The pace of homebuilding in areas with the shortest commute times outpaced that of locations with longer commutes during the first quarter, the National Association of Home Builders said, citing its quarterly Home Building Geography Index. 

Longer-commute areas, like the suburbs and exurbs, continued to claim the largest market share in single-family home building, but the construction growth rate was strongest in places with shorter commuting times. 

“The first quarter HBGI indicates that home building not only continued to overperform in lower cost markets like suburbs and exurbs, but also expanded the most rapidly for single-family and multifamily construction in areas with the shortest commutes,” NAHB chief economist Robert Dietz said in a release.  “As workplaces increasingly adopt hybrid work models for roughly 30-40% of the American workforce, renters and buyers will have increased market power to minimize travel times and reduce both housing and transportation cost burdens.” 

The index also shows that the suburban shift in new home construction to low-density, low-cost markets that began with the start of the pandemic has continued.  

Counties with the longest commute times lost market share in the multifamily sector, while areas with the shortest commutes gained ground. 

“With the shift to telework brought on by the COVID-19 pandemic, housing demand continued to show the strongest gains in lower density markets in the first quarter as people have flexibility to live further out and even outside some metro areas,” NAHB Chairman Chuck Fowke said.  “Given the regulatory burdens and lack of lots in higher density, higher cost markets, builders are better able to meet demand in suburban, exurban and rural areas because of the lower cost to build.”