NMHC Survey Finds Growing Optimism in Multifamily Construction

Developers See Path to Recovery

According to the National Multifamily Housing Council’s (NMHC) June 2026 quarterly construction survey, the long-range mood among apartment builders and developers is tilting positive. Nearly 46% of those surveyed foresee improved project conditions over the next six to 12 months, MFE reports, while only 14% anticipate further deterioration. However, caution prevails in the short term—77% of respondents expect more of the status quo through summer and early fall.

This sentiment shift stands out in a year when persistent inflation, elevated financing costs, and supply chain kinks have clouded new multifamily development nationwide. Yet, with consumer price growth running hot—an annualized 8.2% from February to May per the Consumer Price Index—CRE leaders are watching both opportunity and risk signals in tandem.

Pessimism Fades but Cautious Optimism Takes Hold

Over the past year, multifamily construction sentiment swung between delays and budget pressures. The June 2026 NMHC survey shows a modest reset. About 55% of respondents said multifamily starts held steady since March. Meanwhile, 20% reported fewer construction delays than last quarter. However, only 10% expect improvement over the next three months. Another 13% expect conditions to worsen.

Inflation continues to shape that cautious outlook. According to NMHC’s Chris Bruen, “Consumer prices rose by an annualized rate of 8.2% between February and May.” Higher inflation could raise construction input costs, squeeze project margins, and delay new projects. As a result, many developers still wait for borrowing costs or pricing pressures to ease.

The Details

The June 2026 survey included leading national multifamily developers and general contractors. About 46% expect construction conditions to improve within one year. Meanwhile, 37% believe construction costs will outpace overall inflation. Another 51% expect equity capital access to improve, while only 10% expect weaker access.

Debt markets also showed modest improvement. About 28% expect better funding availability, while 7% expect less. Additionally, 55% said multifamily starts remained unchanged since March. One in five also reported fewer construction delays during the same period.

Capital Market Headwinds and Supply Resilience

Compared with late 2025, capital markets show signs of improvement. Earlier rate hikes and banking stress stalled debt and equity activity. Now, respondents report stronger confidence in equity markets and modest improvement in debt financing. Additionally, 46% expect construction conditions to improve within a year. This improving outlook aligns with broader industry surveys showing stronger confidence in multifamily demand and investment through 2026.

Still, rising costs remain the biggest obstacle. About 37% expect construction expenses to outpace inflation. Therefore, many developers continue adjusting return targets before launching projects. Others focus on markets with stronger rent growth or wider investment spreads. Meanwhile, fewer construction delays suggest supply chain conditions continue improving. That trend could help active projects finish faster.

Why It Matters

Growing long-term optimism, despite persistent inflation, could mark a turning point for US multifamily development. Most metros still need additional housing supply. Moody’s Analytics estimates a shortage exceeding 3.2M rental units as of March 2026. Meanwhile, stronger capital access supports that outlook. About 51% expect easier equity financing, while 28% expect better debt availability.

Cost pressures remain a major challenge. About 37% expect construction costs to rise faster than inflation. Consequently, many projects still struggle to achieve acceptable returns. Markets without strong rent growth or incentives face greater pressure. Still, more respondents now expect improvement than further deterioration. The market appears to be adjusting to current conditions. Capital providers, builders, and operators continue refining their risk and return expectations. CRE professionals should stay flexible and closely monitor local rent trends.

What’s Next

Costs, interest rates, and labor conditions will continue shaping construction activity. Therefore, future NMHC surveys will provide important signals about market direction. Expect more developers to pursue creative capital structures. Equity partnerships and public-private models could become more common.

Regional differences will also matter. Markets with stronger rent growth and fewer regulations should recover first. Those areas could see permits and construction activity rebound sooner. Meanwhile, weaker markets may remain on hold. CRE leaders should monitor both sentiment and actual project starts. That combination will show when optimism becomes new supply.