Multifamily Supply Forecast Revised Upward

Multifamily supply forecast climbs through 2027 as strong construction activity boosts near-term completions.

October 24, 2025

Yardi Matrix increased its multifamily supply forecast for 2025 by 6.8%, now projecting 584,875 units to be delivered by year-end.rn
The 2027 forecast jumped 12.8% to 406,757 units, driven by a solid pace of construction starts in 2025.
Despite recent declines, the US pipeline remains deep, with nearly 969,000 units under construction as of Q3 2025.rn
Year-to-date 2025 construction starts total 207,847 units, a 4.5% increase over the same period in 2024.rnrnrn

Key Takeaways

Short-Term Outlook: 2025–2027

Multifamily supply forecasts for the next two years are on the rise. Yardi Matrix raised its 2025 projection by 6.8% to 584,875 units, citing a still-strong under-construction pipeline. Similarly, 2026’s forecast rose 2.5% to 440,702 units.

The biggest upward revision came for 2027, where completions are now expected to reach 406,757 units, up from 360,558 units in Q3’s forecast. This revision reflects a higher volume of projects initiated in 2025, many of which will complete within 24 months—Yardi’s current average construction timeline.

Construction Starts Gaining Ground

As of Q3 2025, year-to-date construction starts are trending above 2024 levels. 207,847 units have begun construction, up 4.5% year-over-year. Matrix analysts now expect 400,000 starts in 2025, which will feed into completions by 2027.

The US Census Bureau’s August report supports the momentum, showing 403,000 units (SAAR) started in buildings with five or more units. That’s up 17.5% year-over-year on a non-adjusted basis.

Multifamily construction starts remain above 2019–2020 levels despite recent slowdown, supported by 2025 year-to-date activity.

What’s Driving the Forecast Upward

Construction Pipeline Stability: Although the pipeline is shrinking overall, it remains elevated. The under-construction pipeline peaked in early 2024 at 1.27M units and now totals 968,999 units, down 23.6% from the peak.
Pre-Leased vs. Non-Pre-Leased Units: The Q3 decline was entirely in pre-leased units (down 12.2% QoQ), while non-pre-leased units actually increased 3.4%, signaling ongoing activity in earlier stages of development.

Pre-leased multifamily units peaked in early 2024 before declining steadily into Q3 2025.

Completion Timelines: High build times, particularly for garden and mid-rise assets—now averaging 741 and 825 days, respectively—mean current starts will extend delivery into 2027.

Multifamily units under construction have declined since peaking in early 2024 but remain historically elevated.

Product Mix Holding Steady

The supply mix between market-rate, affordable, and single-family rentals is expected to remain stable. For 2025–2027:

Market-rate accounts for ~77%
Affordable housing: 14–16%
Single-family rentals (SFR): ~7%

This reflects only minor shifts compared to the 2021–2024 period, despite broader economic pressures and policy uncertainty.

Looking Ahead: Long-Term Outlook Unchanged

While the short-term forecast has shifted, Yardi Matrix held its long-term projections steady. Expectations remain:

410,000 units in 2028
Over 450,000 units by 2030

Analysts expect moderate economic growth, supportive fiscal policy under the One Big Beautiful Bill Act, and easing interest rates to support development in coming years. Markets that didn’t overbuild post-pandemic—particularly in the Midwest, Northeast, and Coastal regions—are positioned to see more stable growth.

Bottom Line

Despite signs of a cooling pipeline, Yardi Matrix sees signs of resilience in the multifamily sector. Stronger-than-anticipated construction starts and a still-deep project pipeline led to a significant upward revision for 2025–2027 completions. With favorable lending conditions and policy support on the horizon, developers may continue to break ground at a healthy pace heading into 2026.