations.

Air Conditioning

In 2021, 97 percent of new single-family homes started had a central AC system, higher than 95.4 percent in 2020. The trend, going back to 2000, shows a steady rise in the share of new homes with central AC, increasing from 86 percent in 2000 to 97 percent in 2021 (Figure 1).

Though the share of new single-family homes started with central AC differs across the country’s nine Census divisions (Figure 2), the highest share is concentrated in the Midwest and South region. One hundred percent of homes started in the South Atlantic and East South Central divisions had central AC installed, followed by 99 percent in the West North Central as well as West South Central. The divisions with the lowest shares of new homes with central AC are New England (90 percent) and the Pacific (86 percent), albeit both shares have steadily increased over the past three years.

Heating Systems

Almost all of new single-family homes started use either an air/ground source heat pump or a forced air system for the primary heating equipment (99 percent in 2021). Eighteen percent of homes also used a secondary type of heating equipment. In general, the share of new homes using an air or ground source heat pump as the primary means of providing heat has increased, going from 23 percent in 2000 to 40 percent in 2021. Meanwhile, the share relying on a forced air system has slipped, going from 71 percent to 58 percent in the same time frame.

The type of heating system installed varies significantly by Census Division. Figure 3 displays the share of new homes with an air or ground heat pump in 2020. In warmer regions of the country, these systems are more common: 78 percent in the South Atlantic,75 percent in the East South Central, and 23 percent in Pacific. In colder regions, very few homes have air or ground heat pumps: only 9 percent of new homes started in Middle Atlantic and 11 percent in the New England.  In colder climates, air source heat pumps (traditionally the most common type) become less efficient and rely more heavily on a back-up heating system during the winter.

The SOC also provides data on the primary fuel used to heat new single-family homes (Figure 4). Approximately 49 percent of new homes started in 2021 use natural gas as the primary heating fuel, compared to 47 percent powered by electricity.  The shares of new homes with electricity and natural gas as the primary heating fuel have been stable since 2012. Like heating and AC systems, the primary heating fuel source varies significantly by region of the country. For example, in New England, only 10 percent of new homes use electricity as the primary heating source. In contrast, 79 percent and 71 percent of new homes started in the South Atlantic and the East South Central use it. These are the same two divisions where heat pumps, which run on electricity, are most common. This is also in line with findings from NAHB’s What Home Buyers Really Want, 2021 Edition, in which consumers in South region generally prefer electricity for their heating and cooling system.

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