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Build-To-Rent Supply Set To Decline After 2026

Article originally posted on Globe St. on September 16, 2026

New RealPage data show that BTR deliveries are expected to fall sharply through mid-2029 even as construction remains concentrated in fast-growing Sun Belt markets.

Build-to-rent development is still concentrated in the nation’s fastest-growing markets, but the current construction cycle appears to be nearing a turning point. Developers are expected to deliver 40,800 BTR units by the end of 2026, yet the pipeline is projected to contract sharply in the years that follow—potentially creating a much tighter supply environment for investors focused on single-family rentals.

That shift matters because BTR construction remains clustered in a relatively small number of markets. Nearly 60% of the nation’s BTR units under construction are in the South, according to a new RealPage analysis, underscoring the continued importance of Sun Belt population growth and housing affordability pressures to the sector.

For developers and investors, the next phase of the BTR cycle may be less about broad expansion and more about identifying markets with durable rental demand after the current supply wave is absorbed.

Deliveries Expected To Peak In 2026

The BTR sector is expected to reach at least a temporary delivery peak this year. RealPage projects that 40,800 units will be completed by the end of 2026.

After that, deliveries are forecast to decline to 33,100 units in 2027, 8,000 units in 2028 and just over 1,400 units through mid-2029. The decline suggests that the sector’s recent construction boom may be fading, even if new projects continue to move forward.

The expected slowdown makes current construction starts particularly consequential. “Today’s construction starts may play an outsized role in shaping future supply,” RealPage said in its analysis.

For investors, fewer future deliveries could ultimately improve the supply-demand balance in markets where renter demand remains strong. But the near-term impact will depend on how quickly existing projects come online and how well individual markets absorb the units now underway.

The South Holds The Largest Pipeline

The South remains the clear center of BTR development. Of the 59,660 units under construction nationally in August, about 36,000 were located in the region, representing 60% of the total pipeline.

That is three times the approximately 12,000 units underway in the West, the next-largest region for BTR construction. The Midwest had 10,203 units under construction, while the Northeast had just 2,015.

The regional imbalance reflects where the sector has found its strongest demand drivers: population growth, household formation and continued affordability challenges in the for-sale housing market. Those conditions have helped support demand for rental homes in many Sun Belt metros, even as higher borrowing costs and broader economic uncertainty have complicated development decisions.

Development Is Clustered In Key Metros

BTR construction is not only concentrated by region; it is also focused in a relatively small group of metropolitan areas. Just 16 markets had more than 1,000 units under construction in August.

Dallas had 3,943 units underway, followed by Atlanta with 3,348, Charlotte with 2,703, Houston with 2,692 and Tampa with 2,072. Phoenix also ranked among the leading markets for BTR development.

The concentration matters because it heightens the importance of local conditions. Investors evaluating BTR opportunities will need to weigh incoming supply against each market’s population growth, employment trends, housing costs and depth of renter demand.

A market with a large development pipeline may still offer opportunity if underlying demand can absorb new inventory. Conversely, concentrated supply may create greater leasing and rent pressure in markets where growth slows or affordability improves.

Planned Projects Keep The Focus On Growth Markets

The next group of planned BTR projects points to the same broad geographic pattern. More than 6,000 units are planned across markets including Phoenix, Nashville, Fort Worth, Kansas City, Raleigh-Durham, Columbus and San Antonio.

Many of those metros continue to benefit from the demographic and affordability dynamics that have driven BTR investment in recent years. They are also markets where renters may seek more space and single-family living without the financial commitment of homeownership.

Still, the projected drop in deliveries after 2026 suggests future returns may depend more on market selection than on the broad momentum that lifted the sector during its recent expansion.

As RealPage noted, developers and investors will need to balance growth opportunities with evolving economic conditions while focusing on markets with the strongest long-term demand fundamentals.

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