Residential Construction Expanding Rapidly in Lower Density Markets

According to the latest National Association of Home Builders (NAHB) Home Building Geography Index (HBGI), residential construction activity is expanding at a more rapid pace in lower density markets, such as smaller cities and rural areas. As pointed out in the HBGI, one of the lessons of the COVID-19 pandemic health crisis is that major metropolitan areas faced greater challenges. As measured on a one-year moving average, the HBGI found that even before the pandemic, home construction activity was increasing at a higher rate in inner and out suburbs, rather than in high-density markets. With the strongest growth rate (9.1%) being found in outlying suburbs (“exurbs’) of small metro areas.