New Apartment Construction Stays Strong in 2025, Even as Last Year’s Record Pace Cools

Apartment construction in the U.S. is proving resilient in 2025. An estimated 506,353 new rental units are projected to open nationwide by year’s end. While that figure falls short of last year’s record-breaking wave, it still surpasses every other annual total since 2015, underscoring how developers are continuing to respond to strong demand for rentals.

Southern metros typically offer streamlined approval processes and fewer regulatory hurdles, making it easier to bring multifamily projects to market,” said Doug Ressler, Senior Analyst and Manager of Business Intelligence at Yardi Matrix. He added that high home prices and a lack of attainable for-sale housing mean that “for many households, single-family ownership is simply out of reach—fueling demand for rental housing.”

South Dominates Construction Activity

The South remains the clear leader in new apartment construction, with more than half of all projected 2025 deliveries located in the region. Texas and Florida are especially strong contributors, reflecting years of rapid population growth. Cities such as Dallas, Austin, and Houston are seeing significant levels of new development, while Florida metros like Miami and Orlando also continue to expand rental housing.

Migration patterns are a big driver. Sunbelt states have attracted new residents for more than a decade, thanks to job growth, affordability relative to coastal markets, and business-friendly climates. That steady inflow of people has fueled the need for more housing, and developers have responded accordingly.

New York Metro Holds Top Spot

Despite the South’s surge, the New York metro is again the nation’s top market for apartment deliveries in 2025, with more than 30,000 units expected. Brooklyn leads the boroughs, followed by Manhattan and Queens. The scale of construction reflects both strong renter demand and a development pipeline years in the making.

Dallas follows closely, while Austin ranks third nationally. Austin’s rapid growth is linked to its booming tech sector and influx of new residents, which has made it one of the hottest rental markets in the country.

Smaller Markets Stand Out

In addition to large metros, several smaller cities are recording big jumps in apartment completions. Naples, Florida, nearly quadrupled its deliveries from the previous year, and Birmingham, Alabama, almost tripled. These surges highlight how housing demand is spreading beyond the biggest markets into midsized cities offering affordability and quality of life.

Construction Slows in Some Regions

Not all metros are expanding, however. Chicago has seen the steepest decline, with projected completions down more than half compared to last year. Developers there face high costs and slower lease-ups. Other metros, including San Francisco and Portland, are also experiencing cutbacks as financing tightens and demand patterns shift.

Even so, the broader trend is clear: new apartment construction remains elevated, continuing to reshape housing markets nationwide. While the wave of historic building may have crested, the supply of new rentals is still well above long-term averages, reflecting just how strong demand for apartments has become.

Click here for more on RentCafe’s analysis of the nation’s apartment construction market.

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Picture of Andy Beth Miller

Andy Beth Miller

Andy Beth Miller is a seasoned journalist, editor, and freelance writer with over 20 years of experience in magazine, newspaper, and editorial writing. She has contributed to a variety of journalistic publications, including DSNEWS, MReport, and FiveStar Institute, as well as luxury magazines such as Pasadena Magazine, Hawaii Home and Remodeling, HI Luxury, Waikiki Magazine, Big Island Traveler, Zicasso, Midweek Magazine, and more. Andy Beth has also written for Dining Out Hawaii and other regional outlets. Throughout her career, she has honed her skills in storytelling, consistently delivering compelling and insightful content across diverse topics. Her work has taken her around the globe, allowing her to cover an array of subjects spanning from procurement and pharmaceuticals to travel and lifestyle. She brings a wealth of experience and a passion for storytelling to every project she undertakes, and considers it a great joy to be able to see the world and write en route.
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