Since 2008, the year during which investment bank Lehman Brothers faltered and home prices collapsed, there has been a steady increase in the number of people ages 18 to 34 renting instead of buying. This has unleashed a flurry of apartment construction in many markets, including in both Baltimore and Washington.
According to analysts at Trulia, a real estate marketing website, roughly 875,000 more households are now made up of young adult renters than would have been the case if pre-2008 patterns of home purchasing had held steady. As pointed out by writer Dionne Searcey, this has led to a rebound in multifamily construction. While construction of single-family homes is only halfway back to pre-recession levels, construction of multifamily units, which includes both apartments and condominiums, is at its highest level in 25 years.
Apartment construction has come to exceed its pre-recession peaks in a number of major markets, including in Austin and San Jose according to a recent report from the Joint Center for Housing Studies at Harvard University. According to Moody’s Analytics, the nation needs even more rental units, particularly affordable ones. Vacancy rates for rentals are as low as they have been in more than 2 decades and rents in most market are climbing.
