Data from the U.S. Census Bureau’s Survey of Construction (SOC), with analysis provided by the National Association of Home Builders (NAHB), reveals that the custom home share decreased to 17.8% of all single-family homes started in 2020. That is the lowest annual custom home share has been since the redesigning of the SOC in 2005.
The custom home market consists of contractor-built and owner-built houses — homes built one at a time for owner occupancy on the owner’s land, with either the owner or a builder acting as a general contractor. The alternatives are homes built for sale (on the builder’s land, often in subdivisions, with the intention of selling the house and land in one transaction) and homes built for rent.
In 2020, 77.1 percent of homes started were built for sale, and 5.2 percent were built for rent. Analysis of annual data from the 9-Census Bureau Divisions show that the highest custom home share in 2020 was 44.4% was in the Middle Atlantic Division. In comparison, South Atlantic Division share was only 10.8%.
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Custom Home Building Share Declines