The missing middle construction sector includes development of medium-density housing, such as townhouses, duplexes and other small multifamily properties.
The multifamily segment of the missing middle (apartments in 2- to 4-unit properties) has disappointed since the Great Recession. For the first quarter of 2023, there were just 43,000 2- to 4-unit housing unit construction starts. This is down 25% from a year prior.
As a share of all multifamily production, 2- to 4-unit development was just above 6% of the total for the first quarter. In contrast, from 2000 to 2010, such home construction made up a little less than 11% of total multifamily construction. Construction of the missing middle has clearly lagged during the post-Great Recession period and will continue to do so without zoning reform focused on light-touch density.
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