Yardi Matrix has updated its Multifamily Supply Forecast, projecting a roughly 2% increase in unit completions for this year through 2027 compared with its first quarter report.
This modest increase was driven by a slightly larger than expected under-construction pipeline at the end of the first quarter. The pipeline peaked in March 2024 and has declined for 12 consecutive months. However, it still contains a large supply inventory.
Multifamily deliveries this year are forecast to total around 536,000 units, the second-highest level of new supply since the Great Financial Crisis. The numbers are expected to dip to 422,301 in 2026 and 350,257. A rebound is forecast for 2028, 2029, and 2030, when deliveries will move back over the 400,000-unit mark.
Last year, the industry saw construction starts moderate significantly, declining 36.4% from 2023’s level.
“The large decline will drive a slowdown in new supply in 2026,” noted the Yardi Matrix analysts. “However, elevated completion times and a still large under-construction inventory imply that supply will not completely bottom until 2027.”
According to Yardi Matrix’s Q2 2025 Multifamily Supply Forecast, the under-construction pipeline ended the first quarter with 1.105 million units, a 5.1% decrease quarter over quarter and a 13.3% decrease year over year.
At the end of the first quarter, 537,716 of these under-construction units were in pre-lease, down 12% quarter over quarter and 13.1% year over year. According to Yardi Matrix, most of this inventory should be complete by the end of 2026’s first quarter.
Units under construction, but not in lease-up, at the end of the first quarter increased 2.5% quarter over quarter to 567,539; however, this segment decreased 13.4% year over year. These units are expected to be completed in 2026 or early 2027.
Elevated completion times are still hampering the industry, rising to their highest levels since 2018. In the first quarter, the average garden-style property completion times were 718 days or 23.9 months, above the trailing four-quarter average of 688 days.
For mid-rise properties, the average property completion times stood at 837 days or 27.9 months, above the trailing four-quarter average of 786 days.
Completion times increased substantially for high-rise properties, to 1,043 days or 34.8 months. This is well above the trailing four-quarter average of 887 days.
As it looks ahead, Yardi Matrix’s Q2 2025 Multifamily Supply Forecast assumes the current policy will have a negative effect on real GDP growth. However, with the relative strength of the economy, the one-off tariff shocks will not force a recession on their own.
“The new administration’s policy objectives and execution have introduced greater-than-normal uncertainty into the long-term forecast. One the one hand, higher tariff rates will result in a one-off increase in import prices and construction costs, a potential headwind for new development. Additionally, higher tariff rates also imply a near-term slowdown in economic activity that depresses rental rate growth and thereby new development interest,” the report noted. “On the other hand, a weaker growth environment would also lead to easing monetary policy and provide a tailwind for new multifamily development.”
