Material shortages will almost certainly lead to development cost increases and project delays in the multifamily sector as rapidly rising prices continue to trouble the construction industry. 

A new survey from the National Multifamily Housing Council shows that builders are increasingly concerned about supply constraints and increasing costs, with 40% of respondents citing price increases north of 20% for their most impacted materials. And those concerns are led, of course, by continuing stress surrounding the sky-high price of lumber which is "creating a serious impediment for apartment developers and construction firms," NHMC vice president of research Caitlin Walter writes in a recent piece analyzing the data. 

"Material shortages and cost increases will lead to development cost increases and potential project delays," Walter said. "Builders and contractors can attempt to offset these issues by either substituting materials (if possible) or assuming higher costs for the materials in their budgets. However, longer term, these disruptions could challenge the already supply-constrained market and threaten to derail housing affordability efforts. New units need to be built at a variety of price points, and cost increases only make building those units more difficult."