A new market analysis compiled by Yardi® Matrix reports that demand, positive demographic drivers and job growth point to a healthy state of affairs for the U.S. multifamily market.
"We expect U.S. rent growth will remain moderate overall, led by growing Southern and Western metros in which supply growth has not gotten too far ahead of demand," says the report, which can be downloaded here.
Supply deliveries nationwide are beginning to plateau after topping 300,000 in 2016 and 2017. Development has been slowed by construction delays due to worker shortages and rising materials costs. In addition, the report says, "tax cuts will increase income, despite stagnant wage growth," and the Consumer Confidence Index reached an 18-year high in February. The economy has added more than 200,000 jobs per month in 2018.
The market analysis notes that rising interest rates and mildly disappointing first-quarter gross domestic product growth prompt concerns that "the economic cycle is running on fumes," while recent tariffs and rising oil prices add further uncertainty. However, it continues, "underlying U.S. economic fundamentals remain steady," giving rise to a 2.9% rent growth forecast for 2018, slightly above initial forecasts for the year.
Related Stories
Market Data | Sep 24, 2018
Hotel construction pipeline reaches record highs
There are 5,988 projects/1,133,017 rooms currently under construction worldwide.
Market Data | Sep 21, 2018
JLL fit out report portrays a hot but tenant-favorable office market
This year’s analysis draws from 2,800 projects.
Market Data | Sep 21, 2018
Mid-year forecast: No end in sight for growth cycle
The AIA Consensus Construction Forecast is projecting 4.7% growth in nonresidential construction spending in 2018.
Market Data | Sep 19, 2018
August architecture firm billings rebound as building investment spurt continues
Southern region, multifamily residential sector lead growth.
Market Data | Sep 18, 2018
Altus Group report reveals shifts in trade policy, technology, and financing are disrupting global real estate development industry
International trade uncertainty, widespread construction skills shortage creating perfect storm for escalating project costs; property development leaders split on potential impact of emerging technologies.
Market Data | Sep 17, 2018
ABC’s Construction Backlog Indicator hits a new high in second quarter of 2018
Backlog is up 12.2% from the first quarter and 14% compared to the same time last year.
Market Data | Sep 12, 2018
Construction material prices fall in August
Softwood lumber prices plummeted 9.6% in August yet are up 5% on a yearly basis (down from a 19.5% increase year-over-year in July).
Market Data | Sep 7, 2018
Safety risks in commercial construction industry exacerbated by workforce shortages
The report revealed 88% of contractors expect to feel at least a moderate impact from the workforce shortages in the next three years.
Market Data | Sep 5, 2018
Public nonresidential construction up in July
Private nonresidential spending fell 1% in July, while public nonresidential spending expanded 0.7%.