The oversupply narrative begins to dissipate as permits drop in key markets.
Right now, there are a total of approximately 100,000 apartments due to come on line in Dallas, New York City and Atlanta.
But beyond those apartments, things drop off, according to GlobeSt.’s Paul Bubny.
Citing RealPage data, Bubny writes that there are only about 23,000 apartments that have been approved by regulators and are scheduled to begin construction in 2018. That is not enough. NAA data says that Dallas alone will need 266,000 new apartment households by 2030 to keep pace with demand.
“Other markets with healthy construction activity, such as Seattle and Houston, similarly have worked through much of their development pipelines at this point,” Bubny writes. “RealPage says the two metro areas have fewer than 4,000 units apiece in the planning stages as of Q3 2017.”
While San Francisco, Oakland, Columbus, Fort Lauderdale, West Palm Beach and Cleveland, have more planned units than what is currently under construction, those locales are outliers.
“As of Q3, a sizable majority of the top 50 metro areas had more units under construction than in the pipeline, according to RealPage data,” Bubny writes. “In all, the top 50 metros combined for approximately 506,000 units under construction at the end of Q3, while totaling around 229,000 planned units at the same time.”