Following a slowdown last year, multifamily deliveries are expected to hit a peak in 2018. An estimated 360,000 new units are slated for delivery over the next 12 months, which is a 20% increase over 2017, according to a new Yardi Matrix report.
As of the fourth quarter, approximately 600,000 units were under construction across the U.S., but in the last three quarters of 2017, only 220,000 units were delivered nationally. This disconnect between construction and delivery has been attributed to the construction labor shortage, which caused the average project completion time to increase to 22 months during the same period, up from 16.5 months in the third quarter of 2013.
This year is expected to bring a rise in completions as units under construction reach the finish line, but new supply is predicted to level off in 2019 as an increase in vacancy rates coupled with construction lending regulations are causing some developers and lenders to exhibit caution moving forward.
Nearly half of all anticipated completions this year will be in the top 10 markets with Dallas leading the pack. The city is expected to deliver more than 22,000 units over the next year and this growth is likely to continue thanks to the city's healthy economic climate.
Here are the 10 markets that will see the most new apartment supply this year, according to Yardi Matrix:
No. 1: Dallas
Total Inventory: 704,191 units
Forecast Completions: 22,158 units
% Change: 3.1%
No. 2: Manhattan, New York
Total Inventory: 543,945 units
Forecast Completions: 21,768 units
% Change: 4%
No. 3: Denver
Total Inventory: 242,296 units
Forecast Completions: 15,661 units
% Change: 6.4%
No. 4: Houston
Total Inventory: 623,369 units
Forecast Completions: 14,334 units
% Change: 2.3%
No. 5: Miami
Total Inventory: 270,823 units
Forecast Completions: 13,483 units
% Change: 5%
No. 6: Los Angeles
Total Inventory: 407,785 units
Forecast Completions: 12,472 units
% Change: 3.1%
No. 7: Seattle
Total Inventory: 291,315 units
Forecast Completions: 12,362 units
% Change: 4.2%
No. 8: Washington, D.C.
Total Inventory: 505,144 units
Forecast Completions: 11,249 units
% Change: 2.2%
No. 9: Atlanta
Total Inventory: 422,154 units
Forecast Completions: 10,231 units
% Change: 2.4%
No. 10: San Antonio
Total Inventory: 185,509 units
Forecast Completions: 9,385 units
% Change: 5.1%
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