It would be a better simulation for something like a cheap apartment, the sort of place you hear your neighbors every move. Two sheets of drywall and some insulation.
I remember a story about an apartment complex where someone on a lower floor had a rifle go off and the bullet went through the ceiling of their apartment, through the floor of their upstairs neighbor and then into a cat, which was fatally wounded.
I would be interested in seeing the results of someone building a simulated exterior wall in several common residential exteriors and placing ballistics gelatin on the other side of the wall. It would give you an idea of the lethality of the shot as it exits. Another wall built the same way behind it at a "very close neightbors" distance and see what it does to that wall.