Starts To Date A Tad Below Expectations

Multifamily Starts: After the big boost reflecting the large number of starts in New York City last month, things have calmed down. Preliminary starts numbers for last month would give us a seasonally adjusted annual rate of 309,000 units for 2008 That’s a bit shy of the 325,000 level that NAHB’s forecast currently calls for, but as we’ve seen, monthly numbers can swing wildly up and down, depending on local market conditions.Rent Changes: The consumer price index keeps rising—but the cost of rent has barely fluctuated over the last six months. On the one hand, that makes current rents seems more reasonable. On the other hand, residents have less money to spend on rent.Interest Rates: It’s “steady as she goes,” for the Prime rate and the LIBOR index—and slight downward movement for the 10-year Treasury notes. That minor slide actually may signal some good news for publicly-held multifamily firms: In the August issue of NAHB’s Multifamily Market Outlook (, housing policy economist Elliot Eisenberg pointed out that as the yield for Treasury instruments falls, the stock prices of multifamily firms tend to rise. Sources for Multifamily Starts, Rent Changes, Interest Rates: National Association of Home Builders.To comment, contact Keat Foong at