According to a new report from RealPage, the U.S. apartment market is set to receive more new units in 2020 than it has in any of the last 30 years.
The multifamily market had a rollercoaster of a year in 2019.
Multifamily vacancies hit record lows, with occupancy levels reaching as high as 95.8%, according to RealPage. This is 40 basis points above figures in 2018.
The real estate tech company says it expects about 371,000 new apartment units to hit the market this year, which is a 50% increase compared to last year’s expected new builds.
With all of the new supply expected to hit the market this year, this means about 17% more apartment units will be added to the market.
“Developers have struggled to produce enough new housing to meet demand in recent years,” said Greg Willett, chief economist at RealPage. “However, the volume of apartments on the way in 2020 certainly could test the market’s ability to absorb a big block of additional units in a short time frame.”
The Mortgage Bankers Association predicted late in 2019 that multifamily originations are set to hit yet another all-time high in 2020.
Rent prices also grew by a total of 2.8% in 2019. Rent gains throughout the year hovered around 3%.