Have Multifamily Permits and Starts Hit a Turning Point in the Cycle?

Nationally, the surging wave of multifamily completions are cresting (although individual market peaks vary), but what about the beginning of the construction pipeline?

Both multifamily permitting and starts appear to be troughing and may have reached the bottom of the current construction cycle, according to the permit and housing survey data in the latest report from the U.S. Census Bureau and the Department of Housing and Urban Development. Granted, one or two month’s data is not enough to call a trend or even an inflection point, but graphed trends are still visually interesting.

March’s seasonally adjusted annual rate (SAAR) for multifamily permitting increased 10.1% from February to 445,000 units, about even with last year. Meanwhile, annualized multifamily starts were unchanged from last month at 371,000 units and up 47.8% from last March’s unusually low figure.

The SAAR series are much more volatile than the moving 12-month sum of permits and starts that are not seasonally adjusted (NSA), but they are more forward-looking. The less volatile sum of monthly permits and starts show a similar month-over-month turn towards growth, the first time one or both have not declined since early-2023. March’s 12-month NSA permit total inched up 0.2% from February to 424,600 units, while the NSA sum of starts increased 2.8% to 343,000 units.

Another indication that multifamily construction may be turning the corner is that the SAAR for multifamily units under construction decreased 20.7% from last March but was down only 1.2% from February to 740,000 units.

Seasonally adjusted annual completions decreased 8.2% from last month to 503,000 units and were down 4.4% from last March. While not necessarily tracking identically due to definitional differences, RealPage’s apartment completions total for 1st quarter 2025 closely approximates the NSA monthly total for completions from the Census Bureau through March (576,720 versus 587,300). Both were down from peaks at the end of 2024.

Turning to single-family construction, the SAAR for single-family permitting fell 2% from February and 0.6% from last year to 978,000 units. Meanwhile, annualized single-family starts fell below one million units to 940,000 homes, down 14.2% for the month and 9.7% for the year.

Single-family completions increased 0.9% to 1.029 million units, up 9.6% for the year, while single-family units under construction were down 1.6% from last month and 8.7% for the year at 632,000 units.

Compared to one year ago, the annual rate for multifamily permitting decreased sharply in the small Northeast region (down 52.9% to 36,000 units) and fell 16.1% in the West (to 92,000 units). Permitting increased for the year in the Midwest (up 28% to 74,000 units) and South (up 18.8% to 242,000 units) regions. Compared to the previous month, permitting was down in the Northeast and Midwest Census regions and up in the West and South.

Annualized multifamily starts more than doubled in the Northeast region (up 159.6% to 71,000 units) and were up almost sixfold in the Midwest (up 484.1% to 101,000 units). The South region had a more modest increase of 26.5% to 146,000 units, while the West saw starts decrease by 41.1% to 54,000 units. Compared to February’s SAAR, starts were up sharply in the Northeast and Midwest and down in the South and West regions.