For the last four years, the Dallas-Fort Worth area lead the country in new apartment developments, but a recent study published by RentCafe reports that it has fallen second behind the New York City area.
According to the study, despite pressing economic concerns and supply chain disruptions in the aftermath of the pandemic, multifamily unit construction is at a historic 50-year peak. As previously covered by Local Profile, many renters are being priced out of their dreams of becoming homeowners due to inflation and ever-rising interest rates, making rent the more affordable option.
After some seatbacks in previous years and a significant 1.6% population decrease in 2021, New York has made a comeback with a whooping 28,153 brand new rental apartments getting finished before the end of the year, almost 50% more than what was completed last year. Meanwhile, the DFW area is expected to add 23,571 new units this year, 10% less than its 2021 levels, despite the rapid population growth the area has experienced recently.
And New York is not alone in this trend. This demand for apartments is a nationwide phenomenon that is driving the current apartment construction boom. RentCafe’s study shows that developers in half of the top 20 metros in the country are projected to break their apartment building records for the last five years.
In Miami, the third metro area with the highest number of apartments opening this year, developers have plunged into a building spree trying to keep up with the skyrocketing rental unit demand.
Yet on a city-level comparison, Texas cities are still rushing to meet the demand for apartments. Four Texas locations made it to RentCafe’s top 20, with Houston at the lead with 4,746 built only in the first half of 2022. Following are Austin, adding 4,236 apartments to the market in the same period, San Antonio with 2,394 new units and Dallas with 1,507 units.
According to said Doug Ressler (via RentCafe), manager of business intelligence at commercial real estate research source Yardi Matrix, “The construction industry is finally returning to pre-pandemic levels of activity but is still being hampered by three familiar challenges: labor shortages; material costs and availability; and supply chain issues.”