Custom home building conditions flat, NAHB says

Custom Home Building
Custom Home Building

Analysis by the National Association of Home Builders based on Census Data from the Quarterly Starts and Completions by Purpose and Design survey indicates that the building of custom homes was effectively flat over recent quarters.

There were 49,000 total custom starts for the second quarter of 2019. This was down slightly compared to the second quarter of 2018 (50,000). Over the last four quarters, custom housing starts totaled 169,000. This was a 1.7% decline compared to the prior four quarters (172,000). Note that this definition does not include homes intended for sale, so the analysis uses a narrow definition of the sector.

As measured on a one-year moving average, the market share of custom home building in terms of total single-family starts is now  20%, down from a cycle high of 31.5% set during the second quarter of 2009.

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A March report also showed flat conditions. At the time, NAHB said, declines in market share were due to an acceleration in overall single-family construction, especially in spec home building. As this part of the market cools due to declining affordability, the market share for custom homes will likely stabilize, NAHB added.

Read more at NAHB’s Eye on Housing blog.

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