The Multifamily Juggernaut




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National Association of Home Builders tax and policy expert Rob Dietz looks at recent data from the Census Bureau and Department of Housing and Urban Development Survey of Market Absorption of Apartments (SOMA), whose topline finding is that completions of privately financed, unsubsidized, unfurnished rental apartments in buildings with five or more units totaled 171,500 residences for the four quarters ending with the second quarter of 2014, a 47% increase from the prior four quarter total.

That’s an amazing one-year gain, and underlying that headline is the fact that the juggernaut includes only market-rate, unfurnished apartments, while condos and other types of multifamily, such as LIHTC units, have languished at lower than normal levels. Dietz writes:

For properties with five or more units approximately 3,700 Low-Income Housing Tax Credit or other federally subsidized units were completed during the second quarter of 2014. This is down from the 6,700 such units completed a year earlier. Over the last four quarters, 32,800 LIHTC and other affordable housing units were completed (15% of the total).