Demand for Housing Continues to Rise, Even Without Population Growth - Real Estate, Updates, News & Tips

Demand for Housing Continues to Rise, Even Without Population Growth

Residential REITs own more than 1.3 million apartment units and more than 200,000 single family rental houses, as well as manufactured housing, RV parks, and marinas.

The ongoing housing crunch has helped REITs maintain strong operating performance through the past few years. As more adults choose to live alone, demand for housing continues to rise even without population growth. The latest earnings report shows residential REIT FFO was down 2.3% from the previous quarter, but up 6.7% over the previous year in the first quarter of 2024.

Residential REITs are one of the few property sectors outperforming the FTSE Nareit All Equity REITs index in 2024. Year-to-date returns for May 31 are up 2.0% while the FTSE Nareit All Equity REITs index is down 4.3%. Despite slowing rent growth for apartments over the last year, apartment returns were up 5.2% year-to-date. Increases in rent have continued to outpace the consumer price index (CPI) for all goods and services. The rent portion of CPI was up at an annual rate of 5.4% compared to 3.4% for all goods in services in April. With mortgage rates continuing to constrain housing purchases, many people are continuing to rent.

  • >439,000: More than 493,000 multifamily units were constructed in 2023, the highest level since 1987.
  • 17%: Renting a home is more attractive than ever with 17% of apartment residents reporting no interest in purchasing a home.
  • 29%: In 1960, single-person households represented only 13% of all households; that share has risen to 29% in 2022.


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