by Vanguard Staff
A new report from the National Multifamily Housing Council (NMHC) shows continued uncertainty in the apartment construction and development market, despite notable signs of improvement in project delays and labor availability.
The June 2025 Quarterly Survey of Apartment Construction & Development Activity reflects mixed market conditions but a stronger outlook for the future. Most significantly, fewer than half of respondents—43 percent—reported experiencing construction delays over the last three months. That’s a marked decline from 58 percent in March, 78 percent in December, and 52 percent in September, making it the lowest level of reported delays since the survey’s inception and the first time the figure has dropped below 50 percent.
Still, challenges remain. According to NMHC Economist and Senior Director of Research Chris Bruen, “While the June survey results indicate improving conditions for multifamily construction—respondents reported greater availability of construction labor compared to three months ago and fewer overall delays—we also know that far fewer projects are being started to begin with.”
Bruen pointed to data from CoStar showing a 35.1 percent decline in multifamily starts between the first quarters of 2024 and 2025. The drop is attributed to ongoing economic uncertainty, elevated interest rates, and rising construction costs. A majority of survey respondents expect those costs to increase further over the next six to twelve months.
Despite those concerns, the survey revealed a shift in deal pricing and a modest rebound in market confidence. Only 34 percent of respondents said deals were repriced downward, a decrease from 50 percent in March. Meanwhile, the share of respondents seeing deals repriced upward rose to 38 percent, up from 25 percent in the previous quarter.
Labor conditions showed a slow but encouraging trend toward improvement. Fifty-one percent of respondents reported labor availability remained about the same as three months ago. Eleven percent said labor had become less available, while 32 percent said it had become more available.
Material delays also persisted, with 26 percent of respondents experiencing disruptions. However, those delays appear less widespread than earlier in the year.
New to this quarter’s report are index values indicating whether respondents expect various construction conditions to improve, worsen, or stay the same over the coming year. A short-term market index score of 47, just below the neutral level of 50, signals expectations of a slight decline in market conditions over the next three months. But sentiment over the medium term (six to twelve months) improved to 52, and the long-term outlook climbed to 71, suggesting growing optimism for the months ahead.
