A record number of multifamily developers are reporting construction delays and price increases in materials, according to the latest survey.
The latest National Multifamily Housing Council COVID-19 Construction Survey finds a record 83 percent of multifamily developers reported construction delays, up significantly from the March survey which also set a record with 75 percent of respondents reporting delays.
All respondents reported cost increases for materials with lumber seeing the steepest price hike. On average, respondents experienced a 201 percent price increase in lumber costs over the past year.
NMHC received 109 responses from leading multifamily construction firms for the seventh round of surveys aimed at helping the industry stay on top of changing marking conditions during the COVID-19 pandemic. The latest survey was conducted from May 17 to June 1 and the first was taken from March 27 to April 1, 2020.
Main reasons cited for delays in starts were permitting, entitlement and professional services (70 percent); projects not being economically feasible at the time (56 percent), up from 30 percent in the last survey; and economic uncertainty (27 percent).
NMHC President Doug Bibby said the findings of the latest survey highlight the deep challenges multifamily builders and developers are facing as the country continues to recover from the economic impacts of the pandemic.
“While we are encouraged by the overall prospects for the industry, skyrocketing construction costs and a lack of available labor makes it increasingly difficult and expensive for apartment homes to be built—worsening the affordability challenges facing communities across the country over the long-term,” Bibby said in a prepared statement.
Image: Pixabay
