Multifamily Stock Index and Stock Market Both Show Strength
During October, the MFSI rose by almost three points, slightly less than a sixth of a percentage point. With this tiny rise, the MFSI is at its second-highest value ever recorded, and is almost 28% higher than 12 months ago. Since the end of September 2003, the S&P 500 with dividends rose by almost 6%, and is now 21.2% higher than 12 months ago — a performance almost six percentage points worse than the MFSI. Because the MFSI barely increased during October while the S&P 500 with dividends increased by almost 6%, the percentage difference between the two indexes declined from 99% to 88%, a level surpassed on only 12 previous occassions.

Despite a strong showing by the S&P 500 over the past year, the MFSI continues to outperform the S&P 500 over the past one-, two-, three-, and four-year time time periods. Since December 1998, the MFSI has risen by more than 72% while the S&P 500 with dividends has fallen by 18%. During the past month, the price-to-earnings ratio (P/E) of the MFSI fell from 18.46 to 18.11, while the dividend yield, defined as the total cash dividend payments divided by the current stock price, rose from 6.61% to 6.64%.

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.

The MFSI is an index of 28 publicly traded US headquartered firms, including 23 REITs, principally involved in multifamily ownership and management. [ return to top ]