Multifamily Developer Confidence Increases in Third Quarter
Confidence in the multifamily housing market showed modest improvement in the third quarter of 2025, according to the National Association of Home Builders’ Multifamily Market Survey (MMS). The Multifamily Production Index (MPI) rose six points year-over-year to 46, while the Multifamily Occupancy Index (MOI) slipped slightly to 74. Although the MPI remains below the positive threshold of 50, optimism among developers of low-rise and subsidized rental properties has strengthened, with both recording readings above 50. In contrast, confidence remains weaker for mid- and high-rise developments, as well as condominiums — a trend that mirrors NAHB’s data showing stronger multifamily construction in lower-density areas and slower growth in major metropolitan markets.
The MOI indicates that occupancy across most multifamily rental segments remains strong but has softened compared to previous quarters, marking its lowest level since the survey was redesigned in 2023. Owners of mid- and high-rise properties reported weaker occupancy sentiment compared to other rental types. While subsidized and garden/low-rise units continue to perform well, both saw slight declines in their ratings, with readings of 81 and 76, respectively. Overall, despite the mixed results, the data reflects a multifamily sector that remains stable but uneven, with strength concentrated in more affordable, low-rise developments and ongoing challenges for higher-density urban projects.
