Austin area apartment construction drops despite rapid growth

Given the challenges posed by the ongoing COVID-19 pandemic and all that came in its wake, it’s no surprise that apartment construction in the Austin metro area is expected to decline in 2021. In fact, the bigger surprise might be that it rose in 2020.

According to a new Rent Cafe report, 2020 saw the construction of about 13,300 new units in the Austin area. This year, the study projects 11,919—a 10 percent drop year-over-year, but still more units than were added in 2019 (8,858). That puts it seventh in the country and third in the state for number of units projected, despite the double-digit drop in 2020.

The report also breaks down projected new apartment growth metro-wide: Austin will get the lion’s share (7,756 expected units), followed by Round Rock (1,068), Pflugerville (740), and Georgetown (735). Leander is expected to get 550 new units, and Kyle—notably, the only suburb south of Austin in the top six for the metro—should get 363.

The Dallas-Fort Worth area, also to no one’s surprise, is predicted to blow past all the other metros in the report, both nationally and statewide; it’s expected to add 21,173 apartments in 2021 despite a 13 percent from 2020. Houston takes the fourth spot nationally, with a projected 15,760 new apartments—a 12 percent jump over 2020.

Nationally, the numbers for the most part took less dramatic swings, with a 2.5 decrease in new units predicted to delivered compared to 2020. Developers expect to build 334,000 new apartments nationwide, with New York getting 19,375 units (putting it in second place in the report’s rankings) and Phoenix, ranked third in the country, projected to get 15,846.

To calculate its apartment projections for the year 2021, Rent Cafe used a Yardi Matrix proprietary algorithm, which includes "confirmed and likely completions for 2021 based on the issuance of a certificate of occupancy," according to the report.