The number of new apartments is at a 50-year high, but states expect a slowdown

https://oregoncapitalchronicle.com/2025/05/02/the-number-of-new-apartments-is-at-a-50-year-high-but-states-expect-a-slowdown/

by rwc9 • 1 year ago

38 79 1 year ago

oregoncapitalchronicle.com

angra_mainyu6• 1 year ago

A U.S. Census Bureau survey found almost 592,000 new apartments were finished last year, the most since the 1970s, when baby boomers sparked a construction surge as they moved out of their childhood homes. There were 693,000 new apartments built in 1974, when the country had about half as many households.

I feel the numbers would be best contextualized as ratios of demand (e.g: prospective homeowners).

As a rough first approximation, Google gives me the US population in 1974 as: ~212.53M, with the 2025 population at: ~347M.

So it'd be more significant with: 1.63 * 693k = ~1.131M new apartments.

Of course, this is a rough approximation which doesn't take into account a host of other factors, but you can already guess things are not as optimistic as the headline would make it seem. That said, I'd guess those factors would further increase the "households per capita", with phenomena like the shrinking of nuclear families relative to the 1970s.

For example, googling average household size gives me: 1974=3.44 and in 2025=2.51. This yields roughly: 61.78M households in 1974 vs 138.24M households in 2025. Which means we'd ideally want to see something closer to: 2.26 * 693k = 1.57M new apartments.

deeThrow94• 1 year ago

Also, it doesn't make sense to price homes in absolute terms. Surely relative to wage would be a better indication of the health of the market. Unless we can bring the wealthy to heel of course.

angra_mainyu6• 1 year ago

100% agreed! Housing prices stated in reference to purchasing power would make a bit more sense.

kasey_junk• 1 year ago

Didn’t you do a bunch of math to get to what the sentence you quoted said?

jeffbee5• 1 year ago

when baby boomers sparked a construction surge as they moved out of their childhood homes.

Man, boomers had smarter parents than boomers' children had. When the much more numerous millennials wanted houses, boomers told them to go jump in a lake.

tharmas3• 1 year ago

Boomers = The Selfish Generation

Poor stewards.

Aloisius• 1 year ago

This is just apartment (5+ units in a building) completions though, not all housing units completions.

The mix of housing unit type has a large effect. In terms of total unit completions, we're still behind where we were in 2006, the mid-80s, the late 70s and nowhere near early 70s.

amir734jj• 1 year ago

In the Midwest city where I live, the price for a new apartment is almost or even more than a house in the suburbs. All these apartments usually end up empty or get rented out. Such a waste of money.

angra_mainyu6• 1 year ago

What's wrong with renting? I refuse to buy until I hit at least my 40s and/or start a family and decide I will stay put in a place.

I've seen people go through the incredible pain of having to either turn down job offers because they can't sell in a month's time and relocate or be drowned in the myriad issues involved in selling/renting out.

Personally I can't justify buying a house to myself until I either hit my 40s or have picked a corner of the world I want to settle down with a family and probably die and get buried there.

EDIT: why downvote? I'm not opposing people buying houses, I'm opposing demonizing renting out when for lots of people it's the preferred option.

petepete• 1 year ago

If you're able to save while renting, fair.

Lots of people can't and get stuck in the cycle. In the UK at least, they're often just paying other peoples' mortgages.

spicyusername2• 1 year ago

    why downvote

    for lots of people it's the preferred option.

I am going to guess the down votes represent dissent from the idea that renting is generally the preferred option.

Renting is definitely more flexible, but it is also basically just a regressive tax that transfers wealth from those at the lower end of the income distribution to those closer to the top.

If housing was affordable, I think you'd find that most would opt to own and there would be less ability for those with means to prey on those without.

rufus_foreman• 1 year ago

> What's wrong with renting?

The problem with renting, in areas like the parent poster is talking about, is that in those areas almost anyone who can hold down a full time job, even a low wage job, can afford to buy a house. When you rent an apartment, you end up living around the people who can't hold down a full time job. Which is not always ideal.

HDThoreaun2• 1 year ago

In my Midwest city the reason for this is because a huge amount of the cost associated with building has nothing to do with construction. You have to bribe the local politician to get zoning approval and then hold community meetings run by expensive consultants you need to employ. With such huge upfront fixed costs it only makes sense to build luxury. If we reduce the friction to building, more housing would be built and affordable styles would be much easier to pencil out.

skipkey• 1 year ago

But see, to the politicians this is a feature, not a bug. It’s the same reason that it’s incredibly expensive in terms of permitting and such to start a brick and mortar business in many cities. They would rather leave the locations unoccupied and available for something that will bring in high tax revenue than tie them up with low revenue occupants.

greenie_beans• 1 year ago

yeah the cost of building has nothing to do with the construction cost, like the materials and labor

andrewchilds• 1 year ago

With such huge upfront fixed costs it only makes sense to build luxury.

You really believe that if there were less upfront fixed costs, that developers wouldn’t still default to building “luxury” as long as nothing was stopping them? The profit margin incentives are all still the same, regardless of the level of community/political opposition.

energy1235• 1 year ago

[flagged]

WalterGR• 1 year ago

I wonder if there are structural reasons why California's housing construction is lower than Texas, rather than intentional punching-down.

prasadjoglekar• 1 year ago

Not sure if you intended the pun, but the biggest structural reason is not engineering but procedural. The permitting, environmental processes in CA are often onerous making new construction much more expensive. That means the rents must be higher to break even, which in turn means new apartments go up where the incomes support those higher rents. Paradoxicall places where incomes are high also tend to have the most onerous permitting.

dtech• 1 year ago

Texas is much more liberal in what you can do, which means that the market functions better. CA has much more - well meant - requirements and regulations.

lazide• 1 year ago

California has significantly stronger NIMBY forces than Texas.

Desirable real estate is also much more constrained by geography than Texas.

dragonwriter• 1 year ago

I wonder if there are structural reasons why California's housing construction is lower than Texas

Prop. 13 prevents localities from meaningfully taxing property values, capping nominal rates at lower than the national average effective rates and reducing effective rates even further by limiting assessment increases to much less than the usual value increase in between transfers.

This forces localities to rely on sales and income taxes (both local and redirected shares of state taxes, both directly and as allocations of state funding for particular functions), which are much more volatiles, and do not reward attracting moderate income residents who pay low income tax rates and for whom housing and sales tax exempt basics are a much larger share of their spending.

Retric• 1 year ago

Three of the major Texas cities (Dallas, Austin, San Antonio) have far more room for growth based on geography they simply aren’t next to the ocean etc. This has significant impact on how infrastructure can be added and the availability of land for housing. California also has significantly increased construction costs dealing with earthquakes, and water scarcity issues.

But that’s a long way from explaining everything going on, government regulations have a real impact.

Braxton19806• 1 year ago

Specifically who is virtue signalling and then not building homes?

As far as I know the state government of California doesn't build homes. Smaller local governments can change zoning laws and the like but don't due to NIMBY stuff talked about here.

Home builders aren't virtue signalling.

Finally, if new apartments are constructed how would that be better solution to those already renting existing older apartments who are under rental stress?

energy1235• 1 year ago

The degrowth leftists like Dean Preston or the state and federal Dems who either turn a blind eye to them or go so far as to endorse them (like Nancy Pelosi) despite their anti-housing track record.

vemom• 1 year ago

Does the state have any power. In Australia I think the state has power to generally zone things e.g. near a train station is high density and it is out of councils hands much to their chagrin.

itake3• 1 year ago

Rich people need places to live but if there isn’t new housing for them to move into, they’ll live in the next only option: existing older units that could be rented out by lower income people.

fundaThree• 1 year ago

TX builds over 2x more per capita than CA.

Ok, but this comes at the severe detriment of having to deal with the Texas government. Why not just move out of the country at that point?

energy1235• 1 year ago

Or the Democratic Party can get their house in order before the next federal election? They run a decent pro-growth platform at the federal level, but CA is a living counterexample that will be a sink on their credibility until it's fixed. It should be an existential issue for them given they'll lose a bunch of congressional seats in 2030 if they fail to start building.

bluesnews2• 1 year ago

Most people don't have the ability to move out of the country

eGP9jDq_nw• 1 year ago

Consider adding the country of relevance to the title for inclusivity purposes

jmyeet3• 1 year ago

I used to be very YIMBY. Build, build, build. But what I've come to understand is that this just isn't going to help. Do it anyway, but it's just not going to correct the problem of unaffordable housing.

The entire real estate industry and our government is designed to make housing prices go up over time. Voters are behind it because it gives the impression of increasing wealth but it's an illusion for most people. If the median price is $200k and you buy a house for $200k and the median price and your house goes up to $600k, you still only have one housing unit's worth of wealth and you need to live somewhere.

All increasing real estate prices does is enrich a tiny minority by stealing from the next generation. And the negative externalities are massive. Housing makes everything more expensive.

If you look at NYC, you can see that a lot of apartments get built but almost all of them are for the ultra-wealthy to park money. You aren't increasing the available housing.

In the 1990s the average house price in London was 70k pounds. Now it's over 700k. Are wages 10x? No, no they are not. The whole thing is a giant Ponzi scheme to keep people in debt so they're compliant little workers.

AlphaSite• 1 year ago

I mean in the Bay Area where SFH have massively ballooned in price condos have remained steady for a long time. It works. Maybe not everyone gets the SFH but that’s fine and not the point. Everyone can own a home.

gregwebs• 1 year ago

Luxury apartments prevent gentrification.

Unoccupied housing or otherwise housing purely for investment is certainly a problem. If they aren’t renting at least with AirBnB they would actually be better served by holding gold in many cases.

jeffbee5• 1 year ago

It does help and is helping. Here's an article published this week in Berkeley about how a modest building boom has stabilized and lowered rents in existing buildings, after rents doubled in the 2010s.

https://www.berkeleyside.org/2025/05/01/berkeley-housing-ren...

Note: I developed the data used in the article.

jmyeet3• 1 year ago

If you look at the trend for all Bay Area cities over a similar period [1], you'll see Berkeley is pretty much in line with the overall trend.

Now you can argue that's because of greatly increased development, but I don't think that applies to SF (or SJ) and it doesn't match the Berkeley timeline anyway.

[1] https://www.sfchronicle.com/projects/sf-bay-area-rent-prices...

davidw5• 1 year ago

what I've come to understand is that this just isn't going to help.

This is false though.

Austin, Texas built a lot of apartments and then rents fell 22%. That's a big win for a lot of people seeing lower prices!

NYC is not a place that builds very much in proportion to the population.

I think that the claim that "supply and demand do not apply to housing" is an extraordinary one, and extraordinary claims require extraordinary evidence.

jeffbee5• 1 year ago

Recently some socialist lackwit on Twitter was railing that YIMBYs only lowered prices from $600k to $500k. This person apparently did not understand that the difference - $20k up front and $700/mo for 30 years - is the margin between affordable and not affordable for tens of millions of ordinary people.

jmyeet3• 1 year ago

Austin, Texas built a lot of apartments and then rents fell 22%.

This is false. Just look at the chart [1]. All that's happened is some of the pandemic price gouging, something landlords were being sued over [2].

We simply cannot capitalism our way out of this problem.

i think that the claim that "supply and demand do not apply to housing"

Where did I say that?

Speaking more generally, the idea of a "free market" is a myth, particularly for housing. It's one of the most manipulated and politicized markets there is.

But supply and demand do apply and it has been a political goal for decades to ensure that supply will be constrained.

[1] https://www.kut.org/austin/2024-06-13/austin-texas-rent-pric...

[2] https://www.austinmonitor.com/stories/2025/01/u-s-accuses-si...

tharmas3• 1 year ago

Maybe Austin is an outlier. They have high property taxes. Or people left because of those taxes Most cities that built a lot of housing saw it bought up by investors.

Hilift• 1 year ago

Check out the story on Block 216 in Portland. A well known local developer sunk a lot of his own money into the development of an upscale hotel/residences. The result? The new, finished development is valued at $415 million, however the loan debt is $510 million. And of course it isn't generating any tax revenue for the city, which has about $100 million budget deficit, recently announced cuts in services.

San Francisco collected $522 million in real estate transfer property tax in 2022. This year will be less than half that.

The inflationary rebound after the pandemic and lower than normal interest rates created an artificial market that otherwise may not have existed.

https://www.oregonlive.com/business/2025/04/tower-anchored-b...

https://www.oregonlive.com/business/2025/04/at-troubled-port...

https://www.wweek.com/news/city/2025/05/02/portland-city-lea...

ozgrakkurt• 1 year ago

Why not make it impossible for any corporation to own any real estate that is used for housing people?

Is this such an unimaginable evil thing to do?

It is really astounding that people put up with this and not vote on it or demand it

7e• 1 year ago

New apartments = new babies = expensive apartments 20 years later, but with more traffic, pollution, and cost to the earth.

fra• 1 year ago

[citation needed]

scoofy• 1 year ago

Not if we build trains and walkable neighborhoods.

The number of new apartments is at a 50-year high, but states expect a slowdown

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