While single-family, detached houses continue to make up the majority of homes sold in the Richmond, Virginia, region, condos and townhouses are rapidly gaining ground.
Of new homes sold in the fourth quarter, 48% were attached homes — either condos or townhouses — during the last three months of 2024, according to the Home Building Association of Richmond. On an annual basis, 41% of new homes sold were condos or townhouses last year, almost double the 21% sold in 2015.
The trend can largely be attributed to two factors, said Tom Tyler, the association’s research vice president. One is that developers are short on large tracts of land, so they’re building attached homes to maximize the number of units. The other is that attached houses are more affordable.
“Between the two factors, we’ve seen a strong shift,” Tyler said in an interview.
Across the U.S., new condo production has been low for years, with less than 25,000 units coming on the market each quarter since 2010, compared to more than twice that figure a few years earlier, according to data presented by Troy Thiel, a Wisconsin real estate agent. Development has been slowed by financing challenges and concerns about builders’ liability for construction defects. Townhouses, on the other hand, are growing in popularity. The National Association of Home Builders reported they made up 19% of single-family housing starts in the fourth quarter, and their numbers grew 10% over the year.
Of the 1,246 new homes sold in the Richmond region in the last three months of 2024, 170 were condos and 422 were townhouses, Tyler said. Two-family homes, sometimes called duplexes, are included in the townhouse data. The region includes the city of Richmond and seven nearby counties, with a population of more than 1 million.
Townhouse sales across the region increased 22% during the fourth quarter, but condo sales were up 45%. Of the 170 condos sold, almost 60% were so-called two-over-two structures in which one two-story condo is stacked above another. This type of condo is new to the Richmond area in the past decade, Tyler said. One builder is developing a project with one-floor condos stacked on top of one another.
“A lot of builders are developing that product because you can provide more units with the spaces available and offer prices that can’t be reached with single-family detached homes,” he said.
