Apartment Starts Plunge in March

Both multifamily and single-family starts dropped in March from their February levels, according to the seasonally adjusted annual rates calculated in the U.S. Census Bureau’s latest data release. Multifamily dived 20.8% and single family 12.4%.

However, on an annual basis their paths diverged. The 290,000 multifamily units started in March were 43.7% fewer year-over-year. Meanwhile, the 1,022 million single-family homes started in March – though fewer than the previous month – represented a 21.2% increase over March 2023, RealPage reported.

“March’s significant decreases in annual multifamily and single-family starts brought the SAAR of total residential starts down 14.7% from last month to 1.321 million units – down 4.3% from last year,” the report noted. Only the West saw an increase in March multifamily starts compared to February.

Completions also differed. In multifamily, March 2024 revealed a 4.6% annual increase in completions to 502,000 finished units, though 20% below February 2024. However, the 947,000 single-family units completed in March were 8.5% below the prior year and 10.5% below February, with 2.7% fewer units under construction.

In addition, permitting was impacted. “Together with the small two-to-four-unit figures, total residential permitting fell 4.3% from last month but was up 1.5% for the year to 1.458 million units,” the report said.

On an annual basis, single-family permits were up 17.4% but multifamily slumped 22.1% with the single exception of the small Northeast Census region where multifamily permits rose 13.8%. However, compared to February, multifamily permits in March were up in the West and South and down in the Northeast and Midwest.

Multifamily permits issued in March dropped dramatically year-over-year in leading metros with Houston seeing a plunge of 50.5%, Atlanta 42.5% and the Washington, DC metro 34.3%. Many markets outside of the top 10 also saw declines. “The annual total of multifamily permits issued in the top 10 metros – 149,705 units – was about 28% less than the 207,944 issued in the previous 12 months and down about 2% from last month,” the report stated.

By city, the highest number of multifamily units permitted during the year was in Austin, followed by Los Angeles, Phoenix, Nashville, New York, Charlotte, Atlanta, Houston, and San Diego.

Some metros beat the overall negative trend. “Major markets with significant year-over-year increases in annual multifamily permitting in the year-ending March were Nashville (+4,096 units), Greensboro/Winston-Salem (+3,630 units), San Diego (+3,317 units), Pittsburgh (+1,512 units), Riverside (+1,322 units) and Knoxville, TN (+1,116 units).”