D-FW led the country in apartment building permits in October
Slowdown? What slowdown?
Apartment builders and analysts have been predicting a slowdown in new rental projects. Early this year it looked like starts were beginning to wane. But new numbers show that Dallas-Fort Worth apartment building has increased more than 14 percent this year.
And North Texas led the country in apartment permits in October with 3,182 more rental units on the way, according to data from Richardson-based RealPage.
RealPage chief economist Greg Willett said there are mixed signals in the local apartment building sector.
“The October figure of almost 3,200 units approved is the biggest block of units authorized anywhere across the country by a big margin,” Willett said. “And the annual permit pace of roughly 22,000 units has accelerated again on a year-over-year basis, after having slowed from approximately 25,000 units a couple years ago.”
During the 12 months ending with October, D-FW apartment builders have filed permits to start 22,061 new units. That’s second only to New York City’s 31,060 multifamily building permits.
Willett said there are still indications that the North Texas apartment building cycle has peaked.
“The number of potential starts we’re tracking as they move from concept to approval is off sharply from the volume seen a couple years ago,” he said. “Plus, most of the major developers we’re talking with say that their site pipelines are running low, with meaningfully fewer starts planned just ahead.”
Willett said the permit numbers nevertheless indicate thousands more D-FW apartments are about to come out of the ground.
At the end of the third quarter almost 48,000 apartments were being built in North Texas — down from more than 50,000 units in the development pipeline at the start of 2017.
“There’s the possibility that we’re getting the last burst of starts for this economic cycle, with so few properties identifiable in the planning stages behind what’s getting going right now,” Willett said. “But we probably shouldn’t count on that.
“Viewed relative to the barriers to entry in lots of other markets, new developments in Dallas can go from not on the radar at all to under construction really quickly.”