Share of US Custom Built Homes Declined in 2023

According to the US Census Bureau’s Survey of Construction, with additional analysis provided by the National Association of Home Builders (NAHB), 18.8% of all new single-family homes started in 2023 were custom homes. This share is down from 20.4% in 2022.

The custom home market consists of contractor-built and owner-built homes—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 2023, 71.5% of the single-family homes started were built-for-sale, and 9.7% were built-for-rent. At an 18.9% market share, the number of custom homes started in 2023 was 177,850, falling from 207,472 in 2022.

Quarterly statistics show that the custom home share of single-family starts showed gains in 2024Q2 after some recent slowing. Although the quarterly statistics are timelier, they lack the geographic detail available in the annual data set.

NAHB notes that when analyzed across the 9 census divisions, the annual data show that the highest custom home share in 2023 was 35.5% in the East South-Central division. The lowest share was in the West South-Central division: only 11.9%. The share of custom homes across US divisions can be found in the original source.