Apartment hunters in California may soon have more options as thousands of new units are on the way. A new study by RentCafe highlights the state’s busiest rental markets, with Southern California leading the surge.
According to the 2025 Apartment Construction Report, the Los Angeles metro ranks as California’s top builder and the 11th busiest nationwide, with 12,558 units under construction. Of these, 4,177 units are within the city of Los Angeles itself, underscoring the city’s continued demand for new housing.
Despite California being the most populous state and home to one of the nation’s largest renter populations—about 44% of Californians rent, one of the highest rates in the country—the Golden State accounts for just 8% of the 506,353 new apartments expected nationwide this year. While overall construction is lower than in 2024, the report notes that 2025 totals are still stronger than any year prior to 2015.
The Inland Empire—covering Riverside and San Bernardino—has emerged as one of California’s biggest growth markets. The region more than doubled its apartment completions in 2025, reaching 6,096 units, making it second only to Los Angeles in the state.
San Diego followed with 4,690 units expected this year, while Sacramento added 2,281 new apartments, ranking fifth in the state.
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The Central Valley is also heating up. Fresno, along with Hanford and Corcoran, saw a 43.1% jump in new construction, totaling 1,188 apartments. Across the broader Central Valley, 2,828 new units are projected to open by year’s end.
The San Francisco Bay Area presents a more complicated picture. While 4,175 apartments are slated for completion in 2025, construction is down 51% from last year’s pace.
Within the Bay Area, the city of San Francisco will add 1,331 apartments, but the slowdown comes as rents climb sharply. San Jose also saw a drop, with new apartment completions falling nearly 47.8% year-over-year, totaling 2,757 units.
The demand-supply imbalance is affecting affordability. As ApartmentList notes, “markets that build more apartments see fewer rent increases.” That reality is playing out starkly in the Bay Area: rents have risen 4.6% across the metro area and a striking 10.6% within San Francisco itself, making it the fastest-growing rental market in the country. In contrast, Dallas, Texas—currently in a building boom—saw rents fall 1.4% year-over-year.
Beyond California’s urban hubs, the Central Coast is expected to complete about 1,800 units by the end of the year.
Nationally, however, the construction spotlight is shifting to the South. Nearly half of all new apartments built in the U.S. in the past year are in Southern states, with Texas metros such as Dallas, Austin, and Houston leading the surge. RentCafe attributes this to the region’s status as a “migration magnet” fueled by strong job growth and economic expansion over the last decade.
Meanwhile, the New York metro continues to dominate nationally, securing the top spot for the fourth straight year, powered by large-scale projects in Brooklyn and Manhattan.
Originally reported by Roseann Cattani in The Californian.
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