2018 is predicted to be a peak year for new construction apartment units. There is currently an estimated 360,000 newly constructed apartment units hitting the market in the by the end of 2018, which is a 20% increase from the previous year.
The high demand for new construction apartment units has caused a shortage in construction labor, lengthening the amount of time it takes for a project to complete from 16.5 months to 22 months in 2017. This year, many projects are expected to finally be completed, drastically increasing the supply of apartment units in 2019. This influx of units is predicted to impact vacancy rates. In addition, the tightening of lending regulations will also slow down the rate of new construction.
Below is a list of the top 10 areas with the most new construction apartment units in 2018:
Dallas, Texas – First on the list is Dallas, which is predicted to have an addition 22,158 units completed by the end of the year. This is a 3.1% increase from the total inventory of 704,191 units at the end of 2017.
Manhattan, New York – As one of the cities with the highest demand, it is no wonder that Manhattan made the top of the list. This year, Manhattan is forecasted to complete another 21,768 units by the end of the year. This is a 4% change from the total inventory of 543,945 units in 2017.
Denver, Colorado – Next up on the list is Denver, which is predicted to add another 15,661 units in 2018. This is a whopping 6.4% increase from the total inventory of 242,296 units in 2017.
Houston, Texas – Similar to Dallas, Houston is also seeing an influx of new apartment units. Houston has added an extra 14,334 units to its’ already growing inventory of 623,369 units in 2017. This is a 2.3% increase in units from the previous year.
Miami, Florida – Although Miami’s apartment unit inventory has always been on the smaller side compared to other cities, 2018 has brought an increase of 5% to the initial inventory of 270,823 units in 2017. This will add 13,483 units to the rental market by the end of 2018.
Los Angeles, California – It is a no brainer that Los Angeles is one of the cities focusing on increasing its’ inventory in 2018. With such high demand for rentals and low supply, Los Angeles is looking to add 12,472 units to the initial inventory of 407,785 units in 2017. This is a 3.1% change from the previous year.
Seattle, Washington – Seattle is also ramping up its’ apartment units inventory this year. Developers are on track to add another 12,362 units to the original inventory of 291,315 in 2017. That is a 4.2% increase from the previous year.
Washington, D.C. – Washington has a relatively large rental market with over 505,144 units available in 2017. This year, Washington is on track to add another 11,249 units to its’ rental market, which is a 2.2% increase from the previous year.
Atlanta, Georgia – Atlanta rental market is also active this year. Last year, Atlanta had 422,154 apartment units. This year, there will be an additional 10,231 unit increase, which is a 2.4% increase from the previous year.
San Antonio, Texas – With San Antonio also entering the market, Texas seems to be on fire this year. San Antonio has a rather modest inventory at 185,509 apartment units in 2017. This year, there will be an additional 9,385 units, which is a 5.1% increase from the previous year.
As you can see, the new construction apartment unit inventory seems to be going strong in the coming year. With such high demand and low supply, owning an apartment building may prove to be an appealing venture. If you’re interested in either buying or selling your apartment building, please contact us at 818-915-9118 or email us.