RISMedia’s Post

Yardi Matrix Anticipates Slowdown in New Construction in 2024 Multifamily construction starts declined in 2023, but exceeded expectations considering the turmoil in the financial markets. A new report on multifamily construction starts from Yardi Matrix states that the number of units that broke ground in 2023 ranks third in recent years, behind 2022 and 2021. https://lnkd.in/gYzwnVqY

According to this new study on multifamily housing construction . . . (1) The permit and planning phases take longer than construction. (2) Regionally, total project delivery times are longest in the western US. (3) Conversions take longer than new-build. Link to the paper in the comments.

2023 Multifamily Construction: Growing Share of Low-Medium Density Buildings Multi-Family Build Outs slowing down as Build to Rent Heats Up and will Remain Heated #BTR #dscr #assetbasedlending https://lnkd.in/eqWBtw25

In 2023, Atlanta experienced a record-breaking year for multifamily construction, leading to the largest-ever divergence between overall and stabilized vacancy rates. Stabilized properties, with at least 90% occupancy or open for 18 months, have a vacancy rate of 9.5%, while the overall vacancy rate, including new projects still leasing, stands at 12.4%. This gap highlights the differing challenges faced by property owners competing with new developments versus those with stabilized properties. Historically, the gap averaged about 120 basis points pre-pandemic but has recently expanded significantly. The high stabilized vacancy rate is impeding rent growth, currently at a negative 2.3% year-over-year. Despite recent construction slowing, Atlanta's multifamily inventory saw substantial growth, adding nearly 24,000 units in the past year. Increased competition has led to more properties offering concessions, with 39% now providing incentives compared to 6% in early 2022. Both vacancy rates are expected to remain stable this year, with a return to positive rent growth anticipated in 2025 as the construction pipeline diminishes.

Multifamily Supply Wave Recedes as Construction Activity Declines Despite a national oversupply, the multifamily market shows signs of stabilization. Forecasted completions for 2024 are down 10% from the previous year. However, markets like Austin and San Antonio will see increased supply, impacting vacancy rates and rent growth. The construction pipeline has slowed significantly, with fewer units under construction and new project initiations facing challenges. This trend could shift the market from oversupplied to undersupplied by 2026. Read the full article here: https://lnkd.in/gKsRZaQK How are you preparing for potential shifts in the supply and demand dynamics of the multifamily market?

Is the Multifamily market beginning to get back to "normal"? As the supply that entered the market gets absorbed, we should see vacancy rates and rents stabilize. Could there be a reversal given the slow in new construction starts? Time will tell.

"Multifamily construction spending stayed flat in July after a dip of 0.6% in June. Year-over-year, spending on multifamily construction declined 6.7%, as an elevated level of apartments under construction is being completed. Private residential improvement spending increased 1.2% in July and was 18.3% higher compared to a year ago." #construction #suretybonds #bondwiththebest https://lnkd.in/g-h6KBNK.

Multifamily construction starts plunged 36% in January, the biggest drop since the pandemic began!🤯 Experts weigh in on the factors causing the slowdown and what it means for renters, developers, and the overall housing market. More information here: https://buff.ly/3T2ZTp2 #CRE #CRENews #MultiFamily

Multifamily construction costs are soaring. At the same time, new construction is slowing. If you're planning to build an apartment complex, you'd better know what you're doing. Use our free calculator to calculate your costs. https://hubs.la/Q02ldnMN0

"New construction deliveries reached a new high of 140,800 units in Q4 2023, bringing the four-quarter total to a record 416,500. Fewer construction starts in recent quarters indicates there will be a decrease in deliveries in 2025 and beyond..." #housingmarket #realestate #housingaffordability #homeconstruction #multifamilyconstruction #housingdemand https://lnkd.in/gEQ77ebK