Multi-family construction resumes in small towns
In the second trimester, multi-family construction has increased dramatically in small towns and affordable suburbs, reflecting demographic shifts in the wake of the coronavirus, according to the latest data from the National Association of Home Builders.
The pace of multi-family residential construction increased 14.3% year-over-year in small metropolitan urban areas and 25.5% in small suburban metropolitan areas, the Geography Index of Metropolitan revealed. residential construction released by the NAHB. The index also showed a 20.5% increase in multi-family construction in small towns or “micro counties”. In the larger cities, the pace of construction has slowed down.
“Major metropolitan areas saw a 0.5% year-over-year decline, reflecting the adverse effects of the ongoing viral crisis on housing in major counties in major metropolitan areas that began ago more than a year, “Litic Murali, NAHB economist, said in the association’s report. Blog Eye on Housing.
Constantly increasing house prices and the increase of home working arrangements served to stimulate interest in sparsely populated areas. Major counties in major metropolitan areas saw their share of multi-family residential construction activity fall to 38.7% from 40.2% in the first quarter.
But even with the growing number of multi-family units now being built in smaller communities, large metropolitan areas still account for 64.7% of all such construction. Multi-family residences in the heart of small towns and outlying counties as well as in small towns accounted for 31.4%. According to the NAHB, the growth rate of the multi-family sector was moderately higher in counties with more than affordable housing.
Single-family residential construction has increased in all regional types, testifying to the hot housing market and a US Census Bureau report showing spending on private residential construction up 26.5% year after year in July. Spending, however, has also been high due to continued high price of wood, which has plagued home builders all year round.
The outlying counties of large metropolitan areas posted the strongest growth in single-family housing starts, climbing 36.3% year over year. Counties outside small metropolitan areas also jumped 31.7%, with small metropolitan areas up 28%. Large suburban counties grew 31.2% and the single-family home construction rate climbed 26.2% in urban centers. Micro-counties and those not categorized saw increases of 26.8% and 31.9%.
But Murali noted that the expansion of single-family construction was “partly inflated due to the decline the year before with the start of the COVID-19 pandemic.”