The demographic shift from single-family to multifamily housing
Abstract: The crash of the U.S. housing market triggered the worst U.S. recession since the 1930s. Beginning in late 2009, multifamily construction rebounded strongly. Beginning in mid-2011, single-family construction began to rebound as well. But during the first half of 2013, growth of both types of construction paused. Rappaport examines the demographic forces shaping demand for residential construction. At the end of 2012, the number of occupied single-family housing units was moderately below its demographic trend level and the number of occupied multifamily housing units was considerably below its demographic trend level. Hence residential construction of both types is likely to pick up in the near future. Over the longer term, slowing U.S. population growth is likely to put downward pressure on both types of construction. Downsizing by aging baby boomers will exacerbate this downward pressure on single-family construction but offset it for multifamily construction. Hence the long-term outlook is considerably stronger for multifamily construction.
File format is application/pdf
Description: Full text
Provider: Federal Reserve Bank of Kansas City
Part of Series: Economic Review
Publication Date: 2013
Issue: Q IV