The ongoing problems of scarcity and high cost of land and materials is making it difficult to go forward with certain projects, particularly affordable housing projects, according to a report last week from the National Association of Homebuilders (NAHB).
Continued high levels of multifamily development declined significantly in the third quarter, as did the prospects for continued high occupancy rates, according to the report.
Sean Kelly, executive vice president of LNWA in Wilmington, Del., and chairman of NAHB's Multifamily Council, said in prepared remarks that although demand for multifamily housing remains strong in many parts of the country, "some multifamily developers are starting to see signs of a slowdown."
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NAHB Projects Significant Decline in 2023
NAHB Chief Economist Robert Diez added in prepared comments, "Multifamily developers are becoming cautious, as supply constraints have caused a large backlog of projects started but not yet completed to accumulate in the pipeline.
"An emerging additional constraint is financing for new multifamily development, which 79% of developers say is somewhat or significantly less available than it was a year ago. NAHB is now projecting a significant decline in multifamily starts in 2023."
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