Long-Term Outlook for Rental Apartments Remains Positive
August 24, 2017 | Bendix Anderson | National Real Estate Investor
Many of the markets where developers have been doubling down on building new apartment units are likely to have enough renters to fill those apartments over the next decade or so, according to the latest research commissioned by the National Multifamily Housing Council (NMHC) and the National Apartment Association (NAA).
“The analysis suggests that 15 or so metros will lead the way on activity, and they are basically the same 15 or so spots that have accounted for about half of both demand and supply in the current economic cycle to date,” says Greg Willett, chief economist with real estate data firm RealPage Inc., which has reached similar conclusions to NHMC/NAA.
As the percentage of vacant apartments creeps upwards towards 5 percent on average across the country, many industry experts worry about overbuilding and potentially falling rents. But the overall demand for apartments is likely to solve many problems, including propping up occupancy rates even in some of the busiest markets for new construction.
