The multifamily rental market appears to be moving past its recent supply glut. After several years of heavy apartment deliveries, elevated concessions, and pressure on rent growth, new construction is declining sharply while renter demand remains relatively resilient.
Quarterly multifamily starts fell to roughly 55,000 units in early 2026, the lowest level since 2011, while the number of units under construction has fallen significantly from its early-2023 peak.
At the same time, demand has strengthened. More than 250,000 apartment units were absorbed nationally during the first half of 2026, outpacing new deliveries by approximately 100,000 units. Quarterly completions are also down substantially from their late-2024 peak.
The result is a market that is gradually shifting away from oversupply and toward tighter conditions.
Markets Are Recovering at Different Speeds
Boise, Idaho appears to have already turned the corner. Occupancy has recovered to roughly 95%, rent growth has returned to positive territory, and the market has absorbed the vast majority of apartment deliveries since 2020.
Greenville, South Carolina is still working through recent supply, but its development pipeline is declining quickly. Strong population growth, relative affordability, and institutional interest continue to support both multifamily and Build-to-Rent demand.
Indianapolis, Indiana is experiencing a slower recovery. Occupancy remains softer, concessions are still common, and the market has more inventory left to absorb.
Richmond, Virginia stands out as one of the strongest markets examined. Occupancy remains near 95%, rent growth is healthy, and the market avoided the extreme delivery surge seen in many other metros.
What It Means for Rental Housing
The broader takeaway is that new rental supply is falling faster than renter demand.
High home prices and mortgage rates continue to keep many households in the rental market, while migration remains supportive in several growth metros. Meanwhile, the large wave of apartments delivered over the past few years is steadily being absorbed.
The recovery will not be uniform. Some markets are already experiencing stronger rent growth and lower concessions, while others still have excess inventory to work through.
But the direction is becoming clearer: the competitive pressure created by the recent construction boom is beginning to ease.
For developers and investors, that could mean improving occupancy, declining concessions, and stronger rent growth in markets where the existing supply wave has already been absorbed—particularly as the development pipeline becomes increasingly thin heading into 2027 and 2028.
Source: LinkedIn/Bryce-Shevak
