The multifamily housing market in 2025 is expected to experience significant shifts.
Shifts in the market are driven by a combination of a significant number of unit completions as well as market recalibrations. Insights from Lee Everett, EVP and Head of Research Strategy with Cortland, as highlighted in an Urban Land article, and Christine Serlin, Editor for Multifamily Executive, provide a comprehensive perspective on the opportunities and challenges ahead.
According to Christine Serlin, 2025 will see an 8.1% increase in new multifamily unit deliveries, amounting to approximately 508,089 units. This surge is attributed to delayed projects finally coming to fruition, a trend expected to extend into 2026 with an additional 371,509 units—a 6% increase from prior forecasts. However, Serlin notes that a decline is anticipated in subsequent years, with new deliveries potentially bottoming out at 327,000 units by 2027 before rebounding in 2028 and beyond.
Adding additional context to this dynamic, Lee Everett described 2025 as “an inflection point for the multifamily market.” He emphasizes that while the upcoming wave of completions offers growth opportunities, stakeholders need to remain vigilant about potential oversaturation and shifts in demand. Everett states, “Developers and investors who adapt strategically to these changes will be best positioned to capitalize on the market’s eventual recovery.”
Mid-2024 data underscores the market’s strength, with over 1.2 million units in the development pipeline. Of these, Serlin reports that 568,000 units are in the lease-up phase, reflecting a 5.5% year-over-year increase, while another 596,000 are under construction and expected to come online by late 2025 or early 2026. Everett highlights the importance of aligning this influx with market demand, noting that “overbuilding in some regions remains a risk.”
New construction starts, however, have significantly slowed.
Serlin cites a 50% decline in starts from peak levels in 2022 and 2023, with annualized rates dropping to 325,000 units in 2024. This decline is especially pronounced in Sun Belt markets, traditionally known for driving growth. Everett points out that, in contrast, regions like the Northeast and California have shown modest increases in construction activity, reflecting “a rebalancing of opportunities and challenges across different geographies.”
Extended construction timelines continue to impact the sector. Serlin notes that garden-style developments now average 688 days to complete—a 12.1% increase from 2019—while mid-rise and high-rise properties take approximately 741 and 815 days, respectively. Everett attributes these delays to ongoing supply chain disruptions, labor shortages, and increasing regulatory complexities, which he says “require more proactive planning and agile execution from all stakeholders.”
Both experts agree that 2025 will demand careful navigation from developers and investors. Serlin emphasizes the need for financial modeling that accounts for these prolonged timelines, while Everett advises that stakeholders “prioritize resilience and strategic foresight to remain competitive in a rapidly evolving market.”
The multifamily market in 2025 represents a blend of opportunity and caution.
By leveraging strategic insight, sound fiscal decision-making, and the right construction partners, industry participants can better position themselves to address immediate challenges and seize long-term growth opportunities. As Everett aptly concludes, “2025 is a year to stay nimble and committed to long-term goals in a shifting landscape.”
