Multifamily Stocks Again Break Index Record
During the month of July, the MFSI increased by slightly less than 120 points or almost 4%. With this sizeable rise, the MFSI is at its highest reading of all time, and is almost 19% higher than it was just 12 short months ago. During the past month, the value of the S&P 500 with dividends reinvested inched-up by about six-tenths of one percent and as a result, it now finds itself almost 6% above where it was one year ago.

Because the S&P 500 with dividends reinvested rose by much less than the MFSI during the month of July, the performance gap—or percentage difference—between the two indexes increased from 164% June to 172% in July, which is eight points higher than the previous all-time high of 164% set just last month. Despite the very strong 68% rise in the S&P 500 since its recent low, set in October 2002, the MFSI has risen a staggering 123% during the same 45-month time period. In addition, the MFSI continues to dramatically outperform the S&P 500 over longer time periods, including the past four, five and six years. Since December 1998, the MFSI has risen by a whopping 218% while the S&P 500 with dividends reinvested has gained a meager 17%.

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 July, the price-to-earnings ratio (P/E) of the MFSI rose slightly and now stands at 18.84 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 3.85%. The MFSI is an index of 24 publicly traded US headquartered firms, including 20 REITs, principally involved in multifamily ownership and management. [ return to top ]