Single-family home growth rates fell in nearly all regional submarkets in the first quarter of 2022 compared with the same period last year, the National Association of Home Builders reported.
The slowdown was due mainly to rising construction costs, as building material costs surged 19% year-over-year.
“The more pronounced drop in growth for the large suburban markets is due to the easing of the rapid shift of home buyer preferences for the suburbs in the aftermath of the COVID-19 pandemic,” NAHB Chief Economist Robert Dietz stated.
“As the year has progressed, we have seen signs of an increasing slowdown in the single-family market,” added NAHB Chairman Jerry Konter. “Ongoing building material production bottlenecks have delayed or stalled home building projects, construction labor shortages are running near an all-time high of 400,000 workers and more recently the rapid runup in mortgage rates have all combined to exacerbate the housing affordability crisis.”
Multifamily home construction, including apartment construction, far outpaced single-family building in the first quarter. “Low rental occupancy rates and rising rents give multifamily developers confidence to continue building despite rising costs for land, labor and materials,” Dietz stated.
The full NAHB report can be found here.
