The New Normal: Multifamily Takes the Lead
The cabinet industry is undergoing a significant recalibration as the residential construction landscape shifts beneath it. For years, single-family homes drove demand for premium, custom cabinetry. But with interest rates stubbornly high and affordability constraints squeezing the for-sale market, builders and developers are pivoting to multifamily housing—apartments, condominiums, and townhomes—where the need for cost-effective, standardized cabinetry is rising fast.
According to the U.S. Census Bureau, privately-owned housing units in buildings with two or more units were at a seasonally adjusted annual rate of 139,000 in June 2024, up 4% from June 2023 [1]. This marks a sustained expansion in the multifamily sector at a time when single-family starts have flattened or declined. The implications for cabinet manufacturers, dealers, and designers are clear: demand is moving away from one-off, high-dollar custom kitchens toward repeatable, budget-conscious packages.
Data from the Kitchen Cabinet Manufacturers Association (KCMA) confirms the trend. Sales of custom cabinets fell 4.1% in April 2024 compared to April 2023, while stock cabinets grew 1.2% [2]. The contrast is stark and reflects a broader market shift. At the same time, the National Kitchen & Bath Association’s 2024 Design Trends Report finds that 62% of designers report clients opting for budget-friendly cabinetry, up sharply from 48% in 2023 [3]. This convergence—more multifamily construction plus tighter budgets—is forcing the entire supply chain to adapt.
The Multifamily Boom: What’s Driving It?
Interest Rates and Affordability
High mortgage rates, which have hovered above 7% for much of 2024, have priced many first-time buyers out of the single-family market. In response, builders are redirecting capital toward multifamily projects, which offer faster lease-ups and more predictable returns. Rental demand remains strong, particularly in Sun Belt metros and suburban job centers where workers cannot afford to buy.
The Census Bureau’s June 2024 report shows that multifamily starts have not only recovered from the pandemic-era dip but are now running well above pre-2020 levels [1]. This growth is broad-based: from luxury high-rises in coastal cities to garden-style apartments in the Midwest, the common denominator is the need to outfit thousands of units with kitchens that are functional, durable, and cost-conscious.
Developer Preferences Drive Material Choices
Multifamily developers and general contractors are under intense pressure to control costs. They typically purchase cabinetry in bulk for entire projects, seeking consistent quality, short lead times, and predictable pricing. This naturally favors stock and semi-custom cabinets, which are mass-produced to standard dimensions and often assembled in large runs. Custom cabinetry, with its bespoke sizing and premium materials, is rarely specified in rentals or even for-sale condos where square footage is at a premium.
For cabinet dealers, this means rethinking inventory. Many are increasing their floor space dedicated to stock lines, negotiating volume discounts with suppliers, and training sales teams to upsell within semi-custom ranges rather than pushing full custom projects that may never materialize.
The Numbers Behind the Shift
The KCMA data from April 2024 provides a snapshot of changing consumer behavior. While the overall cabinet market has been flat to slightly down, the composition is shifting [2]. Custom cabinet sales—historically the high-margin darling of the industry—declined over 4% year-over-year. In contrast, stock cabinets, which carry lower margins but higher velocity, saw a modest gain.
This is not a blip. The NKBA survey underscores that budget awareness is now the norm, not the exception [3]. Designers report clients are actively seeking ways to save—choosing thermofoil doors over solid wood, opting for painted MDF, and selecting stock sizes to avoid custom fabrication charges. This trend is likely to persist as long as housing affordability remains stretched.
Additionally, input costs are aligning to support stock production. Particleboard, a key raw material for stock cabinets, has become cheaper. Random Lengths reports that particleboard prices averaged $125 per thousand square feet in July 2024, down 10% year-over-year [4]. Lower material costs improve margins on high-volume stock lines, making them even more attractive for manufacturers and dealers.
Implications for Cabinet Dealers
Adjusting Sales Strategy
Dealers who have traditionally focused on custom work need to pivot. The multifamily pipeline is large and steady, but it demands a different sales approach. Instead of bidding on individual kitchens, dealers must position themselves to win contracts for entire apartment complexes or condominium buildings. This requires expertise in value engineering, bulk pricing, and installation logistics.
Recommendations:
- Build relationships with multifamily general contractors and developers. Attend industry events like the Multifamily Executive Conference or local apartment association meetings.
- Offer tiered product lines: a basic stock line for cost-sensitive projects, a semi-custom line where design flexibility is valued, and a custom option for high-end units (though likely a small portion).
- Develop standardized packages (e.g., “Studio Kitchen,” “One-Bedroom Kitchen”) that can be repeated across units, reducing design time and material waste.
Inventory and Fulfillment
Stock cabinets move quickly but require ample warehousing. Dealers may need to invest in larger showrooms or distribution centers that can hold pallets of boxed cabinets. Just-in-time delivery is critical in multifamily construction, where delays cascade. Partnering with manufacturers who can guarantee 2–4 week lead times on stock orders is essential.
Semi-custom cabinets, which allow some modification (e.g., door style, color, size increments), offer a middle ground. They satisfy the desire for a differentiated look in rent-by-owner condos while still benefiting from partial standardization. Dealers can stock a core selection of semi-custom fronts and boxes, then assemble-to-order.
Implications for Kitchen Designers
Embracing Value Engineering
Designers accustomed to specifying high-end custom cabinetry must adapt their practices for multifamily projects. This does not mean sacrificing aesthetics—it means working smarter with the materials and configurations that deliver the most bang for the buck.
Key tactics:
- Specify stock cabinet sizes (e.g., 12-inch, 18-inch, 24-inch widths) to avoid custom fillers and reduce overall cost.
- Use thermofoil, laminate, or painted MDF doors instead of solid wood; these materials are durable and cost a fraction of the price.
- Recommend open shelving for upper cabinets in small kitchens—this reduces material use and can be trendy.
- Optimize layout for efficiency: fewer upper cabinets, more drawer bases, standard 30-inch sinks.
The NKBA report indicates that 62% of designers are already seeing clients prioritize budget [3]. Designers who can demonstrate cost savings without compromising the look will win repeat business from developers and property managers.
Specification Considerations
For multifamily projects, durability and ease of maintenance are paramount. Cabinets must withstand turnover cycles and frequent cleaning. Semi-gloss painted finishes are popular because they are easy to wipe down. Dovetail drawer boxes with full-extension slides are an upgrade that many builders view as worthwhile. Soft-close hinges are now standard, even in economy lines.
Dealers and designers should collaborate on material selections that balance first cost with lifecycle cost. Particleboard with melamine surfaces, for instance, offers water resistance and low price—especially now with particleboard prices down 10% year-over-year [4]. This is a win-win for developers and end users.
Implications for Builders and Procurement Professionals
Bulk Buying Power
For procurement professionals at multifamily development firms, the current market is favorable. With custom cabinet sales declining and stock/semi-custom inventory abundant, builders can negotiate favorable terms. The drop in particleboard prices gives suppliers room to offer competitive quotes without sacrificing margin.
Procurement tips:
- Request pricing for multiple phases at once to lock in rates and secure volume discounts.
- Standardize cabinet specs across all projects within a portfolio to simplify ordering and installation.
- Consider partnering with a single cabinet manufacturer for all phases to streamline lead times and coordination.
Installation and Takedown
Multifamily installations are repetitive but high-volume. Builders should work with dealers who can provide consistent installation crews trained on the specific product lines. Pre-assembled stock cabinets are typically preferred because they reduce on-site labor time. However, some semi-custom lines ship as RTA (ready-to-assemble) to save on freight—this can be factored into the budget.
Conclusion: Adapt or Miss the Wave
The cabinet market is realigning in real time. The 4% rise in multifamily starts [1], the 4.1% drop in custom cabinet sales [2], the surge in budget-conscious design preferences [3], and falling particleboard prices [4] all point in the same direction: the future of the kitchen cabinet business lies in standardized, cost-effective solutions.
Dealers who retool their inventory and sales approach for the multifamily sector will capture a growing stream of revenue. Designers who master value engineering will be indispensable to developer clients. Builders and procurement professionals who leverage bulk buying and careful specification will keep projects on schedule and under budget.
The single-family slowdown is not a crisis—it is an opportunity to pivot. The multifamily segment is booming, and the cabinet industry’s most successful players will be those who embrace stock and semi-custom lines with the same creativity and professionalism they once reserved for custom projects.