Permits Up, Pipelines Full: A Snapshot of Metro Supply Risks

Dennis Lee
Nov 5
2 min read

Before rents cool, cranes move.

This week, we mapped every major U.S. metro across two key development metrics:

X-axis: 6-month building permits (5+ units)
Y-axis: Construction pipeline expected to complete within 2 years

By ranking both metrics by percentile, we plotted each metro in a four-quadrant matrix to identify its position in the multifamily supply cycle.

The goal is to assess oversupply risks and potential development opportunities across markets.

Quadrant Summary

🔴 Q1. High Permits / High Pipeline — Oversupply Risk Zone

Both current construction and new permitting are high, signaling potential short-term oversupply.

Metros: New York, Dallas, Miami, Austin, Atlanta, Phoenix
➡️ Developers are highly active; rent growth may slow as new supply hits the market.

🟠 Q2. Low Permits / High Pipeline — Late-Cycle Markets

Many projects are already underway, but new permitting has slowed. These markets are approaching the end of the supply cycle.

Metros: Philadelphia, San Antonio, Kansas City, Louisville
➡️ Short-term supply pressure, but medium-term normalization likely.

🟢 Q3. Low Permits / Low Pipeline — Stable / Undersupplied Markets

Limited ongoing and future supply. Rents tend to hold steady with low vacancy pressures.

Metros: Detroit, Baltimore, Portland, Nashville, Cleveland, Memphis
➡️ Conservative construction activity; steady fundamentals.

🔵 Q4. High Permits / Low Pipeline — Early-Cycle Growth Markets

Few projects currently under construction but new permits are picking up — early indicators of renewed developer confidence.

Metros: Riverside, Jacksonville, Minneapolis, Richmond
➡️ Emerging activity; poised for new development wave.

Takeaway

This quadrant analysis helps multifamily investors identify which metros are overbuilt, stabilizing, or gearing up for a new development cycle, supporting better-informed investment and market timing strategies.