APARTMENT DEMAND HAS IMPROVED , BUT NOT ENOUGH
By Jordan Brooks , Senior Market Analyst ALN Apartment Data
The Greater San Antonio multifamily new construction pipeline has continued its deluge of new units this year . New supply through July was at its highest level for that portion of the calendar since 2008 . In the face of these new units , overall average occupancy declined by 250 basis points to its lowest July value in more than twenty years . The occupancy collapse has come as a result of apartment demand consistently falling short of supply since the close of 2021 . From the start of 2022 through July of 2024 , nearly 19,000 new units have been delivered and net absorption has totaled a net loss of nearly 2,000 leased units .
All numbers will refer to conventional properties of at least 50 units .
S E P T E M B E R E D I T I O N
JORDAN BROOKS
Net Absorption at the Market Level
Apartment demand has been consistently poor for more than two years at a time when new supply has been higher than at any time in more than a decade . A silver lining in that misalignment is that there has been some improvement amidst the struggles . In 2019 , and even in 2021 , monthly net absorption at the market level was negative for a couple of months during the winter season . This dynamic is not unusual and is typically not a cause for concern .
The trouble began in earnest during 2022 . Eight months featured a net loss of leased units that year , including every month from August through December . In that five-month period alone , approximately 2,700 net leased units were lost . In 2023 , five months suffered a net loss of leased units , but none consecutively . The total decline in those months was also a bit smaller with around 2,000 net leased units lost . In 2024 , although the trend in monthly net absorption has not been encouraging , only April saw a net loss of leased units .
Aside from fewer months with negative net absorption , 2024 has also provided some of the most robust months in quite some time on the positive side . Net absorption in June topped 700 units for the first time since October of 2021 . The month before , more than 600 net units were absorbed – the third highest monthly total since the end of 2021 . Even so , these two months are likely to represent the peak period of 2024 . This peak would represent improvement over 2022 and 2023 but would also be much lower than in any other recent year
Net absorption in June topped 700 units for the first time since October of 2021 .
17 SEPTEMBER 2024 | WWW . SAAAONLINE . ORG