Foong on Finance: The Coming Apartment Shortage

There will be a shortage of apartments in 2013.

That is the prediction of Trammell Crow Residential’s (TCR) 2009 Outlook for the U.S. Multifamily Market.

Many have been projecting that given the current constriction of apartment supply, apartment demand will outstrip supply shortly. This study puts a date on it.

The study’s introduction was co-signed by Charles R. Brindell Jr., TCR President and CEO, and J. Ronald Terwilliger, TCR chairman. (Terwilliger was, incidentally, just honored in June with the Housing Person of the Year by the National Housing Conference.)

The authors noted that we will see “strong rent growth beginning in 2011.” However, uncertainty regarding cap rates and falling rent is making it difficult for developers “to contemplate significant new development starts.”