Developers are remaining positive in their outlook for multifamily starts for the next six months, as suggested by the Multifamily Production Index (MPI) released by the National Association of Home Builders (NAHB) Tuesday.
The index reached 54 in the third quarter. It measures builder and developer sentiment about current apartment market conditions on a large scale, and numbers over 50 indicate that more respondents are reporting positive conditions, showing steady improvement in the industry. The index measures three key elements: construction of low-rent, market-rate rents, and condominium units. They each fell from 2013 peaks but still remain above 50.
The third quarter’s MPI is seven points lower than the index’s second quarter spike this year, but it’s still the seventh consecutive reading above 50.
The other half of its survey, the multifamily vacancy index (MVI), measures the industry’s perception of vacancies, and it’s dropped two points to 40; lower numbers indicate fewer vacancies. It’s improved consistently through 2010, the report says, and has been fairly stable in the last two years following its peak at 70 in the second quarter of 2009.
For more data trailing back to 2008 on MPI and MVI, visit the NAHB’s website.
-Linsey Isaacs is an assistant editor with Multifamily Executive magazine. Follow her on twitter @LinseyI to continue this conversation.