Best Year for Multifamily Missing Middle Construction Since 2007

Although not a huge jump, 2025 featured the highest construction volume for multifamily missing middle housing starts since 2007. The missing middle construction sector includes development of medium-density housing, such as townhouses, duplexes and other small multifamily properties. 

However, the multifamily segment of the missing middle (apartments in 2- to 4-unit properties) has generally disappointed since the Great Recession. This subsector of residential construction continues to underperform relative to its potential, due in part to zoning restrictions.

Over the course of 2025, there were 19,000 2- to 4-unit housing unit construction starts, up 6% compared to 2024 (18,000). 

As a share of all multifamily production, 2- to 4-unit development was just 5% of total multifamily development for the fourth quarter. This remains lower than recent historical trends. From 2000 to 2010, such home construction made up a little less than 11% of total multifamily construction. 

See a chart of historic trends in this Eye on Housing post.