Builders, developers remain positive on multifamily market

Steady demand for multifamily housing is expected through the rest of 2018

By Francis Monfort

31 May 2018

The level of demand and vacancy rates for multifamily housing have kept builder and developer confidence in the market positive in the first quarter, according to the Multifamily Production Index (MPI) and the Multifamily Vacancy Index (MVI) released by the National Association of Home Builders (NAHB).

The MPI, which measures builder and developer sentiment about current conditions in the apartment and condo market, was unchanged from the previous quarter at 53 on a scale of 0 to 100. The MVI, which measures the multifamily housing industry's perception of vacancies, remained essentially unchanged with an increase of one point to 42, which is seen as healthy for the multifamily market.

“Multifamily builders and developers are reporting solid demand around the country, as shown in the vacancy rate for the first quarter,” said Steve Lawson, chairman of NAHB’s Multifamily Council. “We anticipate steady demand through the rest of the year as household formations continue to grow.”

“The stability of multifamily builder confidence is consistent with NAHB’s view that the market has reached a healthy, sustainable level of production,” said NAHB Chief Economist Robert Dietz. “The overall strong economy is supporting demand and balancing supply-side issues many builders are facing, including shortages of labor and buildable lots, and the recent surge in lumber prices.”