The Census Bureau’s Survey of Construction (SOC) provides valuable information on the characteristics of new homes started construction, such as air conditioning and heating system installations.
Air Conditioning
In 2022, 97.1 percent of new single-family homes started had a central AC system, slightly higher than 96.5 percent in 2021. The trend, going back to 2000, shows a steady rise in the share of new homes with central AC, increasing from 86 percent in 2000 to 97 percent in 2022 (Figure 1).
Though the share of new single-family homes started with central AC differs across the country’s nine Census divisions (Figure 2), the highest share is concentrated in the South region. One hundred percent of homes started in the South Atlantic and West South Central divisions had central AC installed, followed by 99 percent in the East North Central as well as West South Central. The divisions with the lowest shares of new homes with central AC are New England (86 percent) and the Mountain (91 percent).
Heating Systems
Almost all of new single-family homes started use either an air/ground source heat pump or a forced air system for the primary heating equipment (98 percent in 2022). Twenty-one percent of homes also used a secondary type of heating equipment. In general, the share of new homes using an air or ground source heat pump as the primary means of providing heat has increased, going from 23 percent in 2000 to 45 percent in 2022. Meanwhile, the share relying on a forced air system has slipped, going from 71 percent to 58 percent in the same time frame.
The type of heating system installed varies significantly by Census Division. Figure 3 displays the share of new homes with an air or ground heat pump in 2022. In warmer regions of the country, these systems are more common: 82 percent in the South Atlantic, 63 percent in the East South Central, and 39 percent in Pacific. In colder regions, very few homes have air or ground heat pumps: only 5 percent of new homes started in East North Central and 9 percent in the New England. In colder climates, air source heat pumps (traditionally the most common type) become less efficient and rely more heavily on a back-up heating system during the winter.
The SOC also provides data on the primary fuel used to heat new single-family homes (Figure 4). Approximately 43 percent of new homes started in 2022 use natural gas as the primary heating fuel, compared to 52 percent powered by electricity. The shares of new homes with electricity and natural gas as the primary heating fuel have been stable since 2012. Like heating and AC systems, the primary heating fuel source varies significantly by region of the country. For example, in East North Central only 11 percent of new homes use electricity as the primary heating source. In contrast, 83 percent and 70 percent of new homes started in the South Atlantic and the East South Central use it.
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Is New England really that heavily using bottled propane and LNG and so lightly using heating oil? Not my expectation, but then I’ve never lived any further North than NYC. I’m a little worried the survey wording may have had people thinking their oil tanks count as bottled petroleum.
The data highlights the continued importance of energy-efficient and technologically advanced HVAC systems in modern construction projects. For individuals or developers seeking financing for construction, aligning their projects with these HVAC trends becomes imperative. Lenders may find value in supporting projects that prioritize energy efficiency, as it not only aligns with sustainability goals but also enhances the long-term viability of the construction. Being attuned to these evolving construction standards is essential for borrowers and lenders alike in navigating the construction loan landscape effectively.