Infills or Teardowns in Older Neighborhoods Are Helping Builders Battle Land Shortages

One in four new homes built in 2020 were constructed in infill lots or involved teardowns in established neighborhoods, according to the NAHB’s Eye on Housing. In northeastern states like New England, infills and teardowns accounted for nearly half of the new-home market, but midwestern states reported a share under 20%.

A rising trend for infill construction comes in the wake of land shortages and low housing stock across the country. By revamping residential neighborhoods or reconstructing old homes, builders can bypass major construction obstacles and expand existing housing markets.

At 18.6% of the new single-family detached home market, homes built on infill lots in older neighborhoods are a substantial part of the market. The North East and Pacific stand out for registering significantly higher market shares for infill homes. In New England, more than a third (34.6%) of new single-family detached homes are built on infill lots. The market share of infills in the Middle Atlantic is almost 30%, followed by the Pacific (24.1%). At the other end of the spectrum is the Midwest, where the market share for infill homes is just above 12%. The lack of developable land is likely to boost infill development and helps explain its relatively high market share.

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