X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

WASHINGTON, DC-Numbers released by the US Department of Commerce concluded that October was an exceptional month for the homebuilding industry, and the good news extends to both single-and multifamily development. Housing starts among multifamily properties increased 9.5% over September, with 382,000 new units getting under way compared to 349,000 last month; the rates are seasonally adjusted.

Industry officials had expected the situation to look up following September’s inclement weather, but the large jump in percentage points came as a welcomed surprise. The new figure constitutes the largest increase in starts since December of last year.

“Excellent financing conditions are still the key to solid housing market performance, including much of the strength on the condo side of the multifamily market,” notes David Seiders, chief economist for the National Association of Home Builders. “Improving economic conditions, particularly job and income growth, are additional factors in housing’s favor heading forward.”

While multifamily starts were on the rise across the country, activity was particularly abundant in the Northeast where multifamily housing starts escalated by 20%. In the Midwest, the starts increased by 8.6%, and in the West and the South, the numbers went up 5% and 4%, respectively. The additional units getting underway will accommodate significant current, and impending, demand in selected markets.

“Vacancy rates have peaked in most markets and are set to decline in the year ahead, thanks to rising employment and interest rates,” Marcus & Millichap researchers conclude in their 2004 National Apartment Report. According to the report, the relentless drain of jobs over the past three years has created pent-up demand for rental units, especially among recent college graduates and the unemployed. An estimated four million adults aged 25 to 34 currently reside in their family’s home. Many of these potential renters have been forced to move back with their parents or double-up with other renters to conserve cash, but as employment conditions improve, they will begin to create separate households, resulting in “a significant expansion in tenant demand.”

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 3 free articles* across the ALM subscription network every 30 days
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt

Copyright © 2020 ALM Media Properties, LLC. All Rights Reserved.