Demand for Higher Density Development Appears to be Waning
Washington, D.C. -- Recent gains in demand for infill development and other factors associated with community accessibility appear to be moderating. Showing signs of market saturation, demand for walkable neighborhoods, multi-generational housing, and access to public transportation remain very strong, but growth has leveled off, according to the findings from the American Institute of Architects (AIA) Home Design Trends Survey for the third quarter of 2017, which focuses on community and neighborhood design.
“Intense development pressure on urban neighborhoods seems to be tapering as more development swings back to suburban and exurban locations,” said Kermit Baker, PhD., AIA chief economist “Though homeowners still desire access to community amenities, these results reflect a slowing of migration toward more dense neighborhoods. Homeowner priorities remain consistent, with low maintenance building materials topping the home exterior features list.
The AIA Home Design Survey Index for Q3 2017 indicated billings with a score of 58 and new project inquiries at a 59 (any score above 50 is positive). By region, the scores were Midwest (60.0), South (59.4), Northeast (56.9), West (56.1).
Baker added, “Business conditions at residential architecture firms remain strong across all regions, with improvements to existing homes continuing to top the list for specific residential sectors.”
AIA also recently reported the November ABI score was 55.0, up from a score of 51.7 in the previous month. This score reflects an increase in design services provided by U.S. architecture firms. The new projects inquiry index was 61.1, up from a reading of 60.2 the previous month, while the new design contracts index rose slightly from 52.8 to 53.2.
By region, the averages were West (54.8), Northeast (52.8), South (52.8), Midwest (50.4); and by sector, the index broke down as follows: multi-family residential (53.9), mixed practice (53.6), commercial/industrial (53.3), institutional (52.4). Project inquiries scored 61.1 and design contracts scored 53.2.
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