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You Can’t Find a Cheap Apartment Because They’re Building So Few

Apartment Building Construction Ahead Of New Homes Sales Figures
Photographer: Bloomberg/Bloomberg

Property investors have poured no small amount of money and concrete into U.S. rental apartments recently, concentrating on upscale projects in urban cores. The result is a glut of units affordable to affluent renters and far less supply for everyone else.

The vacancy rate for the most expensive 10th of U.S. apartments topped 13 percent in the first quarter, according to a study by CoStar Group Inc. For the rest, the figure was about 6 percent. There were 537,000 apartments under construction -- the most since at least 2000 -- and they’re disproportionately located in the most expensive submarkets, the study shows.