The Local Economic Impact of Home Building


NAHB owns proprietary models that estimate the costs and benefits of new home construction. The benefits model estimates the income, jobs and taxes generated by home building in an area (usually a metropolitan area, nonmetropolitan county, or state). A companion model estimates the governments’ costs of extending services to the new homes and compares these costs to the tax revenue generated, to show how quickly housing pays for itself. This page provides links to reports with impact estimates for “typical” or “average” cases, as well as information on obtaining customized reports for a specific local area or individual construction project.

'Typical Case' Reports Available at the Click of a Mouse

By using national averages for key inputs like value of the homes, and taxes and fees collected by governments, NAHB has estimated the economic impacts of home building in typical cases and made the results available here.

One set of results is available in a report that estimates the impact on Income, Jobs, and Taxes Generated from building 100 single-family and 100 multifamily homes, as well as $1 million of residential remodeling in a typical local area. Another report Compares Costs to Revenue for Local Governments and show how long it takes, in the typical case, for home building to pay for itself.

NAHB has also estimated the impact of home building on the economy of an average state. Again one report analyzes the Income, Jobs, and Taxes Generated; and another compares Costs to Revenue for State and Local Governments.

Customized Local Impact Reports that Can be Ordered for a Fee

Customized reports for a particular area may be ordered by providing some specific information on the construction to be analyzed and agreeing to pay a fee. The information may be provided for construction in an entire market area (a metropolitan area, a county not part of a metropolitan area, or a state), or a jurisdiction or individual project within a market area. However, the local impacts estimated are broad and always spread over the entire market area. Analyzing an individual project usually involves extra work to make sure specific circumstances applicable to that project are captured and described appropriately. Typically, reports analyzing home building in a market area, or city or county within the market area, are ordered by state and local Home Builders’ Associations. Reports analyzing individual projects are usually requested by the developers of the projects.