Multifamily Developer Confidence Rises Amid Improving Conditions

Multifamily Developer Confidence Rises Amid Improving Conditions

Confidence among multifamily developers strengthened in the third quarter as both financing and demand conditions showed improvement compared with a year earlier, according to the latest survey by the National Association of Home Builders (NAHB). However, broader economic uncertainties continue to temper optimism across the sector.

The NAHB’s Multifamily Production Index rose to 46 in the third quarter—up six points from a year ago—indicating that while sentiment has improved, more developers still report pessimism than optimism, as readings below 50 suggest. Meanwhile, the Occupancy Index remained strong at 74, signaling positive perceptions of rental demand, though it slipped one point year-over-year.

“We are seeing a degree of bifurcation in the multifamily market, as developers of low-rise market-rate and subsidized rental properties express increased optimism, while developers of mid- and high-rise properties and condominiums remain less confident,” said Debra Guerrero, senior vice president at the NRP Group and chair of NAHB’s Multifamily Council.

Guerrero noted that persistent obstacles—including a challenging regulatory environment, elevated construction costs, and difficulties securing project financing—continue to weigh on overall sector performance.