Multifamily construction has decreased significantly, down 23.1% from the pandemic era. Builders initially increased activity during the pandemic due to high demand for rentals, especially in Sun Belt states. Recent developments show that rents have been flat or declining, but a slight increase in median rents is observed as the supply of new apartments shrinks. The Sun Belt region remains active in new housing developments despite a general slowdown in multifamily permits, with many metros experiencing declines.
The surge in building during the pandemic was driven in part by Americans relocating under remote work policies, particularly to high-demand Sun Belt states such as Texas and Florida.
Asking rents may now be ticking up because the pool of new apartments renters have to choose from is shrinking while demand for rentals is growing.
While many Sun Belt cities have seen permitting slow since the pandemic, the region still outpaces others in new housing development.
Fifty-nine percent of the metros studied saw a decrease in multifamily permits compared with the pandemic period.
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