US multifamily market surges as Q2 demand hits 116,000 units, near record highs

Posted on September 26, 2025   |  

The US multifamily housing sector recorded one of its strongest three-month demand periods in 25 years during Q2, with over 116,000 units absorbed.

In the first half of the year, the market absorbed 216,000 units, nearly matching last year’s near-record pace.

The development pipeline is slowing, with fewer than 500,000 units under construction—the lowest since 2016.

Net absorption outpaced new supply for the second straight quarter. Q2 deliveries rose 18% from Q1 to 115,000 units but were still 22% lower year-over-year.

Under-construction properties now account for just 3.8% of inventory, less than half the 2023 peak.

Only 11 markets saw pipeline growth over the past year, with Dallas–Fort Worth (-22,000), New York, and Austin (-18,000 each) leading declines.

Other large pipeline drops were seen in Phoenix, Atlanta, Houston, and Washington, DC, each losing more than 10,000 units.

Amid economic uncertainty, owners are prioritizing occupancy over rent growth. Occupancy improved 20 basis points year-to-date, while rent growth slowed to 1.7% annually, the sharpest pullback since 2020.