The market shares of single-family and multifamily home building in rural submarkets, as defined by NAHB’s Home Building Geography Index (HBGI), increased year-over-year in the fourth quarter of 2021. The HBGI defines rural areas to include “micro counties” and “non-metro/micro counties,” which account for 8.4% and 5.6% of the total U.S. population, respectively.
Until the third quarter of 2021, single-family home building’s rural market share was consistent with the market shares maintained since 2017, 10.1%. In the third and fourth quarters, it posted quarterly gains of 0.2 percentage points, ending the year at 10.5%. In the fourth quarter of 2020, the share was 10.0%. Single-family home building’s growth rate in the fourth quarter of 2021 in rural counties was 15.9% on a four-quarter, moving average year-over-year basis. Its components, micro counties and non-metro/micro counties grew by 22.8% and 19.5%, respectively, by the same measure.
Multifamily home building’s rural market share gains in 2021 were unprecedented in the HBGI, reaching its largest market share on the HBGI’s record of 6.1% in the fourth quarter. In the fourth quarter of 2020, it was 4.6%. Rural multifamily home building market shares have shown more volatility in general than their single-family counterpart. Relative to all submarkets, micro counties’ market share of 4.1% in the fourth quarter of 2021 was twice that of non-metro/micro counties. In micro counties, permit issuances almost doubled, resulting in a growth rate of 91.2%. Rural market’s overall growth rate in multifamily home building was 71.0%.
