2023-10-25 13:34:33
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Oklahoma City ranks last among major metros in the nation when it comes to its percentage of new construction dedicated to apartment complexes and other properties intended for multifamily occupation.
That’s according to a new study by constructioncoverage.com, an industry watcher that examined U.S. Census Bureau statistics to gauge a national trend toward more multifamily residence construction.
Inadequate housing supply has been a key factor contributing to housing unaffordability in the U.S. for a number of years. Federal mortgage backer Freddie Mac estimated in 2020 that the nation had a need for 3.8 million additional housing units.
While widespread needs were aggravated by the pandemic, in 2022 construction or plans for construction of such properties spiked to their highest level since 1985, constructioncoverage.com analysts reported.
But not in Oklahoma.
According to the study, while 41.4% of new housing units authorized across the nation in 2022 were identified as multifamily, in Oklahoma, the percentage was 20.3%.
OKC ranked last among major metros for multifamily dwelling construction at 13.6%. Tulsa ranked better at 25% but lagged most other metros. The study noted that Lawton, with a 0% share of multifamily construction starts in 2022, ranked among small cities in the nation with the least emphasis placed on construction of multifamily dwellings.
While larger cities traditionally have witnessed greater percentages of stock in multifamily housing, analysts noted that current needs have extended to smaller cities, and many have responded with greater emphasis placed on apartment or other multifamily dwelling construction.
By comparison to Oklahoma City, 56.8% of construction last year in Richmond, Virginia, with a metro area population of regarding 1.3 million, was for multifamily dwellings. Denver, with a metro area population approaching 3 million, had a ratio of 56.9%. The two cities brought up the tail end of metros ranked in the top 15 for multifamily construction. In New York City, ranked as the top metro for such construction, 79.3% of housing licensed for construction last year was identified as for multifamily occupation.
“Despite (nationwide) challenges, one promising sign for housing supply is an uptick in planned multifamily home construction. Multifamily housing increases the density and availability of housing units in urban and suburban locations, and it is more efficient and cost-effective to develop than single-family stock,” the report states. “And with more people now returning to their offices, denser housing closer to work and social attractions is regaining its appeal.”
Nationally, approximately 28% of the current housing stock falls under the multifamily category. By comparison, 18.6% of current housing stock in Oklahoma falls into that category.
Here’s a summary of 2022 stats for the state:
• Share of new housing units authorized in multifamily structures: 20.3%.
• Total new housing units authorized in multifamily structures: 2,793.
• Total new housing units in structures with two units: 692.
• Total new housing units in structures with three to four units: 98.
• Total new housing units in structures with five-plus units: 2,003.
• Total new single-family units: 10,942
By way of comparison, here are the same stats for the U.S.:
• Share of new housing units authorized in multifamily structures: 41.4%.
• Share of existing housing units in multifamily structures: 28.4%.
• Total new housing units authorized in multifamily structures: 689,504.
• Total new housing units in structures with two units: 31,626.
• Total new housing units in structures with three to four units: 23,205.
• Total new housing units in structures with five-plus units: 634,673.
• Total new single-family units: 975,584.
New York State leads the pack with the highest proportion of existing homes classified as multifamily, standing at 52.5%, followed by Massachusetts (43.1%), Rhode Island (38.6%), Hawaii (36.4%), and New Jersey (36.0%). Conversely, states in the South, Midwest, and Mountain West which tend to be more rural, have traditionally allocated fewer resources to medium- and high-density housing. For instance, in West Virginia, Idaho and Mississippi, less than 17% of the existing housing stock comprises multifamily units.
Notably, there has been a “compelling surge” in multifamily home construction in unexpected regions, the study noted. Areas in the Midwest and West, traditionally characterized by average or below-average concentrations of multifamily housing, have ascended to the forefront in terms of the proportion of newly authorized multifamily units. This includes states like South Dakota, Washington, Minnesota, Nebraska, Colorado and Montana, all of which now exceed the 50% mark.
The South reported the lowest rates of new multifamily housing, likely attributable to lower demand and lower home prices compared to other regions of the country.
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