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Principia analysis shows COVID-19’s impact on residential construction

Malvern, Pennsylvania — Principia Consulting has initiated COVID-19 coverage to track and calibrate the impact of the coronavirus on residential construction down to the zip code level. In a recent update, Principia provided interactive views of the rapidly changing market for new home construction. Future updates will also include remodeling and repair and specific building product category impacts from the coronavirus. This analysis is fluid, Principia says, and will continue to evolve as COVID-19 progresses throughout the country and government restrictions are added or lifted.

Cities and states throughout the country are issuing stay-at-home (SAH) and shelter-in-place (SIP) ordinances specifying which businesses, including construction, are essential and non-essential. These ordinances are having an ongoing effect on construction activity and building products demand.

The United States was projected to build 2.7 billion square feet of new residential construction in 2020 prior to the impact of COVID-19. A complete review of the ordinances enacted to date shows the impact on construction activity by geography and the potential influence on building product demand and distribution. A few major takeaways include:

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• 51% of projected construction activity in municipalities is not currently under any legal restriction
• 12% of projected construction is currently under SAH/SIP restrictions with no exempt
• 65% of multifamily housing falls within the most affected areas

Currently the United States’ top three Census divisions South Atlantic, West South Central and Mountain by volume are relatively less affected. 65% of projected new construction in these divisions is in municipalities with no current ordinance

Major areas of the projected new construction in the United States fall within municipalities that are not affected by SAH/SIP ordinances. Clusters of unaffected high-volume areas can be found on Mid-Atlantic Coast (Carolinas and Virginia), and Desert (Arizona and Utah). Most affected areas are currently along the Pacific Coast, North Atlantic Coast, and Great Lakes regions.

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*Data as of March 26, 2020

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