Chart: Multifamily Construction Cycle Lengthens Dramatically
The average length of time to complete construction of a multifamily building, after obtaining authorization, was 19.8 months, according to the 2022 Survey of Construction (SOC) from the Census Bureau. The permit-to-completion time in 2022 was 2.3 months longer than in 2021, as supply-chain issues and the ongoing skilled labor shortage challenged the industry.
The average time to build multifamily homes varies with the number of units in the building. The more units, the more time required to build. In 2022, buildings with 20 or more units took the longest time (22.5 months) to build after obtaining authorization. Properties with 10-to-19 unit required 19.5 months, 5-to-9 unit buildings finished in 18.8 months, and lastly, 2-to-4 unit buildings came in at 18.7 months.
Compared to 2021, it took 4.5 months longer to complete multifamily buildings with 2-to-4 units, 2.1 months more for 10 to 19 unit buildings, 1.6 months longer for properties with 20 or more units, and 0.9 month longer to finish buildings with 5-to-9 units.
The 2022 SOC data also shows a significant regional variation in the average construction duration of multifamily buildings. The Northeast had the longest time from authorization to completion, 23.7 months, followed by the West, 19.5 months, and the South – 18.9 months. The shortest permit-to-completion period happened in the Midwest with 18.4 months.