Dive Brief:
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Builders are more optimistic about the near future of the housing market than they have been in nine years, but they’re not so sure about the prospects for multifamily production.
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The National Association of Home Builders’ Multifamily Production Index showed a drop in the confidence that builders and developers have about current conditions in the apartment and condominium market. While more than half of the construction pros in the survey expressed optimism that the market will improve, their level of confidence is lower than it was last quarter.
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Also out is NAHB’s Multifamily Vacancy Index, which measures builder and developer perception of vacancies. This latest index rose three points from last quarter, which means more apartments are vacant than last quarter. Still, the vacancy rate is well below its 2009 peak and has remained fairly stable for three years.
Dive Insight:
Despite the dip in confidence, the latest report reflects the 11th straight quarter that more builders and developers than not have a positive outlook for the industry. A big part of their reasoning: They believe growth in employment will continue to fuel demand for apartments, according to an official with NAHB’s Multifamily Leadership Board.
The index is generally a reliable predictor of the industry’s near-term performance.