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The housing market is seeing some interesting trends in the coming year, with multifamily starts predicted to decline while the remodeling sector remains strong. According to the National Association of Home Builders (NAHB), multifamily starts in the U.S. are expected to decrease in 2024, with a projected 20% drop from the previous year.
This decline is attributed to factors such as tight lending conditions, high development loan costs, and a shortage of skilled labor in the industry. However, the NAHB is forecasting a stabilization in the multifamily market by 2025, with an estimated 388,000 units to be built that year.
On the other hand, the residential remodeling sector is set to hold steady in 2024 and experience a marginal 2% growth in 2025. The demand for remodeling remains strong due to factors such as low housing inventory, aging homes, and homeowners’ increased equity.
Despite challenges such as labor shortages and material supply issues, the remodeling market continues to show resilience. The NAHB/Westlake Royal Remodeling Market Index reflects this stability, with remodelers reporting positive sentiments and a demand for skilled workers in various fields.
As the housing market navigates through these fluctuations, industry experts emphasize the importance of workforce development initiatives to address the ongoing labor shortages. Additionally, efforts to improve the availability of building materials and products are crucial in sustaining the growth of both the multifamily and remodeling sectors.
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