Across the country apartment construction is booming, according to a report published on Tuesday by the website RentCafe.
But not in L.A.
Nationally, more than 400,000 new apartments are expected to be delivered this year, the report found, the highest figure since 1972. Meanwhile, in the West Coast’s biggest metro market around 11,500 apartments are expected to come in.
That number is a the lowest the region has seen in five years, according to RentCafe, even as L.A. — and most of coastal California — faces a well-documented housing shortage that has driven rents up and residents out. One report published earlier this summer, from the group Up for Growth, put California’s housing deficit at nearly a million units, more than three times the figure for Texas and more than four times the number for New York.
Another report, published in April by Kidder Mathews, showed that multifamily construction in the city was actually heading in the wrong direction. Compared to a year earlier, new construction in the first quarter of this year plunged by nearly half, from over 3,400 starts in early 2021 to roughly 1,800, according to that report. Analysts blamed that drop partly on rising interest rates and wider economic turbulence.
“The headlines are always going to stop or propel people, and interest rates started creeping up a little bit,” Jim Kruse, a regional president with Kidder Mathews, said at the time. “I think there were a lot of these builders who said, ‘Hey, maybe I’m going to [wait and] start my project next quarter.’”
Of the 11,500 deliveries RentCafe tallied for this year, roughly 6,500 are in L.A. proper. The Greater L.A. estimate ranks as 10th most among metro markets in the country, just behind Atlanta and Washington, D.C. and just ahead of Orlando and Denver. RentCafe tallied that New York will have the most deliveries with 28,000, followed by Dallas with 24,000, and Miami with 19,000.
National development has picked up considerably since the early days of the pandemic, even if old obstacles are still in place.
“The construction industry is finally returning to pre-pandemic levels,” Doug Ressler, a manager of business intelligence at Yard Matrix, a commercial real estate data firm that partnered with RentCafe on the report, said in a release, “but is still being hampered by three familiar challenges: labor shortages, material costs and availability, and supply chain issues.”
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