U.S. Apartment Construction Boom

planned/under construction

More than half a million new apartment units are expected to be completed in the U.S. in 2025, which is a 21% decline from the previous year's record. The construction pipeline is slowing due to higher building costs, higher interest rates, and surplus supply in some markets, making developers cautious about starting new projects. Over half of the new units on track to open in 2025 are located in the South, which benefits from a business-friendly environment, relative affordability, and less restrictive zoning laws compared to coastal areas. The apartments being built are mostly luxury units, not affordable options, and with fewer new apartments coming, rents could climb faster again.