Home Builders Cut Construction Time by 10-days in 2020

According to the U.S. Census Bureau’s 2020 Survey of Construction (SOC), with analysis provided by the National Association of Home Builders (NAHB), the average completion time of a single-family house was around 7.8 months, which typically includes a little over a month from authorization to start and another 6.8 months to finish the construction. It took approximately 10 days less in 2020 when compared to 2019, pausing the upward trend started in 2014. The time from authorization to completion varies across the nation and depends on the geographic location, and whether the house is built for sale or custom-built. The data make it clear that builders stepped up the pace of construction to meet rising demand in 2020. However, based on NAHB surveys, we expect this time to expand for 2021 completions given ongoing supply-chain issues. Single-family homes built-for-rent began construction within the same month after obtaining building authorizations. The other types, including custom homes built for sale, built by owners serving as general contractors and built by contractors on owner’s land, had one month or a little over one-month lag between obtaining permits and the start of construction. The average time from authorization to completion also varied greatly across regions. The division with the longest duration was the Middle Atlantic (11.6 months), followed by New England (11.6 months), the Pacific (10.0 months), and the East South Central (9.1 months) in 2020. These four divisions had average time from permit to completion exceeding the nation’s average (7.8 months). The shortest period, 6.6 months, is registered in the South Atlantic division. The average waiting period from permit to construction start varies from the shortest time of 20 days in the Mountain to the longest one of 49 days in Pacific.