Multifamily construction has entered a new phase in 2025, facing delays, cost pressures, and project repricing nationwide. The National Multifamily Housing Council’s (NMHC) most recent quarterly survey, released this June, offers a revealing snapshot of just how developers are coping and where the industry may be headed next.
Multifamily Construction: Surprising Delays and Disruption
The NMHC’s updated survey, gathering insights from 47 top multifamily construction and development firms, highlights a market still struggling with delays, but also showing signs of resilience. While construction holdups remain a persistent headache, there is a silver lining: things are improving, albeit slowly.
In June 2024, a staggering 70% of respondents reported experiencing building delays. Fast-forward to June 2025, and that figure has dropped to 43%. Nearly half of the firms surveyed (49%) said they’re not currently facing delays, and 9% didn’t respond. Regional differences are notable, too. The Southeast, for example, saw a drop in reported delays from 47% to 35% year-over-year. Other regions reported fewer issues, with only 5% to 15% of respondents citing delays.
Permitting: The New Bottleneck
While construction delays are easing, permitting has become a significant obstacle. As of June 2025, a whopping 85% of respondents said they’re facing disruptions in securing permits, up from 77% the previous year. Only 10% reported no issues, and 5% didn’t respond.
The wait times for permits are sobering. Only 11% of respondents said they could expect to receive permits within two months. For 38%, the wait stretches to three or four months. Seventeen percent are looking at five to six months, 6% at seven to eight months, and a significant 13% face waits of at least nine months. These delays can derail project timelines and add uncertainty to an already volatile market.
Project Starts: Gradual Improvement
Despite these challenges, there are reasons for cautious optimism. In 2024, 84% of respondents reported delays in starting projects. By June 2025, that number had dropped to 70%. While still high, the trend is moving in the right direction. Twenty percent now say they’re not experiencing delays, and 10% didn’t respond.
The Financial Squeeze: Repricing and Cost Concerns
Perhaps the most telling sign of the market’s volatility is the widespread repricing of deals. In the second quarter of 2025, 72% of respondents reported seeing deals repriced. This is a clear reflection of the uncertainty developers face, as shifting costs and economic conditions force everyone back to the negotiating table.
Looking ahead, expectations for construction costs remain mixed. Over the next six to twelve months, 52% of respondents anticipate rising costs, while 20% expect a decrease and 26% foresee stability. Narrowing the window to three to six months, 46% expect increases, 15% predict decreases, and 37% think costs will hold steady.
Labor: A Looming Challenge
Labor availability remains a wildcard. In the short term (three to six months), 28% of respondents expect labor to become more available, 30% predict it will become scarcer, and 37% see little change. Looking further out (six to twelve months), 43% anticipate labor shortages, 22% expect improvement, and 28% foresee no change.
What Does This Mean for Developers and Investors?
The NMHC’s survey paints a picture of an industry in flux. While some challenges are easing, such as construction delays, others, like permitting and repricing, are intensifying. For developers, this means staying agile, building strong relationships with local officials, and being ready to pivot as market conditions evolve.
For investors, the message is equally clear: due diligence is more important than ever. Understanding the local regulatory environment, supply chain dynamics, and labor market trends can make the difference between a successful project and one mired in delays and cost overruns.
Moving Forward: Adaptability is Key
The multifamily market has always been dynamic, but the current environment demands a new level of flexibility and foresight. Developers and investors who can adapt quickly, manage risk, and embrace change will be best positioned to thrive as the market continues to evolve.
If you’re navigating these challenges, you’re not alone. The NMHC’s data-driven insights provide a valuable roadmap for understanding where the market stands and where it may be headed next. Our multifamily loan team at JBN Capital LLC specializes in providing tailored financing solutions for multifamily refinances, acquisitions, rehabs, partner buyouts, and cash-out loans. We offer commercial real estate loan options designed to meet the needs of investors and business owners nationwide. Contact us on LinkedIn.
