Square foot prices more than double inflation in 2022

Median square foot prices for new for-sale single-family detached (SFD) homes started in 2022 increased 18% to $155, according to the National Association of Home Builders (NAHB) analysis of the latest Survey of Construction data. Increases for square foot prices in new custom SFD homes were similarly high, averaging 19% to a national median of $156 per square foot. Both increases were more than double the U.S. inflation rate of 8% that same year.

The rise in median contract prices per square foot reflect fast rising construction and labor costs that pummeled home building in the post-pandemic environment.

The data also included regional details:

• Half of all for-sale SFD homes started in the East South Central division in 2022 registered square foot prices of $132 or lower, while the West South Central and South Atlantic divisions registered median prices below the national median at $152 and $150 per square foot, respectively.
• Half of new SFD homes started in the Pacific and New England divisions in 2022 were sold at prices exceeding $214 and $219 per square foot of floor area, respectively.
• Half of custom SFD homes started in New England in 2022 registered prices in excess of $213 per square foot of floor area.
• The Mountain division recorded $200 per square foot of floor space.
• Prices in the East North Central division reached $185 per square foot.
• The median custom square foot prices in the Mid Atlantic division were $160 per square foot.
• Half of custom SFD started in the Pacific in 2022 had prices of $160 per square foot or higher.
• The corresponding median price in the West North Central region, which includes Iowa, was $155.
• The South Atlantic division is where most economical custom homes were started in 2022, with half of new custom homes registering prices at or below $131 per square foot of floor space. East South Central and West South Central recorded median square foot contract prices of $156 and $141, respectively.