Adobe Stock / Piotr Adamowicz

The slowdown in single-family construction is most pronounced in large metro areas, according to data from the second-quarter NAHB Home Building Geography Index (HBGI). Single-family building activity was down 24.8% year over year in large metro – core counties.

Across the single-family market, the 4-quarter moving average of the year-over-year growth rates remained negative for all markets in the second quarter of 2023. Between the second quarter of 2022 and the second quarter of 2023, the growth rates across all markets fell double digits, with the largest change in growth rate occurring in Large Metro – Outlying Areas.

Over the past four years rural markets have exhibited strength. The rural (Micro Counties and Non Metro/Micro Counties) single-family home building market share has increased from 9.4% at the end of 2019 to 11.7% by the second quarter of 2023. The combined market share for Large Metros (Core, Suburban, Outlying) remained below 50% for the second consecutive quarter as it was unchanged at 49.8%.

The multifamily market started to show signs of cooling down in the latest release of the HBGI. The year-over-year moving average growth rate for four of the seven markets fell into negative territory. Large Metro – Outlying Counties, Micro counties and Non Metro/Micro counties all remained positive. Non Metro/Micro counties had the highest growth at 26.6% while Large Metro – Core Counties was the lowest at negative 10.6%.

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