Multifamily completions have been both a blessing and a challenge during the last couple of years. Record deliveries were great to have, but outpaced demand, resulting in some metros experiencing higher vacancy rates and lower rent growth.
Last month, Yardi Matrix forecasted a drop in construction but an increase in completions for 2025 and 2026, numbers revised respectively by 3.3% and 11.5%.
RealPage just examined the dual dynamic of completions and the construction pipeline. It noted that the “surging wave of multifamily completions is cresting (although individual market peaks vary).” Continued momentum in completions could fit into a crest.
Recommended For You
What was more interesting in the RealPage take was that multifamily permitting and starts appear to have reached bottom in the construction cycle. It based this on permit and housing survey data from the U.S. Census Bureau and the Department of Housing and Urban Development.
In March, the multifamily permitting seasonally adjusted annual rate (SAAR) was 445,000 units, a 10.1% increase from February. Annualized multifamily starts were roughly flat month-over-month at 371,000, up 47.8% from the “last March’s unusually low figure," according to RealPage.
The software firm also looked at the moving 12-month non-seasonally adjusted sum of permits and starts. It’s a less volatile figure than the SAAR but more predictive. The sum of monthly permits and starts showed a movement toward growth, and if this continues, it would suggest that the market has found bottom. It’s the first time in about two years that neither measure declined.
Additionally, the report said that the SAAR for multifamily units under construction was down by 20.7% from March of last year. However, it was only off by 1.2% from February 2020. Again, a suggestion that construction is finding a bottom, which should preface a turnaround.
March's seasonally adjusted annual completions were 503,000 units, down 8.3% from February and 4.4% from March 2024.
The annual rate of multifamily permitting differed between regions. In the Northeast, it was down 52.9% to 36,000 units. In the West, it fell 16.1% to 92,000. However, permitting was up 28% to 74,000 in the Midwest. In the South, it was up 18.8% to 242,000 units.
Annualized multifamily starts were up more than double in the Northeast — 159.6% to 71,000 units. The Midwest saw a jump to 101,000 units, or 484.1%. The South experienced a 26.5% increase to 146,000, and the West saw a 41.1% decrease to 54,000.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
