U.S. Opening More Than 500K Apartments Annually for Second Time on Record

Apartment construction volume across the nation is still booming after hitting a record-breaking number last year, with Southern U.S. metros leading the charge. 

More than 506,000 units are estimated to open nationwide by the end of this year, according to a new report from RentCafe. The number is just below the 518,000 new units in 2024 — the third consecutive year of record-setting apartment construction volume. Yet, if all expected projects come to fruition, 2025 will be just the second year on record in which U.S. apartment completions surpass 500,000 units. 

The New York City metropolitan area topped RentCafe’s list of U.S. metros with the highest projected unit volume, with 30,023 units expected by the end of this year. While that volume is down 8.4 percent compared to last year, 2025 is the fourth consecutive year that the New York metro has topped the list. Nearly half of those units, about 14,500, are set to open in three New York City boroughs: Brooklyn with 7,189 units, Manhattan with 4,662 units and Queens with 2,630 units. 

Southern metropolitan areas grabbed the following seven spots within the top 10: Dallas, Austin, Phoenix, Atlanta, Charlotte, Miami and Houston, respectively. Indeed, active developments in Sun Belt cities will account for more than half of all new apartment completions by the end of this year, driven largely by job and economic growth in the region over the past decade, per RentCafe. 

“Southern metros typically offer streamlined approval processes and fewer regulatory hurdles, making it easier to bring multifamily projects to market,” Doug Ressler, senior analyst and manager of business intelligence at Yardi Matrix, said in the report (Yardi owns RentCafe). “At the same time, elevated home prices and a shortage of attainable for-sale housing are pushing more residents toward rentals. For many households, single-family ownership is simply out of reach — fueling demand for rental housing.”

The Miami metro in particular, which came in seventh place, will see 15,666 new units by the end of this year. Yet that figure is still a decline of 28.2 percent compared to last year, despite South Florida’s status as one of the hottest rental markets in the country.  

The Washington, D.C., metro came in ninth place with 13,903 units, though the figure is also an overall decline compared to the 15,079 seen in 2024. Ironically, the DMV leads the nation in residential unit conversions per capita with more than 6,500 units in the pipeline, according to a separate report from RentCafe earlier this year. 

Despite its ongoing affordability crisis, the Los Angeles metro came in at 11th place on RentCafe’s apartment pipeline list, with 12,558 units expected by the end of 2025. Still, it ranked third among all Western U.S. metros, behind Phoenix and Denver, though saw a significant boost compared to the 8,924 units that opened in 2024.

The City of Riverside, in California’s industrial-minded Inland Empire region, is the most notable surprise on RentCafe’s list this year. The city of about 324,000 people ranked 19th on RentCafe’s list with 6,096 new units expected in 2025 — an increase of 154.1 percent compared to last year, placing it third on RentCafe’s tally of city metros with the highest year-over-year apartment growth. That growth is largely driven by former L.A. County and Orange County residents enticed by the Inland Empire’s relative affordability and proximity. 

Nick Trombola can be reached at ntrombola@commercialobserver.com.