By Jessica Fiur, News Editor
Washington, D.C.—There may be a national housing crisis, but it certainly doesn’t seem like it in the multi-housing industry. The National Association of Home Builders (NAHB) recently released their Multifamily Production Index (MPI), which showed continued improvement for the fifth consecutive quarter for the apartment and condominium market.
The MPI measures three elements in the multifamily market: construction of low-rent units, market-rate rental units and “for-sale” units (condos). The conditions are rated on a scale of 0 to 100, and increase from 44.4 in the second quarter to 47.3 in the third quarter. This is the highest reading since the fourth quarter of 2005.
In the third quarter of 2011, the MPI that tracks builder and developer perceptions of market-rate rental properties saw an all-time high of 63.9, and low-rent units stayed steady at 50.1. For-sale units rose to 31.9, which is the highest it’s been since the second quarter of 2006.
“We’ve seen multifamily going up,” David Crowe, chief economist, NAHB, tells MHN. “I think it will go up for a while.”
Expectations for the next six months increased for market-rate rental properties and condo sales.
However, while the multifamily market is predicted to increase, it won’t necessarily be at the same rate.
“Builders will take a breath,” Crowe predicts. “We know they continue having difficulty acquiring funds. We need more household growth to justify our pace, and we’re not getting it.”