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Labor and supply chain disruptions as well as delays continue to hinder multifamily developers, according to the latest survey from the National Multifamily Housing Council (NMHC).

In the eighth edition of NMHC’s Construction Survey, conducted between Aug. 25 and Sept. 17, a record 93% of developer respondents reported construction delays in jurisdictions where they operate. Of this group, 83% reported experiencing delays in starts and permitting, up slightly from 80% in the seventh edition in late May and comparable to earlier results. The majority of respondents, 91%, cited permitting, entitlement, and professional services as the primary reason for delays.

The NMHC survey, which began at the start of the COVID-19 pandemic in March 2020, continues to gauge the disruption on the multifamily industry.

Almost all of the survey respondents, 98%, said they have been impacted by a lack of materials, the highest share since the survey began. In addition, all of the survey respondents reported price increases for materials for the second consecutive survey, with the average firm experiencing a 13% increase over the past three months for its most impacted materials. On a positive note, the average respondent cited a 24% price decrease for lumber over the past three months after dramatic increases were reported in late spring.

The respondents also reported an increase in stress around labor availability; 88% said they have been impacted by labor constraints, which is up 41 percentage points from late spring and up 52 percentage points from February and early March 2021.

The NMHC, for the first time, asked survey respondents how construction labor availability compares with prior to the pandemic. Almost a third, 32%, said labor is less available at pre-pandemic compensation but about the same with higher compensation levels. However, 54% responded that labor has been less available even with higher compensation levels. For those firms that said they raised compensation to attract or retain laborers, the average increase for compensation was 12%.

“Today's data underline the deep challenges that developers continue to face almost a year and a half after the onset of the pandemic,” said Doug Bibby, NMHC president. "While the overall outlook for the industry is clearly positive, these short-term and midterm risks pose significant threats to housing affordability and the nation’s economic recovery. Steps must be taken to increase the supply of labor across the country and bring material costs back to reasonable levels."

In the latest iteration of the survey, respondents also noted that economic uncertainty and projects being economically unfeasible have become less of a concern, dropping 13 and 27 percentage points, respectively, since round 7.