Multifamily Stocks Again Show Record Performance
During the month of January, the Multifamily Stock Index (MFSI) jumped by 328 points, or a shade more than 9%—its fourth-biggest monthly rise ever. With this huge increase, the MFSI finds itself at at yet another all-time high—its eighth in the past 12 months—and is more than 35% higher than it was last tyear at this time. During the past month, the value of the S&P 500 with dividends reinvested jumped by 1.5% and, as a result, it now finds itself almost 15% above where it was one year ago.

Because the MFSI rose by about six times a much as the S&P 500 with dividends during the month of January, the performance gap—or percentage difference—between the two indexes jumped from 169% last month to 190% in January, its highest reading ever. Despite the very strong 91% rise in the S&P 500 since its recent low set in October 2002, the MFSI has risen a staggering 170% during the same 52-month time period.  In addition, the MFSI continues to dramatically outperform the S&P 500 over longer time periods including the past five, six and seven years. Since December 1998, the MFSI has risen by a whopping 285% while the S&P 500 with dividends reinvested has gained a meager 33%.

                 ¹ For initial article discussing the MFSI in detail see NAHB Multifamily Market Outlook, January 2002.            ² Percent difference is defined as (MFSI minus S&P 500 with dividends)/S&P 500 with dividends

During the month of January, the price-to-earnings ratio (P/E) of the MFSI strengthened and now stands at 21.94 while the dividend yield, defined as the total cash dividend payments divided by the current stock price, and which moves in the opposite direction eased to 3.09%. The MFSI is an index of 23 publicly traded US headquartered firms, including 19 REITs, principally involved in multifamily ownership and management. [ return to top ]