14 Aug Jonathan Cartu Reports Texas ranks as most active state for new apartment…
While the rest of the nation recorded a 12 percent dip in apartment construction completions during the first half of the year, Texan cities experienced a wave of new units, according to a report released today by RENTCafé.
Dallas-Fort Worth took the number one spot for the third year in a row, with 19,318 new rental units expected to be completed by the end of 2020. While first-tier cities like New York and Los Angeles have seen their populations decline in recent years, DFW grew by 117,000 residents from 2018-2019, suggest Census estimates.
The Houston metropolitan area came in third, ousted by NYC, with a total of 10,404 new apartments scheduled for delivery by year-end. H-Town saw an influx of around 90,000 residents between 2018 and 2019, but has recently been hindered by “an energy-related downturn with a decline in oil-related jobs,” explains the report.
Austin, an increasingly popular destination among Millennials and Zoomers, came in at number five with 9,342 projected completions. ATX saw its population swell by 62,000 residents from 2018 to 2019 and responded accordingly with a high-rise apartment boom. The city has added more than 50,000 new units in the last four years alone.
Austin’s neighbor to the south, San Antonio, polished off 2,871 new units in Q1 and Q2, and will likely see another 1,723 apartments wrap-up construction before the year comes to an end. This earned it second place for new apartments completed in the first half of 2020, but the number 19 spot for projected deliveries throughout the entire year.
Across the country, apartment construction hit a five-year low due to slowdowns caused by the COVID-19 pandemic. Builders are facing construction labor shortages, delays with funding and permits, and restrictive measures to prevent virus spread on job sites. All of this is likely to put a damper on multi-family construction starts within the next few years.
Doug Ressler, manager of business intelligence at Yardi Matrix — the firm that provided the data on large-scale apartment communities to RENTCafé — remains hopeful that the new construction rental market will get back on track.
“Construction starts have begun to increase from their April lows and there is cautious optimism that as the year progresses construction markets around the country will begin a modest recovery,” Ressler concluded.