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Single-family construction saw a decline across the U.S. in the second quarter of 2025, according to an analysis by the National Association of Home Builders (NAHB). A 3.8% drop was reported in large metro, suburban counties, the largest decrease of any region.
“Single-family production continues to lag behind last year’s levels due to housing affordability challenges, including persistently high mortgage rates, the skilled labor shortage and excessive regulatory costs,” says NAHB chairman Buddy Hughes, a homebuilder and developer from Lexington, North Carolina. “Policymakers at all levels of government need to improve the business climate so that builders can build more homes by eliminating unnecessary regulations, promoting careers in the skilled trades and overturning inefficient zoning rules.”
According to the NAHB Home Building Geography Index (HBGI), most markets posted multifamily growth in Q2 of 2025.
“Multifamily market conditions remain stronger than expected, as single-family homeownership sits well out of reach for many households,” says NAHB chief economist Robert Dietz. “Favorable construction dynamics in low population density areas, such as lower regulation and land costs, have boosted multifamily construction in smaller markets while the high-density areas have seen construction declines.”
The HBGI registered declines for different-sized single-family markets in Q2, except micro counties, which posted a 1.8% gain, marking the fifth straight quarter of construction growth in these counties.
For multifamily construction, small metro outlying counties recorded a 22.1% increase, while higher density areas struggled, with large metro core counties reporting a decrease of 12.3%. Affordability conditions in the single-family market remain at dangerous levels, causing the demand for new multifamily construction to increase.
