The Wilmington area is expected to add nearly 3,000 new rentals this year – the highest number of new units completed in a single year in the last decade, according to a recent report.

The report from commercial real estate research firm Yardi Matrix looked at apartment construction in 370 U.S. metro areas, including Wilmington. The findings predict an uptick in apartment construction nationwide, starting this year and continuing through 2028.

According to Yardi Matrix data, the Wilmington area is expected to add 2,899 new apartments by the end of this year. Most of those units – 2,521 – would be within Wilmington’s city limits.

By 2028, the metro area is projected to add another 6,879 new apartments – 1,059 more new units compared to the last five-year period in which 5,820 units were added, according to Yardi Matrix. Inside Wilmington’s city limits, the apartment supply is projected to increase nearly 14% in the coming years, with approximately 6,072 new units expected by 2028.

The uptick in local rentals reflects broader building trends as 2024 is “shaping up to be a historic year” for apartment construction nationwide, according to Yardi Matrix. More than 500,000 new rentals are set to open before the end of the year.

That marks a 9% increase from last year and a 30% uptick since 2022. It would also be the first time nationwide apartment completions surpassed the 500,000-unit threshold, according to Yardi Matrix.

New York City has been leading apartment construction for the third year in a row, with nearly 33,000 rentals expected to be completed this year. Dallas and Austin came in second with 32,932 new units and third with 21,506 new units, respectively.

Charlotte and Raleigh made it into the top 20 metros for new apartments this year with Charlotte expected to add 14,658 units and Raleigh expected to add 9,228.

Despite this year’s apartment boom, the research firm expects the momentum of apartment construction to slow through 2027 with a potential rebound in 2028.

High borrowing costs and market uncertainty have forced many in the multifamily sector to take a new approach. That might mean focusing on lower-risk projects or shifting into markets with strong demand and job growth, according to the report.

“The overall impact on the number of developers might vary by region. In places like Texas, for instance, the demand for apartments remains robust due to factors like corporate migration and high home prices,” Doug Ressler, a senior analyst and manager of business intelligence at Yardi Matrix, stated in the report. “On the other hand, some markets are seeing a slowdown in new construction starts due to the economic environment.”

Still, the research group projects 2 million new apartments will open in cities throughout the U.S. between now and 2028.

In Wilmington, the demand for housing units and affordable housing remains high. An annual housing report released earlier this year by the Workforce Housing Advisory Committee, a joint committee appointed by New Hanover County and city of Wilmington leaders, showed that approximately 52% of Wilmington-area renters remain cost-burdened and the area has a gap of approximately 2,900 rental and for sale units.

Local governments and the New Hanover Community Endowment have taken steps to invest in housing and address the shortage. Earlier this year, for example, the endowment unveiled an investment strategy that could allocate up to $19 million to support existing and future housing programs across New Hanover County.