The majority of apartment seekers are targeting DFW from outside the metro area, a number that hasn’t changed as an effect of COVID, suggesting that DFW continues to attract more people to relocate to the metroplex. Even though expectations of a significant decline in area construction due to COVID-19-imposed restrictions, multi-family construction spending is trending only slightly lower than in 2019.

In addition to migration to the area keeping demand relatively high, a recession indefinitely drives more people to multifamily housing. Many people are forced to tap into their savings and therefore lose access to available cash they might have used for a down payment on a home. Instead, they will often opt for renting in order to build up their equity until they can comfortably buy a home with a good-sized down payment.

While many firms are working harder than ever to meet the market demand for multifamily projects, most are at full capacity and are simply unable to complete drawings, oversee permitting, and manage construction in order to meet current market demand for new designs. With the increasing volume in multifamily development, challenges in construction and delivery, developers are encountering significant delays in their project timelines that they simply can’t afford.

When COVID-19 brought much of the country to a screeching halt in March, much of the lumber industry did not place orders for materials, as they anticipated very little construction activity through the summer. But in many areas, especially North Texas, building barely slowed down, and now the supply for lumber building materials is unfortunately low, causing the price of lumber to skyrocket over 200% what it was the same time last year.

Alternately, many suppliers overordered steel during the trade war with China in anticipation of steep tariffs. Now, there are warehouses filled to the brim with steel materials that haven’t been used and need to be cleared out to make room for other materials that need to be stored. As a result, the price of steel is far lower than lumber. Many builders can now utilize steel modularization and panelization to accelerate construction installation and even use a hybrid system of 10% lumber, 90% steel to go vertical with a building under what was budgeted last year. As a result, developers are able to get a much sturdier, safer, and higher quality structure with steel for a fraction of the cost, and manufacturers like Texas Steel Tech are helping developers complete their projects on schedule with modularization and panelization.