Developers will likely delay starting new apartment projects until they see strong employment growth.
New development is expected to exceed anticipated demand for the first time in years. Wage growth does not seem to be keeping pace with rental price increases and certainly, rent control measures could significantly impact investment – especially in the value-add segment of the market.
Underlying demand for apartments remains strong as a robust labor market and positive demographic trends support healthy unit absorption, despite mounting supply pressure. Moving forward, modest performance gains are expected on the national level as the market continues to digest the aggressive development pipeline.