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Apr 12, 2019

Housing Trends

Nearly 50% Of New Home Projects Are Attached In What Region?

Builders, architects, and consultants are working on solutions to address today’s housing affordability challenges. Shifting product type does not always seem like a desirable option, but flexible land planning, creative compromises, and well-thought-out density can make for a successful project. Zonda shows where product availability changed the most over the past few years.

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Regional Differences 

The affordability problem for US housing is not solved just because price appreciation is slowing and mortgage rates are down to 4.0%. In fact, less than 50% of US households can afford the median-priced new home, and in LA, for example, the number is just 12%.

While attainability is not a new concern, builders got (particularly) serious in late-2016 and 2017 about solutions, whether through smaller homes, building in secondary or tertiary markets, and/or shifting to more attached product. Some of today’s communities are bearing the fruit of the strategy pivot 24 months ago:

Northeast and Southern California have the most attached product. Nearly 50% of the new home projects are attached in the Northeast, up from 43% in 2016. In contrast, Southern California’s attached offerings are the second highest nationally but at a much lower share of the market, representing 30%, up from 20% in 2016.

West sees the fastest growth. Attached product has gained popularity in the Northwest, Northern California, and the Southwest, increasing by roughly 40%+ each since 2016. One in five actively selling communities in the three regions are attached. 

Texas adjusts product in different ways. Attached new home communities in Texas represent 7% of the market, flat from 2017 and 2018. Builders in Texas are facing affordability problems unlike in the past, but in many cases, solutions mean moving from 80′ product (lot frontage) to 60′ and 50′. 

Product Mix And Sales

When asked, consumers overwhelmingly prefer single-family detached homes to attached product, but actions and words are sometimes misaligned when the pricing reality sets in. Buyers are increasingly open to denser neighborhoods to help hit a lower price or to be positioned in a good neighborhood. Attached new home communities increased by 16% on average nationwide from 2016 to 2019. 

Attached product doubled as a share of overall in one market. Attached offerings as a percent of total communities in Charlotte doubled in three years to 17%. Of the 15 best-selling communities over the past three months, two are attached in Charlotte with an average sales rate over eight per month.

Markets are adapting. Attached product also gained a sizable share in Atlanta (21% of the market), Seattle (19%), Salt Lake City (22%), and Las Vegas (12%). In Seattle and Salt Lake City, 50% of the best-selling new home communities over the past three months were attached.

Low supply, low action. Attached offerings are scarce in San Antonio (1% of the actively selling projects), Dallas (4%), Columbus (4%), Austin (6%), Sacramento (6%), and Riverside-San Bernardino (6%). Unsurprisingly, none of these have attached communities in the top 15 best-selling except Columbus and Riverside.

In Columbus, the only attached product to make the top 15, The Enclave At Adalee by Ryan Homes, is actually the #1 best-selling community in the entire metro. The two in Riverside are in Rancho Cucamonga in the $400,000s.

Outsized sales for attached product. In some markets, there’s a big spread between the percent of attached product in the market and the percent of the best-selling communities that are attached. For example, while Seattle’s attached share is only 19% of the market, 53% of the best-selling communities fall under that product type.

A similar trend is occurring in Miami, Salt Lake City, Washington, DC, and Minneapolis. The data suggests that if more well-executed, well-positioned attached product hits these markets, the denser communities would be well-received.

Detached still king in Phoenix. On the flip side, 13% of Phoenix’s market is attached, but there are 46 best-selling detached communities before an attached one makes the list.

Contact us to better understand your market.

Featured Writers

We cover topics around housing, policy, markets, and technology.

Ali Wolf

Director, Economic Research

Ali Wolf

Director, Economic Research


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