There’s a housing shortage everywhere, and the country’s apartment developers are building away to meet demand.
The latest report from Rent Cafe and Yardi Matrix, whose researchers track multifamily construction nationwide, shows new apartment construction at a historic 50-year peak in 2022 with about 420,000 new units being added to the national stock before the end of the year. The last apartment boom this big was in 1972.
Business intelligence manager at Yardi Matrix Doug Ressler says the industry has returned to pre-pandemic levels despite challenges such as labor shortages, material costs and supply chain issues.
And while Dallas regularly ranks right up top for new apartment building construction each year, our city has showed notable restraint when it comes to adding large (50+ units) apartment complexes in 2021 and 2022, the researchers say. And we have slowed construction by 10% between 2021’s report and 2022’s.
For the last four years Dallas has led the nation in building large apartment complexes, but our slowdown allowed New York City to slide into the No. 1 spot.
We still have the second-highest projected number of new apartments with an expected 23,571 units added by end of year. (Compared to about 28k in NYC).
“Dallas-Fort Worth metroplex developers are more cautious when it comes to multifamily construction, even as the metro has continued to see some of the largest population increases in the country,” the authors of the report note.
This study is exclusively based on apartment data related to buildings containing 50 or more units, so they are not taking the construction of smaller multifamily properties, duplexes, accessory dwelling units or rental homes into account.
Part of the demand for apartments is the shrinking ability of the average American to purchase a home, the researchers say.
When you factor in skyrocketing house prices plus property taxes (read our latest on that from Advocate founder Rick Wamre here), rising interest rates and overall inflation, some renters have given up on, or postponed, their “American dream of ownership,” Ressler says.
He says the end of COVID-related restrictions might have added to the demand among new renters.
“People who lived with family or friends during the pandemic formed independent households as employment and savings surged.”
As for apartments already completed in 2022, Houston leads the way, followed by Austin and Seattle. In fact Dallas is at 18 insofar as completed builds at 1,507.
The full report and methodology is available here.