The U.S. Department of Commerce recently released a report that highlights the massive difference between new multifamily constructions and single-family homebuilding.
Statistics show that single-family housing starts took a significant plunge in March. In analyzing the Commerce Department report, Reuters also points out a “record backlog of homes approved for construction.”
On the other hand, the multifamily sector increased construction stats; so much so that it contributed to the highest annual rate since the month of June in 2006.
But what are the specific numbers, and what do investors need to know about the situation?
Single-family homebuilding faces 1.7% decline
First off, privately-owned construction beginnings, completions, and building permits saw a drop in percentage in March. Single-family homebuilding starts decreased by 1.7%, while completions tumbled 6.4% below February rates.
When you put things into perspective, 13% fewer homes were completed in March 2022 as opposed to March 2021.
However, multifamily had a 7.5% boost for project starts — the biggest leap since the beginning of 2020. And it’s easy to understand why.
More and more people are choosing to rent instead of buy. Statistics reflect the trend, with a +22% apartment rent increase in March alone, according to Rent.com.
This resulted in multifamily wins across the board, with the following March stats for buildings with +5 units:
- 672,000 building authorizations
- 574,000 construction starts
- 292,000 housing completions
What does this mean for real estate investors?
As an investor, everything in this latest report points to one thing, and one thing only:
MULTIFAMILY REMAINS THE #1 real estate INVESTMENT OPPORTUNITY.
No matter how you crunch the numbers, it’s obvious that apartments will continue to be in high demand — in any economy.
You can flip as many houses as you want. You still wouldn’t be able to create the wealth that dozens of units could.
Now, while the report I shared with you covers just March 2022, I know this sector will prosper month after month.
And if you’re ready to finally start taking advantage of multifamily real estate, register for my free training right now.
Disclosure: This content is intended to be used for educational and informational purposes only. Before investing, you should always do your own analysis based on your own financial and personal circumstances before making any investment. Grant Cardone is an industry expert who has been investing for over 30 years and his opinion is based solely on his own personal experience and circumstances. Individual results may vary. You should perform your own due diligence and seek the advice from a professional to verify any information on our website or materials that you are relying upon if you choose to make an investment. Investment involves great risk and there is no guarantee of performance or results.
We are not attorneys, investment advisers, accountants, tax professionals or financial advisers and any of the content presented should not be taken as professional advice. We recommend seeking the advice of financial professional before you invest, and we accept no liability whatsoever for any loss or damage you may incur.
Hey! I just wish to give a huge thumbs up for the good info you could have here on this post. I will probably be coming back to your blog for more soon.
I wanted to draft you a little note just to say thank you over again relating to the pleasing thoughts you’ve contributed on this website. It is quite surprisingly generous of people like you to present openly exactly what a few individuals might have marketed as an electronic book to get some dough for themselves, especially considering the fact that you could have tried it in the event you considered necessary. The concepts as well worked like a good way to fully grasp many people have the identical eagerness just like mine to grasp a good deal more with regard to this problem. I am certain there are thousands of more enjoyable periods up front for people who start reading your site.