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Apartment construction showing signs of a slowdown
Units under construction leveling off from 42-year high reached in early 2017
The red-hot U.S. apartment construction market is starting to cool down.
Although the apartment supply skyrocketed in recent years, largely in response to the recession, multiple reports now show it may have reached its peak, according to Bloomberg.
A new report from the U.S. Department of Commerce showed that multifamily units were being completed in October at their fastest annualized rate in about 30 years, and after hitting a 42-year high at the beginning of 2017, the pipeline of apartments under construction has started to level off.
Construction on apartments could drop by 8 percent in 2018, which would be the second consecutive year of decline, and rental vacancies have hit a two-year high.
This shift could lead to slower increases in rent and make more construction workers available to work on other projects, such as single-family homes. [Bloomberg] – Eddie Small