April 2013 Multifamily Permitting Surpasses Long Term Average via Axiometrics

The U.S. Census Bureau posted its April residential permitting numbers by metropolitan statistical area (MSA) on Thursday, May 16. Privately-owned housing units authorized by building permit in April, measured on a seasonally adjusted annual rate (SAAR), were 1,017,000. This represented an increase of 14.3% from the revised March rate of 890,000 and was 35.8% above the April 2012 estimate of 749,000. During April 2013, annual multifamily (MF) permits at the national level increased by 43.5% from the comparable period a year ago. With the April 2013 MF permit number measuring 305,119 units, annual MF permitting has now been above 200,000 for 18 consecutive months and has edged past its long-term average monthly rate of 290,000. Despite only moderate job growth nationally, developers and investors are pursuing multifamily deals in numerous markets where local fundamentals are still stable to improving. The Census Bureau reports that annual starts have matched the long-term monthly average around which they have typically hovered for the past several years, with the exception of during the great recession. It remains to be seen if the headwinds to the national economy from federal spending cuts, exacerbated by the sequestration, will dampen enthusiasm for the multifamily sector.

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