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Manufactured Homes: An Alternative Means of Housing Supply

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Manufactured homes play a measurable role in the U.S. housing market by providing an affordable supply option for millions of households. According to the American Housing Survey (AHS), there are 7.2 million occupied manufactured homes in the U.S., representing 5.4% of total occupied housing and a source of affordable housing, in particular, for rural and lower income households.

Often thought of as synonymous to “mobile homes” or “trailers”, manufactured homes are a specific type of factory-built housing that adheres to the U.S. Department of Housing and Urban Development’s (HUD’s) Manufactured Home Construction and Safety Standards code. To qualify, a manufactured home must be a “movable dwelling, 8 feet or more wide and 40 feet or more long”, constructed on a permanent chassis.

The East South Central division (Alabama, Kentucky, Mississippi and Tennessee) have the highest concentration of manufactured homes, representing 9.3% of total occupied housing. The Mountain region follows with 8.5%, while the South Atlantic region holds 7.7%.

The 1990s saw a surge in manufactured home shipments, peaking in 1998. During this period, manufactured homes constituted 17% to 24% of new single-family homes.  However, shipments declined in the early 2000s, coinciding with a rapid increase in site-built housing construction leading up to the 2008 housing crisis. Since then, manufactured homes have stabilized at around 9% to 10% of new housing.

Characteristics of the 2023 Manufactured Home Stock

Given that most manufactured homes were produced in the 1990s, a significant portion of the existing manufactured home stock — approximately 72.2% — was built before 2000. Consequently, 7.7% of these homes are classified as inadequate compared to 5% of all homes nationwide. About 2% are considered severely inadequate and exhibit “major deficiencies, such as exposed wiring, lack of electricity, missing hot or cold running water, or the absence of heating or cooling systems”. However, with proper maintenance, manufactured homes can be as durable as site-built homes.

Currently, 57% of the occupied manufactured homes stock are single-section units, while 43% are multi-sections, according to the AHS. Single-section homes are manufactured homes that can be transported from factory to placement in a single piece while multi-sections are transported in multiple pieces and are joined on site. However, data from the Census show that newer shipments indicate a shift toward multi-section homes.

Most single-section homes are less than 1,000 square feet and contain five total rooms in the house — typically two bedrooms and three bathrooms. In contrast, multi-section homes usually range from 1,000 to 2,000 square feet and have six rooms, comprising three bedrooms and three bathrooms.

Demographics of Manufactured Homes Residents

Manufactured homes serve as a crucial housing option, particularly for those living in rural or non-metro areas. AHS data highlight a stark contrast between the locations of single-family and manufactured home residents. While most manufactured home residents (53%) live in rural areas, single-family residents are mostly concentrated (67%) in urbanized areas — defined as territories with a population of 50,000 or more. In comparison, only 33% of manufactured home residents reside in urbanized areas. Residents of both manufactured and single-family homes are less common in urban clusters — areas with populations between 2,500 and 50,000 — comprising just 13% and 9%, respectively.

The median age of a manufactured home householder is 55, the same as single-family householders. However, most manufactured home householders (37.8%) have an education attainment level of high school completion compared to single-family householders whose largest group (24.8%) have completed a bachelor’s degree.

Income disparities are also significant. The median household income for manufactured home residents is $40,000, far below the $85,000 median income for single-family householders. The gap widens among homeowners, with manufactured homeowners earning a median of $41,500 versus $93,000 for single-family homeowners.

Household CharacteristicManufactured Homes HouseholdSingle-Family HouseholdAge (Median)5555Majority Education Attainment LevelHigh school or equivalency (37.8%)Bachelor’s degree (24.8%)Annual Household Income (Median)$40,000$85,000Annual Household Income of Homeowners (Median)$41,500$93,000Sources: 2023 American Housing Survey (AHS) and NAHB analysis.

Cost of Buying and Owning Manufactured Homes

One of the key advantages of manufactured homes is affordability. The average cost per square foot for a new manufactured home in 2023 was $86.62, compared to $165.94 for a site-built home (excluding land costs) — a difference of $79.32 per square foot. This difference in cost has only grown over the decade from $51.84 per square foot in 2014. For a 1,500-square-foot home, this translates to a savings of approximately $118,980, and this savings has grown despite the average cost of manufactured homes increasing at a higher growth rate of 7.4% CAGR versus 6.1% CAGR for new single-family homes.

Owning a manufactured home is also more affordable in total housing cost, which includes mortgage payments, insurance, taxes, utilities and lot rent. According to the AHS, owners of a single-section manufactured home have a median total monthly housing cost of $563, while the cost for a multi-section home is $805. In contrast, the median monthly cost of owning a single-family home is $1,410.

Despite the lower costs associated with manufactured homes, affordability remains a challenge for many owners. Among single-section manufactured homeowners, 36.6% are considered cost-burdened, meaning they spend 30% or more of their income on housing. This is slightly higher than the 28.4% of multi-section manufactured homeowners and the 27.6% of single-family homeowners facing similar financial strain. This disparity underscores the reality that even though manufactured homes are a more affordable option, lower-income households are still disproportionately burdened by housing costs.

Manufactured Home Pricing

Data on manufactured home appreciation is limited. However, the Federal Housing Finance Agency (FHFA) publishes a quarterly house price index for manufactured homes. Comparing the indices for manufactured and site-built homes, manufactured homes have closely followed the appreciation trends of their site-built counterparts. Between the first quarter of 2000 and the last quarter of 2024, the index value for manufactured homes increased by a cumulative 203.7%, slightly surpassing the 200.2% increase for site-built homes. This indicates that the manufactured home markets face much of the same demand opportunities and supply challenges of the broader housing market.

It is important to note that this data reflects only manufactured homes financed through conventional mortgages as real property, acquired by Fannie Mae and Freddie Mac (the Enterprises). In contrast, the majority of new manufactured homes are titled as personal property, which is not eligible for conventional mortgage financing because the Enterprises do not acquire chattel loans. Nonetheless, it is common for manufactured homes to be placed on private land even though the unit is under a personal property title — a title that applies to movable assets, such as vehicles, tools or equipment, and furniture, whereas a real estate property title includes land and any structures permanently attached to it.

Despite this distinction, there has been a steady increase in the share of manufactured homes titled as real estate. Since 2014, the percentage of real estate-titled manufactured homes has grown from 13% to 20% in 2023, indicating a positive trend toward greater financial recognition and stability for these homes.

Zoning Restrictions and the Future of Manufactured Homes

Manufactured homes provide a cost-effective housing solution, particularly in rural areas where the transportation and material costs for site-built homes can be significantly higher. However, restrictive zoning laws often limit their placement in urban areas. Regulations such as bans on manufactured home communities and large lot size requirements can substantially increase costs, making it difficult to establish manufactured housing in cities. Reducing these zoning barriers could not only expand affordable housing options in high-cost urban areas but also improve access to essential services such as healthcare and economic opportunities for lower-income communities.

A successful example of zoning reform comes from Jackson, Mississippi, where city officials partnered with the Mississippi Manufactured Housing Association (MMHA) to launch a pilot program highlighting the potential of prefabricated and manufactured homes as affordable housing solutions. As part of the initiative, the city revised its zoning regulations to distinguish manufactured and modular housing from pre-1976 “mobile homes,” which had long been banned. Previously, manufactured homes were classified under the same category, restricting their placement. The new ordinance now permits manufactured housing within city limits, albeit with a discretionary use permit, paving the way for greater affordability and accessibility in urban housing.

Conclusion

Manufactured homes make up only 5% of the total housing stock but provide an alternative form of housing that meets the needs of various households, particularly in rural areas. Although they offer a lower-cost option compared with site-built homes, factors such as an aging housing stock, financing limitations and zoning restrictions could influence their accessibility and long-term viability.

Trends such as the increasing prevalence of multi-section homes and a growing share of units titled as real estate suggest a gradual shift in consumer preferences toward housing options that more closely resemble site-built homes in size, functionality and financing. As housing affordability remains a key concern, manufactured homes continue to play a role as an affordable supply in the broader housing landscape, and expanding their use through education, innovation and zoning reform could improve access to cost-effective housing.

Footnotes:

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Single-Family Built-for-Rent Construction Falls Back

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Single-family built-for-rent construction posted year-over-year declines for the fourth quarter of 2024, as a higher cost of financing crowded out development activity. This slowdown is similar to the deceleration of multifamily construction in recent quarters.

According to NAHB’s analysis of data from the Census Bureau’s Quarterly Starts and Completions by Purpose and Design, there were approximately 15,000 single-family built-for-rent (SFBFR) starts during the fourth quarter of 2024. This is 38% lower than the fourth quarter of 2023. Over the last four quarters (2024 as a whole), 83,000 such homes began construction, which is an 8% increase compared to the 77,000 estimated SFBFR starts in the four quarters prior to that period (2023 as a whole).

The SFBFR market is a source of inventory amid challenges over housing affordability and downpayment requirements in the for-sale market, particularly during a period when a growing number of people want more space and a single-family structure. Single-family built-for-rent construction differs in terms of structural characteristics compared to other newly-built single-family homes, particularly with respect to home size. However, investor demand for single-family homes, both existing and new, has cooled with higher interest rates.

Given the relatively small size of this market segment, the quarter-to-quarter movements typically are not statistically significant. The current four-quarter moving average of market share (8%) is nonetheless higher than the historical average of 2.7% (1992-2012).

Importantly, as measured for this analysis, the estimates noted above include only homes built and held by the builder for rental purposes. The estimates exclude homes that are sold to another party for rental purposes, which NAHB estimates may represent another three to five percent of single-family starts based on industry surveys.

The Census data notes an elevated share of single-family homes built as condos (non-fee simple), with this share averaging more than 4% over recent quarters. Some, but certainly not all, of these homes will be used for rental purposes. Additionally, it is theoretically possible some single-family built-for-rent units are being counted in multifamily starts, as a form of “horizontal multifamily,” given these units are often built on a single plat of land. However, spot checks by NAHB with permitting offices indicate no evidence of this data issue occurring.

With the onset of the Great Recession and declines for the homeownership rate, the share of built-for-rent homes increased in the years after the recession. While the market share of SFBFR homes is small, it has clearly expanded. Given affordability challenges in the for-sale market, the SFBFR market will likely retain an elevated market share. However, in the near-term, SFBFR construction is likely to slow until the return on new deals improves.

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A Pause for the Fed

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In a widely anticipated announcement, the Federal Reserve paused on rate cuts at the conclusion of its January meeting, holding the federal funds rate in the 4.25% to 4.5% range. The Fed will continue to reduce its balance sheet, including holdings of mortgage-backed securities. The Fed noted the economy remains solid, while specifying a data dependent pause. Chair Powell did qualify current policy as “meaningfully restrictive,” but the central bank appears to be in no hurry to enact additional rate cuts.

While the Fed did not cite the election and accompanying policy changes today, the central bank did note that its future assessments of monetary policy “will take into account a wide range of information, including readings on labor market conditions, inflation pressures, and inflation expectations, and financial and international developments.” Given the ongoing, outsized impact that shelter inflation is having on consumers and inflation, an explicit mention to housing market conditions would have been useful in this otherwise exhaustive list.

Chair Powell did state in his press conference that housing market activity appears to have “stabilized.” A reasonable assumption is that this is a reference to an improving trend for rent growth (for renters and owners-equivalent rent), but the meaning of this statement is not entirely clear given recent housing market data and challenges. While improving, shelter inflation is running at an elevated 4.6% annual growth rate, well above the CPI. These housing costs are driven by continuing cost challenges for builders such as financing costs and regulatory burdens, and other factors on the demand-side of the market like rising insurance costs. And more fundamentally, the structural housing deficit persists.

From the big picture perspective, the Fed faces competing risks for future policy given changes in Washington, D.C. Tariffs and a tighter labor market from immigration issues represent upside inflation risks, but equity markets have cheered prospects for an improved regulatory policy environment, productivity gains and economic growth due to the November election. These crosswinds may signal a lengthy pause for monetary policy as the Fed continually seeks more short-term data.

While the Fed targets short-term interest rates, long-term interest rates have risen significantly since September, as a second Trump win came into focus. A future risk for long-term interest rates and inflation expectations will be fiscal policy and government debt levels. Extension of the 2017 tax cuts will be good for the economy, but ideally these tax reductions should be financed with government spending cuts. Otherwise, a larger federal government debt will place upward pressure on long-term interest rates, including those for mortgages.

The January Fed statement acknowledged the central bank’s dual mandate by noting that it would continue to assess the “balance of risks.” There was no language in today’s statement pointing to a future cut, although markets still expect one or two reductions in 2025 if inflation remains on a moderating trend.

Importantly, the Fed reemphasized that it is “strongly committed to support maximum employment and returning inflation to its 2 percent objective.” That seemed like a shot across the bow for those speculating that the Fed might be satisfied with achieving an inflation rate closer to but not quite 2%. While there is merit to debating the 2% policy, the emphasis today on the 2% target is a reminder of how important the housing market and housing affordability is for monetary policy and future macroeconomic trends.

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Fed Cuts But Signals Slowing Pace of Easing Ahead

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In a widely anticipated move, the Federal Reserve’s Federal Open Market Committee (FOMC) reduced the short-term federal funds rate by an additional 25 basis points at the conclusion of its December meeting. This policy move reduces the top target rate to 4.5%. However, the Fed’s newly published forward-looking projections also noted a reduction in the number of federal funds rate cuts expected in 2025, from four in its last projection to just two 25 basis point reductions as detailed today.

The new Fed projection envisions the federal funds top target rate falling to 4% by the end of 2025, with two more rate cuts in 2026, placing the federal funds top target rate to 3.5% at the end of 2026. One final rate is seen occurring in 2027. Furthermore, the Fed also increased its estimate of the neutral, long-run rate (sometimes referred to as the terminal rate) from 2.9% to 3%, which is reflective of stronger expectations for economic growth and productivity gains.

For home builders and other residential construction market stakeholders, the new projections suggest an improved economic growth environment, one in which there is a smaller amount of monetary policy easing, leading to higher than previously expected interest rates for acquisition, development and construction (AD&C) loans. Thus, more economic growth but higher interest rates.

The statement from the December FOMC summarized current market conditions as:

Recent indicators suggest that economic activity has continued to expand at a solid pace. Since earlier in the year, labor market conditions have generally eased, and the unemployment rate has moved up but remains low. Inflation has made progress toward the Committee’s 2 percent objective but remains somewhat elevated.

The Fed’s broader economic projections generally experienced positive revisions. The central bank lifted its forecast for GDP growth in 2025 to 2.1%. It sees the unemployment rate at 4.3% at the end of 2025, down from 4.4%.

However, the Fed also increased its inflation expectations. The central bank now sees 2.5% core PCE inflation at the end of 2025, up from its prior projection of 2.1%. While long-run expectations of the FOMC remained anchored at the 2% inflation target, the increase for the 2025 expectation for inflation is the reason for taking two rate cuts off the table for 2025, leaving just two remaining in the forecast.

Despite 100 basis points of easing for the short-term federal funds rate since September, long-term interest rates (which are set by markets and investors), including mortgage rates, have increased. This reflects market expectations of firmer inflation and a slower path for monetary policy easing. Policy concerns over government deficits and perhaps tariffs are also affecting investor outlooks. The size of the government deficit will be key for future inflation and long-term interest rates, particularly given a significant debate on taxes and government spending set for the start of 2025. And the slower path of monetary policy easing pushed the 10-year Treasury rate to 4.5%.

The pace of overall inflation is moving lower albeit slowly. Shelter inflation continues to be a driver of overall inflation, with gains for housing costs responsible for 65% of overall inflation over the last year. This kind of inflation can only be tamed in the long-run by increases in housing supply. Fed Chair Powell has previously noted it will take some time for rent cost growth to slow although it is moving lower. Given recent tight financing conditions, however, the Fed noted that while consumer spending is resilient, “…activity in the housing sector has been weak.” A slower path of Fed rate cuts for 2025 will keep builder and developer construction loan interest rates higher than previously expected and act as an additional headwind for gains in housing supply.

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Gains for Townhouse Construction

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Year-over-year gains for townhouse construction continued during the third quarter of 2024 as demand for medium-density housing continues to be solid despite slowing for other sectors of the building industry.

According to NAHB analysis of the most recent Census data of Starts and Completions by Purpose and Design, during the third quarter of 2024, single-family attached starts totaled 47,000, matching the highest quarterly count for townhouse construction since mid-2006. Over the last four quarters, townhouse construction starts totaled a strong 177,000 homes, which is 20% higher than the prior four-quarter period (148,000). Townhouses made up 18% of single-family housing starts for the third quarter of the year, a data series high.

Using a one-year moving average, the market share of newly-built townhouses stood at 17.4% of all single-family starts for the third quarter. With recent gains, the four-quarter moving average market share remains at the highest on record, for data going back to 1985.

Prior to the current cycle, the peak market share of the last two decades for townhouse construction was set during the first quarter of 2008, when the percentage reached 14.6%, on a one-year moving average basis. This high point was set after a fairly consistent increase in the share beginning in the early 1990s.

The long-run prospects for townhouse construction are positive given growing numbers of homebuyers looking for medium-density residential neighborhoods, such as urban villages that offer walkable environments and other amenities. Where it can be zoned, it can be built.

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Student Housing Construction Investment Rises in the Third Quarter of 2024

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Private fixed investment in student dormitories increased by 2.2% to a seasonally adjusted annual rate (SAAR) of $3.9 billion in the third quarter of 2024. This rise follows a 7% decrease in the prior quarter. However, private fixed investment in dorms was 1.8% lower than a year ago, as the elevated interest rates place a damper on student housing construction.  

Private fixed investment in student housing experienced a surge after the Great Recession, as college enrollment increased from 17.2 million in 2006 to 20.4 million in 2011. However, during the pandemic, private fixed investment in student housing declined drastically from $4.4 billion (SAAR) in the last quarter of 2019 to a lower annual pace of $3 billion in the second quarter of 2021, as COVID-19 interrupted normal on-campus learning. According to the National Student Clearinghouse Research Center, college enrollment fell by 3.6% in the fall of 2020 and by 3.1% in the fall of 2021.  

Since then, private fixed investment has rebounded, as college enrollments show a slow but stabilizing recovery from pandemic driven declines. Effective in-person learning requires college students to return to campuses, boosting the student housing sector. Furthermore, the demand for student housing is growing robustly, because total enrollment in postsecondary institutions is projected to increase 8% from 2020 to 2030, according to the National Center for Education Statistics. 

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Share of Young Adults Living with Parents by Congressional District

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Building on the post-pandemic trend, the share of young adults (aged 25-34) living with their parents fell to a decade low, according to NAHB analysis of 2022 American Community Survey (ACS) Public Use Microdata Sample (PUMS). However, young adults continue to face difficult decisions about their living arrangements due to elevated home prices and increasing costs of living. While some young people established independent households during the pandemic, according to 2023 ACS data, many young adults continue to live with their parents in higher-cost areas, with variations across states and congressional districts.

In general, the share of young adults (aged 18-34) living with parents positively correlates with housing costs, particularly in coastal areas. This trend reflects young adults’ increasing financial burdens as both rents and home prices surge. A previous post demonstrated that more than half of renter households spend 30% or more of their income on housing, suggesting that affordability issues may delay young adults’ independence and path to homeownership.

In 2023, 31.8% of young adults (aged 18-34) lived with their parents at the national level using 2023 ACS data. Across congressional districts, the share of young adults living with parents varies significantly, reflecting different local housing affordability challenges. The shares are generally higher than the previous study, as this analysis includes adults aged 18-24. The top five congressional districts with the highest shares of young adults living with parents are located in areas with high housing costs and limited rental options. These districts include:

New York, District 3, 58.6%

New York, District 4, 56.5%

New York, District 1, 56.5%

California, District 38, 54.0%

New Jersey, District 5, 53.4%

In contrast, the bottom five congressional districts with the lowest shares of young adults living with parents are in major cities known for high housing costs, low homeownership rates and robust rental markets. As rental options provide more independence, a higher share of renter households in California, New York and Washington appears to be associated with fewer young adults living with parents. The bottom five districts include:

New York, District 12, 8.4%

Texas, District 37, 9.6%

California, District 11, 11.6%

Washington, District 7, 11.7%

District of Columbia, At Large, 12.2%

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Mortgage-Free Homeowners by Congressional Districts

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As of 2023, nearly 40% of homeowners in the United States are mortgage-free, the highest level seen in the past 13 years. With elections approaching, it is valuable to analyze the share of mortgage-free homeowners across congressional districts, as these patterns often provide insights into the local housing market as well as demographic shifts.

Both the number and the share of homeowners without mortgages have steadily increased since 2010, according to the 2023 American Community Survey. In 2010, around 32.8% of homeowners, or 24.5 million households, were mortgage-free. By 2023, this number had increased to 39.8% of homeowners, with 34.1 million homeowners having fully paid off their mortgages. Over the past 13 years, the share of mortgage-free homeowners has reached a record high level.

Older homeowners are more likely to have fully paid off their mortgages. In 2023, two-thirds of the mortgage-free homeowners are baby boomers aged 60 years and over. In contrast, only 5% of mortgage-free homeowners are under 35 years old, 8% are between 35 and 44 years old, 11.9% are aged 45 to 55, and 8.9% are between 55 and 59.

The share of mortgage-free homeowners varies substantially across the congressional districts. Districts with more affordable housing or a higher proportion of older populations tend to have a higher percentage of mortgage-free homeowners. The top 5 congressional districts for mortgage-free homeownership are primarily located in Southern states such as Texas, West Virginia, Kentucky, Mississippi, where lower housing costs or favorable weather attract older residents. As of 2023, Texas’s 34th district had the highest share of mortgage-free homeowners in the nation. Following closely, West Virginia’s 1st district had 61.2% of homeowners living mortgage-free, while Kentucky’s 5th district had a mortgage-free rate of 60.2%, Mississippi’s 2nd district had 58.7%, and Texas’s 29th district had 56.7%.

In contrast, districts with younger populations, higher levels of urbanization and less affordable housing tend to have lower shares of mortgage-free homeowners. The five congressional districts that struggle the most with low rates of mortgage-free homeowners include Maryland’s 5th district (20.8%), Virginia’s 10th district (22.6%), the District of Columbia’s Delegate District at Large (22.7%), Virginia’s 7th district (22.6%) and California’s 37th district (20.8%).  

Additional housing data for your congressional district are provided by the US Census Bureau here.

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Homeownership Rates for Young Adults

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With housing affordability at a multidecade low, housing costs have become a major issue in the 2024 presidential election. While NAHB reports the national homeownership rate from the Census Bureau’s Housing Vacancy Survey on a quarterly basis, examining characteristics across congressional districts provides valuable insights.

A recent NAHB analysis of 2023 American Community Survey shows about two-thirds (65.2%) of US households are homeowners, yet there are forty congressional districts where renters represent the majority. Another NAHB post found that in the second quarter of this year the homeownership rate for households under the age of 35 has dropped to its lowest level in four years, as higher mortgage rates and low inventory have made affordability a bigger challenge for first-time buyers. As the largest cohort of millennials reach peak homebuying years, it is important to take a closer look at homeownership rate for those under age 35. This post will focus on comparing the homeownership rates of young adults (under 35) across congressional districts using 2023 ACS data.

The map below illustrates variation in young adults’ homeownership rates across congressional districts, ranging from 5.2% to 65.6%. In general, young adults’ homeownership rates tend to follow a distinct pattern with respect to the overall homeownership rate, particularly in the top five districts with the highest homeownership rates and the bottom five with the lowest.

Table 1 shows that the top five districts with the highest young adults’ homeownership rate also have overall homeownership rate above 80%. However, the share of young adults in the top two districts is relatively low. In New York’s 1st and 4th district, 65% of young adults are homeowners, but they only make up only 8.9% and 9.8% of the overall population. Following that, Michigan’s 9th and 2nd districts have the third and fourth highest young adults’ homeownership rates above 60%.

Table 1Congressional DistrictYoung Adults Homeownership RateOverall Homeownership RateYoung Adults Share of PopulationNew York, District 165.6%83.8%8.9%New York, District 465.2%80.7%9.8%Michigan, District 965.2%84.9%14.1%Michigan, District 261.0%82.4%17.3%Maryland, District 559.3%81.7%13.2%

Table 2 shows the bottom five districts with the lowest young adult homeownership rates. Like the top five districts, those with the lowest young adult homeownership rates also tend to have lower overall homeownership rates. Among the bottom 15 districts, most are in New York and California, with only the 15th lowest in Washington, D.C. The West coast, in general, tends to have lower homeownership rates.

Table 2Congressional DistrictYoung Adults Homeownership RateOverall Homeownership RateYoung Adults Share of PopulationNew York, District 135.2%12.8%20.4%California, District 347.5%22.0%24.8%New York, District 157.9%15.9%18.3%New York, District 78.2%22.0%33.0%California, District 308.7%30.1%24.4%

Among fifty States and the District of Columbia, New York has congressional districts with both the highest and lowest homeownership rates. This mirrors the findings of overall homeownership rate in our previous post. The highest young adults’ homeownership rate is in New York’s 1st district, while the lowest is in New York’s 13th district.

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Second Homes by Congressional Districts

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In 2023, the total number of second homes was 5.7 million, accounting for 4% of the total housing stock, according to NAHB estimates of the 2023 American Community Survey. Second homes have been in a steady decline over the past few years, from 7.15 million in 2020, to 6.5 million in 2022, dropping to 5.7 million in 2023.

The distribution of second homes across the U.S. reveals important geographic patterns, particularly when examined at the congressional district level. This analysis focuses on the number and the location of second homes qualified for or defined by the home mortgage interest deduction using the Census Bureau’s 2023 American community Survey (ACS). It does not account for homes held primarily for investment or business purposes.

Half of the nation’s second homes are concentrated in a small number of congressional districts, primarily in these states: Florida, California, New York, Texas, Michigan, North Caroline, Pennsylvania, and Arizona. Florida alone accounted for 15.8% of all second homes, with 16 out of its 28 congressional districts having more than 25,000 second homes each. Florida’s 19th Congressional District had the largest stock of second homes, with 123,853 units. In contrast, Wyoming’s At Large Congressional District had the smallest stock, with 17,623 second homes.

Analysis of congressional district data shows that second homes are not just concentrated in conventional coastal and resort areas. Second homes make up a significant portion of the housing stock in various districts across the country. Michigan’s 1st Congressional District had the highest share of second homes, with 24.5% of its housing stock qualified as second homes. Wisconsin’s 7th Congressional District had 82,755 second homes, almost 20% of its total housing stocks.

While some congressional districts have a higher percentage of second homes, many other congressional districts also show a notable prevalence of second homes. In 2023, 32 congressional districts in 17 states had at least 10% of housing units that were second homes. Of these congressional districts, 8 congressional districts were in Florida, 4 in New York, 3 in California, and 2 in Maine, Michigan, North Carolina, and 1 congressional district each in Arizona, Colorado, Hawaii, Maryland, Massachusetts, Minnesota, New Jersey, Pennsylvania, South Carolina, Vermont, Wisconsin.

NAHB estimates are based on the definition used for home mortgage interest deduction: a second home is a non-rental property that is not classified as taxpayer’s principal residence. Examples could be: (1) a home that used to be a primary residence due to a move or a period of simultaneous ownership of two homes due to a move; (2) a home under construction for which the eventual homeowner acts as the builder and obtains a construction loan (Treasury regulations permit up to 24 months of interest deductibility for such construction loans); or (3) a non-rental seasonal or vacation residence. However, homes under construction are not included in this analysis because the ACS does not collect data on units under construction.

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