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Custom Home Building Fared Better Than Overall Market in Second Quarter

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Custom Builder

Custom Home Building Fared Better Than Overall Market in Second Quarter


August 19, 2020
Tablet with custom home project plans
Photo: Andy Dean

Custom home building performed better than the overall building market in the second quarter of 2020, according to NAHB. Single-family housing starts dropped off by 11% in the second quarter compared to last year while custom home building starts dropped only by 6%. Total starts hit 45,000 while 2019’s second quarter had 48,000. What constitutes a custom home build for this data are any homes with custom work not intended for sale. Though the numbers show a decline in building, custom housing for the last four quarters increased by 5% compared to the prior four year quarter total.

As measured on a one-year moving average, the market share of custom home building in terms of total single-family starts is now 20%, down from a cycle high of 31.5% set during the second quarter of 2009. However, due to the construction volume of the second quarter, the quarterly market share increased to 21%. It worth noting that the custom building share also increased in the wake of the Great Recession, and that custom builds are more likely to occur in low density markets.

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