DEMAND UNSTEADY AS NEW SUPPLY CONTINUES UNABATED
By Jordan Brooks , Senior Market Analyst ALN Apartment Data
The third quarter is in the rearview mirror and the end of 2024 is rounding into view . For the multifamily industry broadly , this year has seen apartment demand continue the improvement that began last year . However , new supply has remained well ahead of that demand . For many markets around the country , third quarter net absorption represented the highwater mark for recent demand . The story was a bit different for Greater San Antonio .
All numbers will refer to conventional properties of at least 50 units .
N O V E M B E R E D I T I O N
JORDAN BROOKS
New Supply and Net Absorption
New supply surged once again in the third quarter with more than 4,800 new units delivered . That level of new supply exceeded the same portion of 2022 and 2023 combined and brought total 2024 deliveries through September to more than 11,000 units .
The new supply in the period was especially concentrated in the Greater New Braunfels region . The more than 1,400 new units introduced there were more than double the total delivered in the second most active submarket . Just less than 600 new units in the La Cantera – Dominion – The Rim area made it the only other submarket with at least 500 new units in the quarter .
With new supply and net absorption so imbalanced in the period , average occupancy for Greater San Antonio declined by 190 basis points to end September at just over 83 % - its lowest point in two decades .
The huge amount of new supply was not unique to San Antonio . Where the market did break from many others in the region was the backward step in apartment demand . Net absorption of barely more than 600 units was almost 40 % lower than last year ’ s total for the same portion of the calendar . For properties that entered the year already stabilized , the quarter was even worse . That subset of the market suffered a net loss of more than 1,200 leased units . That result for stabilized properties was the worst for any third quarter in the last twenty years .
With new supply and net absorption so imbalanced in the period , average occupancy for Greater San Antonio declined by 190 basis points to end September at just over 83 % - its lowest point in two decades . For properties that entered the year stabilized , average occupancy finished the period at just under 90 %. Only the 2008 – 2009 period was lower , and only by around 100 basis points .
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