Single-Family Construction Ends 2024 With Growth; Greater Uncertainty for 2025

(Illustration courtesy of NAHB)

A lack of existing home inventory boosted single-family construction growth in all geographic regions to end 2024, according to the National Association of Home Builders Home Building Geography Index for fourth-quarter 2024.

“Single-family housing construction ended the year with growth as a shortage of existing homes for sale continues to increase demand for newly built homes,” said Buddy Hughes, a home builder and developer from Lexington, N.C. who serves as NAHB’s chairman.

Hughes noted that multifamily construction was “lackluster” in high-density areas, “while construction in smaller counties continued to grow and gain market share.”

NAHB Chief Economist Robert Dietz said single-family construction has held steady despite elevated mortgage rates and tight lending standards for construction and development loans. “Upside and downside risks will become clearer as the new year progresses. An easing regulatory environment and tax cuts could act as tailwinds but tariffs and potentially higher deficits could dampen market momentum,” he said. “Additionally, A growing trend away from work-from-home could increase building activity in inner suburbs in the quarters ahead.”

The index measures building conditions across the country and uses county-level information about single- and multifamily permits to gauge housing construction growth in various urban and rural geographies.