New construction is booming all over the country

Wanda Voight
Jun 8, 2023
1 min read

What will a wave of new supply mean for apartment rents?

More than 950,000 multifamily units are under construction across the country, according to the Census Bureau, and a recent Green Street report suggests that the Sun Belt could be particularly exposed to the new supply.

The wave of development could affect rental rates, although both Camden Property Trust and MAA indicated during earnings calls that they expect any negative impact to be short-lived.

Over 14,500 new single-family rental homes were constructed across the country in 2022. This marks an all-time high, up 47% from 2021 and more than double the peak yearly construction rate before the COVID-19 pandemic, according to a new study from RentCafe.

The trend shows no sign of slowing. Nearly 44,700 new build-to-rent homes — defined in the study as horizontal apartment-style units in neighborhoods of 50 or more — are underway across the country.

Phoenix has the busiest pipeline with 5,500 build-to-rent homes under construction, followed by Dallas at 4,400 and Houston at 2,600.

RentCafe attributes the surging growth of the BTR sector to the lifestyle changes brought on by the COVID-19 pandemic, including social distancing and working from home, as well as high housing prices and interest rates that make purchasing a difficult prospect.

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