Single-family construction on the rise while multifamily development drops

The demand for single-family homes is rising, while the oversaturation of multi-family homes slows development. The National Association of Home Builders confirms the year-over-year growth for the single-family market, with the increase in Q2 adding to the gains posted in Q1. The new building permit count measures the development of both markets.

The U.S. West leads the multifamily decline with a 42% decrease in permits for that sector, closely followed by the Northeast and Midwest. 

The Builders’ Association reports that more than 900,000 apartments are currently under construction in the U.S., marking the most since 1973. With that comes a recent decrease in multifamily permits after a boom that sparked during the pandemic. The slowdown in permits can also be attributed to more stringent financing for multifamily home buyers.

According to CoStar analytics, multifamily permits dipped by 63% to 67,000 over the prior 12 months. Development dipped even further to 58,000 units in the following quarter, making it the lowest quarterly total since 2011. 

The builder’s group noted that single-family and multifamily construction companies are sifting through labor shortages and supply chain issues. Increases in mortgage rates in recent years have sliced the demand from new buyers. The Federal Reserve has signaled a decrease in mortgage rates this month, but there’s no indication that multifamily permits will see an increase soon. 

The single-family construction market appears to be stable in demand due to lower mortgage rates.

1 comment

Share Your Thoughts

How to become a plumber in 5 simple steps

July 3, 2025

From training to certification, find out how to become a plumber, how much it costs, salary ranges, and your career outlook in the U.S.

Read more

The health benefits of yoga for construction workers

July 2, 2025

Yoga increases strength, flexibility, and reduces pain for construction workers. Try vinyasa, hatha, ashtanga, or yin yoga.

Read more

The best fruits for a natural energy boost (ranked)

July 2, 2025

Medjpool dates and Mango make our list of best fruits for a natural energy boost improving focus and stamina for a heavy workday.

Read more

Tia Perry and AEC Unites: Empowering Black professionals in construction

July 2, 2025

Learn how Tia Perry & AEC Unites work to create opportunities for Black professionals and Black-owned businesses in this interview.

Read more