Multifamily Boom Cools as Deliveries Dip from Historic Highs

The Big Picture

The US is emerging from the most prolific apartment construction cycle in modern history, per Globe St.

According to RealPage, while the sector remains active, the long-anticipated peak in supply has likely passed. Deliveries reached 576,700 units over the year ending Q1 2025—just under the 2024 record of 585,200.

Sign Of A Shift

This marks the second time in five years that US apartment supply has hit a historic peak. 

In Q2 2023, quarterly completions topped 100,000 units for the first time in at least three decades, driving annual deliveries past 400,000. That momentum carried into 2024, but Q1 2025 signals a modest pullback.

What’s Next For Supply

While construction remains robust, RealPage forecasts that roughly 431,200 units will be delivered by the end of 2025. Beyond that, annual supply is projected to normalize by 2026 and even fall below historic averages by 2027–2028—barring significant new starts.

Fewer New Projects Ahead

Leading indicators suggest the slowdown will continue. Multifamily permitting dropped nearly 16% year-over-year to a seasonally adjusted 404,000 units in February 2025, per US Census Bureau data. Starts also declined to an annualized 370,000 units—a 6.6% dip and well below the 2021–2022 highs of 600,000.

Why It Matters

After a surge fueled by demand, low interest rates, and housing shortages, the multifamily sector may now be entering a more restrained phase. Lower permitting and starts point to fewer future deliveries, which could eventually ease the pricing pressure created by excess supply in some metros.

Looking Ahead

Although delivery volumes are softening, RealPage cautions that fluctuations are likely due to delays and unexpected project starts. Still, the data points to a clear transition away from record-breaking construction volumes—and toward a more balanced apartment market.