In September, the (seasonally adjusted) annual rate of starts in buildings with five or more apartments was 260,000, according to the latest release from the Census Bureau’s Manufacturing and Construction Division. This is up 25 percent from August, and the highest the five-plus starts rate has been since September of 2008. To illustrate how far the market has come from the recent historic trough, 260,000 is two and half times the total number of five-plus units started in either 2009 or 2010.
Also in September, the seasonally adjusted annual rate at which new five-plus permits were issued increased 23 percent to 323,000—the highest the five-plus permit rate has been since June of 2008. The backlog of unused five-plus permits still in the pipeline at the end of September was 46,600 (not seasonally adjusted). This is down fractionally from the August number, which was the highest the backlog of five-plus permits had been since early 2009. The strong permit numbers are an indication that multifamily production is likely to be relatively healthy over the next few months, and that a five-plus starts rate as high as 260,000 may be sustainable.
For those interested in how much employment is being sustained by apartment production, the number of five-plus units under construction has been edging up steadily and at 226,000 is now the highest it’s been since October 2009.