Amid a growing number of troubling macroeconomic reports, including two noticeably weak monthly employment reports, the slow — at times uneven — improvement for the housing and residential building sector remains as a positive factor for the nation’s economy.
That said, multifamily starts posted a significant drop in May, declining more than 20%. But the long-run trend continues to be one of improvement. According to the three-month moving average, starts of multifamily units in properties with five or more units now have been above a 200,000 annual rate for three consecutive months. And the Census Bureau reported that multifamily construction spending was up 6.3% in May and is now more than 50% higher than spending levels from a year ago.
Similarly, while sales of condominiums and co-ops were down nearly 6% in May from April’s levels, they are up more than 4% from levels reached a year ago.
NAHB’s quarterly survey data suggests continued growth for multifamily. The first quarter 2012 Multifamily Vacancy Index dropped to 31 — the lowest level since the index’s beginning in 2003 — forecasting more declines in rental vacancy rates. The Multifamily Production Index increased from 49 to 51, indicating more growth in multifamily construction ahead.
Finally, a recent Census study of shared households — households with additional adults — indicate that there is significant pent-up housing demand. That will help lift rental and owner-occupied housing demand as we see growth in labor markets.
For the full story, check out these Eye on Housing posts.
Census Bureau’s newest release on construction spending showed a 2.8%
increase in spending activity for private residential projects in May..
Multifamily spending increased 6.3% compared to April, and has surged more than
50% on a year-over-year basis. Posted July
The total number of traditional,
not-shared households fell by more than 700,000 (0.9%) from 2007 to 2010. In
contrast, the number of shared households rose by almost 2.3 million (12.1%). Posted June 26.
research shows 23.8 million homes that existed in 2009 switched back and forth
between serving owners and renters since 1985. This is considerably fewer
than the 54.2 million units that had been for owners consistently, but more than
the 18.3 that served the rental community continuously. Posted June 22.
May existing home sales declined 1.5% from April, but are up 9.6% from the same period a year ago. Seasonally adjusted condominium and co-op sales were 500,000 in May, down 5.7% from April, and up 4.2% from the same period a year ago. Posted June 21.
of apartments were down more than 20% in May, but the long-run trend remains
positive. Under a three-month moving average, May was the third consecutive
month for which five-plus starts were above a 200,000 starts rate. Posted June 19.
the first quarter of 2012, NAHB’s Multifamily Vacancy Index (MVI) dropped to
31, the lowest it’s been since the inception of the index in 2003. For
this index, lower is better. Posted
In the first quarter of 2012, NAHB’s Multifamily Production Index (MPI) continued to show improvement, increasing from 49 in the fourth quarter to 51. Posted June 7.
Multifamily Market Outlook is a monthly review of economic and housing statistics and housing policy issues. It is a digest of selected posts from Eye on Housing, an NAHB blog featuring news and analysis from Chief Economist David Crowe and other staff experts.
Congress continues to work on funding bills for fiscal 2013. As the members deal with spending caps put in place by the Budget Control Act, both the House and Senate had to make difficult choices with regard to all federal programs, including the housing programs. This table reflects funding levels and the President’s budget proposal. The House has now passed the Transportation and HUD funding bill, and NAHB is waiting for the Agriculture funding bill that includes rural housing programs to be brought to the floor for a vote.
While the Senate has indicated this week that it will not vote on any individual spending bills, both the HUD funding and the Rural Housing Service bills have passed out of Committee. Because the 2012 Fiscal Year ends on Sept. 30, NAHB is continuing its dialogue with both sides to voice our concerns over several of the funding decisions.
Of particular note is funding for Project-Based Rental Assistance (PBRA). The President’s budget request for PBRA was not sufficient to renew all expiring PBRA contracts for a full 12 months. In fact, two-thirds of the contracts would not get a full year’s funding. The Senate corrected this issue and fully funded the PBRA program, but the House chose to respect the President’s request. NAHB and a coalition of other organizations are working to have this issue addressed when Congress moves forward with a final funding bill for the President to sign.
Responding to pressure from NAHB and other advocacy groups, the Environmental Protection Agency (EPA) has decided to delay the deadlines leading to the National Stormwater Rulemaking targeting stormwater discharges from newly developed and redeveloped construction sites.
Comment letters from NAHB and other trade associations as well as environmental advocates emphasized the need for EPA to develop a more data-based ruling based on science and real-world models.
Now, as a result of negotiations with the Chesapeake Bay Foundation, EPA intends to propose a rule to strengthen the national stormwater program by June 10, 2013 and complete a final action by Dec.10, 2014.
A letter of agreement signed between the groups established initial rulemaking milestone dates. EPA is expected to continue work gathering information and analyzing costs and benefits on the rule through the summer and into the fall before assembling a draft proposed rule. EPA will likely submit the draft to the Office of Management and Budget in early 2013. EPA has posted information reflecting these dates on its website.
The Brownstones of Brambleton, Ashburn, Va., won a Platinum award in NAHB's 2011 Best of American Living Awards design competition in the Kitchen Design category.
The Brownstones are in an urban-like setting in a suburban community with a classic facade and a very open, loft-like floor plan. The goal of the Pierrepont model was to evoke an emotional 'wow' response when visitors arrive in the main living level at the top of the stairs.
This was a challenge within the constraints of a 24-townhome unit. Inspired by an image in a high-end appliance catalog that features a contemporary steel hood over a cooktop in a large island with a wall of windows beyond, the developers worked with the architect to create the kitchen.
This kitchen introduces a level of modern design not often seen in such a traditional marketplace. Located in the center of the wide open floor plan, the kitchen is adjacent to a large great room that expands onto a rooftop terrace.
The enormous, 11' granite island contains the cooktop and provides generous work space as well as comfortable dining for five. Twelve feet of glass from countertop to ceiling displays a backdrop of windows that naturally illuminates the main level. While the wall of glass is inspirational, it required a solution to provide wall cabinet storage lost to the windows.
2011 Best in American Living Platinum Award Winner for Interior Design: Kitchen
Photography by Jim Kirby Photography
Architect: Lessard Design, Inc., Reston Va.
Builder: Miller and Smith, McLean, Va.
Interior Designer & Merchandiser: Carlyn and Company,
Great Falls, Va.
Developer: Brambleton Group, LLC, Brambleton, Va.
Land Planner: Parker Rodriguez, Alexandria, Va.
An adjacent 10-foot wall of floor-to-ceiling cabinetry more than compensates for the storage eliminated by the windows and also creates a built-in appearance. High-performance stainless steel appliances complete the upscale look and feel of this room.
The Pierrepont model
has emerged as the market leader in design and popularity largely due to
its standout kitchen. Itl began selling immediately after being
released, and developers immediately started a waiting list for future releases.
Given this success, the developer has been able to raise prices
consistently, a significant achievement for a high-end townhome.
View more photos of Brownstones of Brambleton.
The Best in American Living Awards began accepting entries for 2012 on June 1. The 2012 awards will be presented at the International Builders' Show in Las Vegas.
More information about the program and other 2011 winners can be found at www.bestinamericanlivingawards.com.
For more information about this item, please contact Jaclyn Toole at 800-368-5242 x8469.
With two days of judging complete and scores tallied, NAHB has announced and posted on the website the finalists in the 2012 Pillars of the Industry Awards. The awards honor the nation's best built developments and marketing campaigns and materials, as well as individual and corporate achievement.
A panel of industry experts volunteered their time to judge the entries:
Winners in each category will be announced in the afternoon of Oct. 4 in an online ceremony with photos that will highlight the qualities and features that impressed the judges. The presentation, which will be presented on www.nahb.org/pillarsawards, will remain available on the site.
Maryland now has its first Silver National Green Building Standard-certified multifamily community, The Haven at Odenton Gateway, inOdenton. The 252-unit community opened this spring, and was developed by Johnson Development Associates, a Spartanburg, S.C. firm which had previously built an NGBS-certified building in Virginia.
The Silver certification is an important marketing advantage for the community, located in the watershed of the Severn River and the Chesapeake Bay. Construction was limited to "non-sensitive" areas of the site, and care was taken to have minimal soil disturbance or erosion during the building process.
The developers' landscape plan included native and regionally-appropriate grass, trees and other vegetation to reduce water runoff, pollution and flooding, and managed stormwater to minimize concentrated flowing of water from the site. The rainwater collection and distribution system — part of the stormwater plan — also supplies water to a low-volume irrigation system for the community's outdoor greenery.
Recycling also played a part, along with the choice carpet and flooring, and the use of advance framing techniques to minimize lumber use and waste. Energy Star-rated appliances, high levels of insulation and efficient windows, and water-saving fixtures and appliances help keep residents' costs low.
Cathy Vitale, the Maryland House of Delegates representative for that district, attended the grand opening, as did NAHB Research Center President/CEO Mike Luzier and the president of Johnson Development's multifamily division, as well as a large number of local attendees and media.
NAHB's Legal Research Program has answered thousands of members' questions over the years, and has pulled together responses to those that are frequently asked on the Legal Tips webpage.
Recently, many members have inquired about construction liability and lien waivers, so information on that topic is now posted on the NAHB Legal Tips webpage.
Members with legal questions can contact the Legal Research Program directly.
- The Wall Street Journal sees rising rents and falling vacancies as an opportunity for investment, but cautions against overbuilding.
Weighing in with a different opinion, a National Real Estate Investor story is headlined "Observers Say Concerns Over Multifamily Overbuilding are Overblown."
- How small can apartments go? Crain's reports that a recent request for proposals from New York City is looking for builders to construct a rental apartment building with units less than 400 sq. ft., and as small as 275 sq. ft.
Pop the corks on the champagne (or the pop-top on your soda)! The Wall Street Journal says that housing, having hit bottom, has now convincingly begun to turn upward.
- Reed Construction Wire has new cost-per-square-foot tables on four-to-seven-story apartment buildings in 25 U.S. cities.
- National Real Estate Investor explores the pros and cons of the Student Housing sector.
- If better-paying jobs lead to household formations, Business Insider's list of the 10 U.S. cities with the fastest-growing wages should point toward opportunities for multifamily development.
"Financing for Builders" Webinar — July 17
In this one-hour webinar, which is free to NAHB members, multifamily builder Michael E. Warren, AMJ Inc ., and production builder Ed Brady, Brady Homes, will address these questions:
Building Systems Council's Excellence Awards -- Early Bird Deadline Aug. 20
Multifamily builders who use systems-built technology and construction techniques are encouraged to enter the 2013 Jerry Rouleau Excellence in Marketing and Home Design Awards, which honor achievement in marketing and home design and salute the finest in technology-driven and systems-built home manufacturing and construction.
Early entrants pay only $65 per entry. Consult the Excellence Awards web page for details, or contact Donna Peak, 800-368-5242 x8577.
BALA Awards Now Open — Entries Due Sept. 4
you been part of a design team that has built or remodeled multifamily condos or rental communities?
Fall Board of Directors and Membership Meeting — Austin, Texas, Sept. 12-15
Plan to join your industry peers for a great experience in the city whose unofficial motto is "Keep Austin Weird!" The meeting coincides with the Texas Association of Builder's Sunbelt Builders Show, Sept. 13-15, so there'll be plenty to do and see. Go for the meeting, stay for the barbecue!