Developers are halting multifamily projects in urban neighborhoods as rents once at record-breaking highs begin to taper off.
Builders have been concentrating on fast-growing urban markets, attempting to attract Millennial renters with trendy amenities like rooftop pools and fire pits. As rents decline, developers are growing more selective in where to build, National Real Estate Investor reports. “Everybody fell in love with these markets and wanted to build—but you can’t build forever, it doesn’t work that way,” Reis Inc chief economist Ryan Severino says.
In S.F., where apartment construction is at a record high, rents rose 2.6% in Q2 compared to a 9.6% climb a year ago. Smaller cities like Denver and Houston also had a drop in Q2 rents. Last quarter, Atlanta rents dropped 2% to $1,305/month. [NREI]
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