Not Much Danger Of Multifamily Overbuilding: Phoenix Will Need 150,000 More Apartments By 2030
The Phoenix metro area is expected to need more than 150,000 new apartments by 2030 to keep up with local demand, according to a new study commissioned by the National Multifamily Housing Council and the National Apartment Association, with research by Hoyt Advisory Services.
There are a number of drivers of demand locally for new apartments, according to the study: an aging population, international immigration and fewer home purchases. Nationally, 4.6 million new apartments will be needed by 2030, driven by the same factors, though for the Phoenix area some of the drivers will be more intense (especially the aging population).
An average of 3,280 investment-grade units were built annually between 2011 and 2016, according to Axiometrics data. Phoenix will need to average 10,736 units/year (in buildings of five or more units) to meet the expected demand.
The Phoenix metro area also will need all types of apartments and at all price points, and will need to increase its existing number of apartments by 38% by 2030. The market ranks No. 6 out of 50 metro areas in terms of the percent increase in demand for new apartments by 2030, the study noted.