Which City Is the Hardest to Add New Apartments?
Find out which city is the hardest to add new apartments, which is easiest and where your city fits in the new Barriers to Apartment Construction Index, based on new research from Hoyt Advisory Services, commissioned by NAA and NMHC. The research examines and ranks 50 metro areas based on specific factors, including local regulations and the amount of available land to develop.
The Index scores 50 metro areas in a ranking that goes up to 19.5 in the most difficult market to add apartments (Honolulu) all the way down to -5.9 in the easiest (New Orleans). While real estate is very project specific, any score above the median of 1.8 means that it is harder to add new apartments in a specific metro compared to other metros.
“That the index can quantify all these challengers including NIMBY-ism is impressive — and could prove to be very useful as the industry and members of the community petition their policymakers for relief,” says Paula Munger, NAA’s Director of Industry Research and Analysis.
Regardless of where each metro area ranks, the United States needs to build at least 4.6 million new apartments by 2030 to meet the expected increase in demand; otherwise the affordability problems that exist today will only get worse.
There is a strong correlation between the difficulty of adding new supply and affordability, as measured by the percentage of households spending 35 percent or more of their incomes on rent. Nearly half of residents in Miami, Honolulu, Riverside and Los Angeles fall into this category, and these markets are some of the hardest in which to add new supply.