Confidence out there for brand new multifamily housing elevated year-over-year within the third quarter, in line with the Multifamily Market Survey (MMS) launched as we speak by the Nationwide Affiliation of Dwelling Builders (NAHB). The MMS produces two separate indices. The Multifamily Manufacturing Index (MPI) had a studying of 46, up six factors year-over-year, whereas the Multifamily Occupancy Index (MOI) had a studying of 74, down one level year-over-year.
The MPI and MOI are giving a blended image, making a bifurcation of the multifamily market. Whereas MPI continues to be in unfavorable territory, builders of low-rise market-rate and backed rental properties categorical elevated optimism, with each parts above 50 for the quarter. Weak spot is concentrated within the mid-to-high-rise and condominium developments which are usually widespread in high-density metro areas. That is in keeping with NAHB’s Dwelling Constructing Geography Index the place multifamily development exercise is rising in areas with low inhabitants densities however weakening within the bigger metros.
Regardless that MOI is in optimistic territory and current condo homeowners are optimistic about occupancy total, that is the bottom studying since NAHB redesigned the survey beginning in Q1 2023. Sentiment for mid/high-rise condo occupancy is noticeably weaker than it’s for the opposite two rental market segments.
Multifamily Manufacturing Index (MPI)
The MMS asks multifamily builders to price the present situations as “good”, “truthful”, or “poor” for multifamily begins in markets the place they’re lively. The index and all its parts are scaled so {that a} quantity above 50 signifies that extra respondents report situations pretty much as good reasonably than poor. The MPI is a weighted common of 4 key market segments: three within the built-for-rent market (backyard/low-rise, mid/high-rise, and backed) and the built-for-sale (or condominium) market.
All 4 parts skilled year-over-year will increase within the third quarter of 2025: each the parts measuring mid/excessive rise and backed items jumped up 9 factors to 37 and 55, respectively, the element measuring built-to-sale items elevated six factors to 35, and the element measuring backyard/low-rise items elevated three factors to 51.
Multifamily Occupancy Index (MOI)
The survey additionally asks multifamily property homeowners to price the present situations for occupancy of current rental flats, in markets the place they’re lively, as “good”, “truthful”, or “poor”. Just like the MPI, the MOI and all its parts are scaled so {that a} quantity above 50 signifies extra respondents report that occupancy is sweet than as poor. The MOI is a weighted common of three built-for-rent market segments (backyard/low-rise, mid/high-rise and backed).
Two of the three MOI parts skilled year-over-year decreases within the third quarter of 2025; the element measuring backed items fell by 5 factors to 81 and the backyard/low-rise element dipped one level to 76. In the meantime, the element measuring mid/high-rise items was unchanged at 66. All three MOI parts stay properly above the break-even level of fifty.
The MMS was re-designed in 2023 to supply outcomes which can be simpler to interpret and in keeping with the confirmed format of different NAHB business sentiment surveys. Till there may be sufficient information to seasonally modify the sequence, modifications within the MMS indices ought to solely be evaluated on a year-over-year foundation.
Please go to NAHB’s MMS internet web page for the complete report.