The NAHB Multifamily Production Index (MPI) held steady with a reading of 54 for the first quarter of 2015. This is the 13th consecutive quarter with a reading of 50 or above.
The MPI measures builder and developer sentiment about current conditions in the apartment and condominium market on a scale of 0 to 100. The index and all of its components are scaled so that any number over 50 indicates that more respondents report conditions are improving than report conditions are getting worse.
The MPI provides a composite measure of three key elements of the multifamily housing market: construction of low-rent units, market-rate rental units and “for-sale” units, or condominiums. The MPI component tracking low-rent units increased two points to 54, market-rate rental units dipped three points to 59 and for-sale units held steady at 50.
The Multifamily Vacancy Index (MVI), which measures the multifamily housing industry’s perception of vacancies, dropped three points to 36, with lower numbers indicating fewer vacancies. This is the lowest reading since the fourth quarter of 2012.
Historically, the MPI and MVI have performed well as leading indicators of U.S. Census figures for multifamily starts and vacancy rates, providing information on likely movement in the Census figures one to three quarters in advance.
For data tables on the MPI and MVI, visit www.nahb.org/mms.