Multifamily Construction Sentiment Improves in Q1
According to the National Association of Home Builders’ (NAHBs’) Multifamily Market Survey, confidence in the market for new multifamily housing increased in the first quarter. The Multifamily Production Index (MPI) rose 8 points to 51 compared with the previous quarter—the first time the index has been over 50 in seven quarters.
The MPI measures builder and developer sentiment about conditions in the apartment and condo market on a scale of 0 to 100. According to the NAHB, the index and all of its components are scaled so that a number above 50 indicates more respondents are reporting that conditions are improving than getting worse.
The MPI is a weighted average of three key multifamily market elements: construction of low-rent units—apartments that are supported by low-income housing tax credits or other government subsidized programs; market-rate rental units; and for-sale units. All three saw increases in the first quarter, with the component measuring low-rent units increasing 4 points to 46, the component measuring market-rate units rising 6 points to 54, and the component measuring for-sale units posting a 13-point gain to 52.
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