As the coronavirus pandemic drags on and on, its long tentacles keep messing up more and more things. The latest example: apartment construction.
That’s according to a new report, out Monday, from the National Multifamily Housing Council (NMHC). The report reveals that 57 percent of multifamily developers have reported delays in their projects recently. Of those who reported delays, 83 percent said the cause was “permitting due to COVID-19,” the report adds.
The findings are based on a survey of 61 leading multifamily construction firms. The NMHC conducted the survey earlier this month and it was the fourth time the trade group has collected responses since the pandemic began in the U.S. in March.
The latest findings had the largest number of respondents reporting delays. When the NMHC collected responses in May, only 53 percent of survey participants said their projects had been delayed. In mid-April, it was 56 percent and in late March it was 55 percent.
However, the percentage of respondents who attributed project delays this month to the pandemic “was virtually unchanged” from the 85 percent who said the same thing in May, the report also states. In April and March, 77 percent and 76 percent, respectively, attributed delays to the pandemic.
Those findings suggest that at least when it comes to delays, the impacts of the outbreak might be holding relatively steady at this point, rather than getting significantly worse.
However, survey respondents also reported “a significant pause in starts, with 71 percent reporting delays,” the report notes. That number was down slightly from May, when 78 percent of respondents reported delays in construction starts, but up from April and March, when 70 percent and 59 percent of respondents, respectively, said construction starts were delayed.
A majority of respondents, or 52 percent, additionally said they believe the delayed starts will last less than six months. Another 44 percent said they thought the delays will last as long as a year.
Other takeaways from the survey include that a growing number of respondents have said that they’re being impacted by a lack of building materials, and that materials are apparently becoming more expensive.
The pandemic has assailed housing on multiple fronts over the last several months. Among other things, millions of homeowners have ended up in mortgage forbearance programs because they could not afford their payments, and the crisis has derailed the homeownership dreams of many renters. Overall, a third of Americans missed housing payments in July.
Some observers have predicted continued economic fallout in the immediate future, but the impacts on the building industry could potentially translate into longer-lasting issues. For instance, inventory shortages have infamously helped drive up housing costs, especially in already expensive areas, and construction delays now could mean that supply shortfalls linger even when the outbreak itself abates.
There are, however, some relatively positive signs as well. The report notes, for example, that 52 percent of respondents indicated they “implemented new strategies to deal with the hurdles formed by the virus’s continued presence.” Moreover, only 2 percent of respondents to the latest survey said that their projects were canceled thanks to the pandemic’s fallout.
