According to the National Multifamily Housing Council’s latest Quarterly Survey of Apartment Construction & Development Activity, development and rental housing firms are facing significant challenges. These include delays in construction, limited financing options, and overall economic infeasibility due to rising interest rates.
The survey found that 88% of respondents reported experiencing delays in their projects. This is consistent with last quarter (90% in June) but up from 79% in March and 84% in December. Of those facing delays, most cited permitting (79%) and start delays (79%).
Financing availability was identified as the main cause for delayed starts by 78% of respondents – an increase from the previous quarter’s figure of 62%. Other factors contributing to project delays included issues with permitting, entitlements, professional services (74%), and economic feasibility concerns (61%).
NMHC president Sharon Wilson Géno stated that housing providers are still navigating through uncertain economic conditions while also dealing with high interest rates, increasing insurance costs, state/local taxes hikes,and a lack of confidence about future market conditions.
This report highlights how rental housing developers continue to face obstacles despite ongoing efforts towards growth within this sector.
