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Elevated Apartment Demand Outpaced by New Deliveries
Despite above-average apartment demand in the first quarter of 2024, an even heavier influx of new supply continued to weigh down rent and occupancy figures, RealPage Market Analytics said Friday. Although U.S. apartment markets absorbed 103,826 units in Q1, there were 135,652 apartment
units completed nationwide during the same time period.
“New apartment supply continues to be the primary influence on national performance,” said RealPage senior director of research and analysis Carl Whitaker. “We’re sitting at the highest annual supply figure dating back to 1986, when approximately 550,000 new units were delivered.”
He added, though, “it’s important to note that today’s relative expansion rate of 2.5% remains comfortably below the 1986 expansion rate of 3%.”
The strong quarterly absorption tally brought annual demand to stand at 317,241 units absorbed in the year ending March 31. That rate registered about 20% higher than a typical annual absorption rate from the 2010s.
“Fueling this demand strength is a confluence of factors, including persistent wage growth (which has now outpaced rent growth for 16 straight months), solid job growth, demographic tailwinds and arguably the lowest level of move-outs from apartment units and into single-family homes since the Great Financial Crisis,” Whitaker said.
- ◦Lease
- ◦Development
