A rebound in housing production in urban core and exurban markets suggests a shift in single-family home buying geared toward suburban and higher density areas, according to NAHBNow. On the other hand, multifamily permitting is on the rise in smaller metros and rural areas, but the pace is slowing in larger metropolitan markets. Second home markets are also reporting construction growth with a third quarter year-over-year increase of 36.1% compared to 23.2% in non-second home markets.
“As more workers transitioned back to the workplace, there was a rebound for housing production in urban core markets, as well as ongoing growth in exurban areas,” said NAHB Chairman Chuck Fowke. “And while builders are still grappling with affordability headwinds in both small and large markets, this rebound in housing production in some higher density markets where building is more costly highlights the need for policymakers to reduce housing supply barriers that are driving up home prices.”
The four-quarter moving average for large metro core area single-family permit growth between the third quarter of 2019 and 2020 was 5.6%, while exurbs grew at a rate of 12.3%. Jumping ahead a year, the new permit rate of growth in this same four-quarter period between 2020 and 2021 increased to 21.1% for large metro core markets and 30.8% for the exurbs.
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