Multifamily Built-for-Rent Share Dips Slightly in Q4 2023

An analysis of quarterly Census data by the National Association of Home Builders (NAHB) revealed a slight decline in multifamily for-rent housing starts during the fourth quarter of 2023.

A total of 102,000 multifamily residences began construction in the quarter, with 98,000 of those falling under the built-for-rent category.

The share of multifamily construction starts dedicated to rental units remained high at 96% in Q4, reflecting the continued sluggishness of the condominium market due to rising interest rates.

This figure stands in stark contrast to the historical low of 47% recorded during the condo boom in Q3 2005.

For context, the average share during the 1980-2002 period was 80%.

Q4 2023 saw a mere 4,000 multifamily condo construction starts.

The continued dominance of rental units in multifamily construction is contributing to smaller apartment sizes compared to the pre-Great Recession era.

Data from Q4 2023 shows that the average square footage of multifamily construction starts remained relatively flat at 1,050 square feet, while the median square footage declined to 1,022 square feet.

(Source: Robert Dietz | Eyeonhousing.org)