Even though the nation has an oversupply of apartments in many markets, investors are building more instead of pulling back, according to a new Yardi Matrix report.

“They are building with the strategy of delivering in two years, when supply growth is much lower, or taking a long-term approach and building core assets that will produce steady yields over time,” the report observed. Backing this effort are private domestic firms, foreign capital, and high net-worth families.

This is happening even as national occupancy rates slump to their lowest level since 2014, falling to 94.5% in December 2024 due to the high volume of new apartments being delivered in fast-growing markets. In Austin, Raleigh-Durham, Charlotte, Nashville, Phoenix and Denver advertised rent growth is negative in spite of strong demand.