Multifamily completions are scheduled to hit 371,000 in 2020, a 50% increase from 2019. Still, new 2020 construction starts are expected to remain steady, causing 2021+ deliveries to be more in-line with prior years. It is estimated demand will be met at a consistent 328,000 units per year. Finally, CBRE ranked the hottest markets for 2020 developers (based on growth), and all markets have less than 2 million residents.

Below are key takeaways from the following reports:

RealPage Reports a Surge in Scheduled Apartments Completions in 2020 – RealPage – Link

NAHB: Multifamily Construction Starts Will Rise Just 1% in 2020 – ConstructionDive – Link

CBRE Ranks the Hottest Multifamily Markets for 2020 – ConstructionDive – Link

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RealPage Reports a Surge in Scheduled Apartment Completions in 2020

RealPage

• The U.S. apartment market is set to receive more new units in 2020 than it has in any of the past 30 years
• About 371,000 apartments are scheduled in 2020, a 50% increase from 2019. The scheduled new supply adds about 17% to the more than 2 million new apartments built over the past decade.
• Absorption is expected to be strong, as U.S. apartment occupancy reached near-record levels and rents grew by 2.8% in 2019

NAHB: Multifamily Construction Starts Will Rise Just 1% in 2020

ConstructionDrive

• Despite increasing demand, multifamily construction starts rose just 1% last year to 381,000 and are expected to increase 1% to 383,000 in 2020, followed by a 4% increase to 399,000 in 2021, according to the National Association of Home Builder
• To meet U.S. demand for multifamily housing, the industry needs to build about 328,000 units a year, which has only occurred twice since 1989, Sarah Yaussi, a spokesperson for the National Multifamily Housing Council (NMHC), told Construction Dive

CBRE Ranks the Hottest Multifamily Markets for 2020

ConstructionDrive

• Developers would do well, according to CBRE, to focus investment on smaller markets with fewer than 2 million residents. It cited a range of these types of cities that had 4% or greater rent growth as of the third quarter of 2019, including:
  • Albuquerque, New Mexico
  • Birmingham, Alabama
  • Colorado Springs, Colorado
  • Greensboro, North Carolina
  • Memphis, Tennessee
  • Dayton, Ohio
  • Tucson, Arizona