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Medium-density housing development, including townhouses, duplexes, and other small multifamily properties, trended slightly higher during the second quarter of 2022, but this missing middle construction sector has remained mostly flat even during times of immense growth for other construction segments. While townhouse construction ticked upward during Q2 2022, multifamily starts saw a slight decline to just 12,000 units started. The second quarter of 2022 also saw a gradual incline in 2 to 4 unit multifamily housing construction starts with a total of 5,000 units, the largest quarterly gain in this market segment since the middle of 2008, Eye on Housing reports.
While townhouse construction has trended higher in recent quarters, the multifamily segment of the missing middle (apartments in 2 to 4 unit properties) has disappointed. For 2021, there were only 12,000 starts of such residences. This is flat from from 2020, during a period of time when most construction segments expanded.
As a share of all multifamily production, 2 to 4 unit development is only 3.4% of the total. In contrast, from 2000 to 2010, such home construction made up a little less than 11% of total multifamily construction. Construction of the missing middle has clearly lagged during the post-Great Recession period and will continue to do so without zoning reform focused on light-touch density.
