RICHARDSON, TX—Even as the construction pipeline has emptied out to a degree, new apartment supply reached a 30-year high in 2017. RealPage data show 395,777 completed units in the 150 largest US metro areas, a 46% increase over 2016 completions. However, on the whole demand continues to keep pace with the new supply.
Notwithstanding a fourth-quarter lull that's characteristic of the season—albeit one that was accompanied by a rent decline at the deep end of the normal range—apartment demand remained strong for '17 and kept occupancy levels steady at 95%. However, RealPage notes that operators have reined in their pricing strategies in an effort to fill all of those new units.
For the nation overall, rent growth in '17 averaged 2.6% year over year, although some markets fared considerably better than that. The 2.6% average is down from the range of 4% to 5% annual increases that were common from 2014 through '16.
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Paul Bubny
Paul Bubny is managing editor of Real Estate Forum and GlobeSt.com. He has been reporting on business since 1988 and on commercial real estate since 2007. He is based at ALM Real Estate Media Group's offices in New York City.
