By Angela Gonzales | Phoenix Business Journal
Apartment construction in the Valley has dropped off sharply this year, with the region experiencing one of the biggest declines in projected apartment unit construction among the 20 largest U.S. metros.
With 5,665 new apartment units projected to be completed by the end of the year, down 37% from 2019, metro Phoenix ranks 15th nationally, according to a report from RentCafe. Last year, the study documented 8,940 apartment units completed in the Valley.
During the first half of this year, 906 units were completed within the city of Phoenix, which didn’t make RentCafe’s Top 20 by apartment completions. In fact, 13 of the 20 metros are seeing fewer apartments in 2020, according to the study.
Nationally, apartment construction is in its second consecutive year of decline after peaking in 2018, with an estimated 283,000 new units expected to hit the market, 12% less than in 2019, according to RentCafe.
Jessica Morin, director of market analytics for CoStar Group in Phoenix, said the coronavirus pandemic has softened demand for apartments while construction has been steadily progressing.
Her research shows that metro Phoenix has added 16,870 apartment units over the past eight quarters, which outpaced demand of 14,370 units.
Vacancies have held pretty tight, she said.
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