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Industry & Trends

Why the “Missing Middle” Is an Opportunity for Home Builders

Between the single family and large multi-family buildings that dominate home building today lies an underdeveloped middle.

The so-called “middle” sector of the U.S. homebuilding market – the medium-density structures like duplexes, triplexes and townhouses – grew just 11 percent nationwide over the past 20 years, contributing to the overall shortage in homes in the country.

That’s according to a new analysis by Storagecafe, a listing service for storage facilities, that analyzed data from nearly 500 cities across the country, examining housing affordability, availability and regional differences in how housing is being built.

The company looked at markets in Arizona and Texas, which are witnessing an influx of new residents and found that these middle market housing structures make up as little as 25 percent of inventory as demand far outpaces supply. This has caused steep, above-average increases in housing prices.

In contrast, in states like New Jersey and Pennsylvania, which have stronger middle housing markets, home prices are often gaining less than the national average. Nationwide, housing inventory has grown just 17 percent in the period from 2005 to 2023 contributing to the shortage, it said.

Doug Ressler, business intelligence manager at Yardi Matrix, a sister company to Storagecafe, said the shortage in the middle market isn’t necessarily an easy one to address. “The focus on single-family homes has created a significant gap in the middle housing segment, one that remains difficult to fill even as multifamily housing gains momentum.

“Reviving ‘missing middle’ housing requires more than just building additional units—it involves rethinking zoning laws, offering financial incentives and exploring innovative solutions like office-to-residential conversions. These approaches can help maximize existing spaces while ensuring they align with community needs.”

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International Woodworking Fair
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August 25–28, 2026

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