More than half of the over 500,000 new apartments being built this year will be in Sunbelt states.

Experts indicate that the surge underscores an increasing scarcity of affordable homes, driving residents towards rentals — a demand developers are keen to fulfill.

Bustling Texas metros such as Dallas, Austin, San Antonio, and Houston are at the forefront of the apartment construction surge in the region, as reported by RentCafe.

Other migration magnets, such as Naples, Florida, have seen a huge surge in construction in just the last year alone.

Out of the 506,353 apartments anticipated to be completed by the end of the year, 265,613 — or 52.5 percent — are expected to be situated in the Sunbelt, the warm southern region from California to the Carolinas.

According to Doug Ressler of Yardi Matrix, who supplied the data, developers are attracted to the region’s business-friendly environment, lower expenses, and more lenient zoning regulations compared to coastal gateway cities.

At the same time, a lack of affordable homes to buy are pushing residents towards renting, he added.

‘For many households, single-family (housing) ownership is simply out of reach — fueling demand for rental housing.’

The South is seeing a boom in apartment construction (Pictured: Miami, Florida)

Buyers are struggling to afford homes as prices and mortgage costs soar. 

A significant number of sellers are opting to withdraw their homes from the market instead of lowering prices, which is steering buyers towards rental properties. This trend is occurring more rapidly in the Sunbelt than elsewhere in the US.

As such, in 2025, Texas is on track to open 81,407 new apartments, while Florida will see 62,184 new units. 

Together, these two states will account for nearly half of all Southern completions and almost 30 percent of new apartments nationwide. 

“Southern metros generally offer simplified approval procedures and fewer regulatory obstacles, making it easier to launch multifamily projects,” stated Ressler.

Some areas have also seen a notable surge in construction in the last year alone.   

Naples, Florida, saw the biggest jump in apartment construction this year, with expected completions up a staggering 275 percent from 2024 to more than 3,100 units.

Likewise, Birmingham, Alabama, nearly tripled its output with over 1,700 apartments on track to open.

Naples, Florida, saw the biggest jump in apartment construction this year, with expected completions up a staggering 275 percent from 2024 to more than 3,100 units

Naples, which has long been known for its affluent retirees and resort living, is shifting toward broader housing diversity as population growth spills over from other parts of the state, according to RentCafe.

As a result, developers are responding to growing demand from remote workers, service-sector employees, and younger transplants priced out of Miami and Tampa.

In Birmingham, the city’s relatively low cost of living and emerging tech scene is attracting young Americans — which is getting the attention of developers.   

On the flip side, Chicago recorded the steepest drop, with new construction plunging 60.4 percent from 2024 to 3,756 units in 2025. 

Local developers are navigating a mix of high labor and material costs, as well as rising insurance premiums, which are seriously dampening new construction. 

Madison, Wisconsin, follows closely with a 59.3 percent decrease over the year, leaving just 1,664 units projected to be completed by the end of 2025. 

While the metro remains popular with college students and young professionals, higher interest rates and a wave of high-end apartments appear to be slowing new projects, said RentCafe.

Chicago recorded the steepest drop, with new construction plunging 60.4 percent from 2024 to 3,756 units in 2025

Doug Ressler, senior analyst and manager of business intelligence at Yardi Matrix 

On the city level, Austin is leading the way for apartment construction this year, with an estimated 15,195 new units expected. 

Second is Charlotte, North Carolina, which reflects a rising demand in the city from many young professionals, families, and remote workers. 

Houston came in third, with San Antonio and Dallas also making the top ten cities for new construction. 

In terms of metro area, however, New York comes out on top for the fourth consecutive year. 

Due to heavy construction in Manhattan and Brooklyn, 30,023 new apartments are set to open in the area in 2025.