More Than 76,000 Build-to-Rent Units Under Construction in the South

Although inflation in the U.S. eased in May, the benchmark interest rate remains at a 23-year peak. In a high inflationary environment with high mortgage rates and limited single-family inventories, renting remains a top option for a select portion of the U.S. population. Developers in the build-to-rent (BTR) space have stepped up to fill that need.

Nationally, developers in the South and West lead the pack in the BTR space with roughly 88% of the 119,445 BTR units under construction as of May. On its own, the South claims 64% of the nation’s BTR units under construction, according to RealPage Market Analytics.

At the end of May, the South led the U.S. with 76,674 BTR units under construction completing through 2nd quarter 2027. That total includes properties in lease-up where construction is ongoing and surpasses the next closest region by nearly 48,000 units. The West numbers are also significant, however, with a total of 28,618 BTR units under construction completing through 3rd quarter 2026.

With 11,620 units under construction scheduled to complete by 3rd quarter 2025, the Midwest ranks third for the number of BTR units under construction. Rounding out the four regions is the Northeast with 2,533 units under construction completing through the end of 2025.

BTR, as RealPage defines it, includes single-family housing that is fully detached, semi-detached (semi-attached, side-by-side), row houses, duplexes, quadruplexes and townhouses built for rental.

Homing in on the leading markets in the BTR arena, Phoenix in the West leads the nation with 18,210 BTR units under construction. The South claims most of the next 15 spots with only two Midwest markets (Columbus and Chicago) showing more than 1,500 BTR units under construction.  

In the number two spot is Dallas with 8,198 BTR units underway, while Atlanta claimed the third position with 7,647 BTR units under construction.

Of note, all five of the major Texas markets are on this list. Houston and Austin have nearly 6,000 BTR units underway, while the total in Fort Worth is closer to 5,000. San Antonio has a little more than 3,400 BTR units rising.

In addition to the more than 119,400 BTR units underway nationwide, another 14,156 units are planned. At the forefront of that list with nearly 1,500 units in the pipeline is Phoenix. Charlotte (929 units) and Dayton (807 units) complete the top three spots for markets with at least 500 BTR units planned.

Worth mentioning, five other U.S. markets have 500 or more units permitted as of May: Dallas (733 units), Austin (610 units), Sacramento (591 units), Orlando (570 units) and Indianapolis (538 units). When or if those projects make it across the finish line remains to be seen, especially in the midst of a challenging construction financing environment.

A growing preference for renting over buying means the BTR space continues to offer a viable option for individuals that prefer a single-family lifestyle with renter flexibility thus holding investor interest.