The National Association of Home Builders’ (NAHB) Multifamily Production Index (MPI) dropped three points to 50 in the second quarter of 2016. It’s the 18th consecutive reading of 50 or above, which means more builders and developers report that current conditions in the apartment and condominium market are improving than report conditions are getting worse.
The MPI is comprised of three key sub-components: construction of low-rent units, market-rate rental units and “for-sale” units, or condominiums. Low-rent units decreased two points to 52 in the second quarter, while market-rate rental units dropped five points to a level of 53, and for-sale units fell three points to 45.
The NAHB Multifamily Vacancy Index (MVI), which measures respondent perceptions of vacancies in the multifamily housing market, increased three points to 42, with higher numbers indicating more vacancies. However, the MVI is still below the break-even point of 50, which means that more respondents perceived a reduction in vacancy rates than perceived an increase.