(NewsNation) — The U.S. is poised to set a new record in apartment construction for the third year in a row in 2024, as high rental demand continues to fuel a multifamily construction boom, according to a new report from RentCafe.

Over half a million apartments are expected to hit the market by the end of the year, marking a 9% increase from 2023 and a 30% rise from 2022. This will be the first time the number of completed apartments will surpass 500,000.

The New York metro area is leading the charge, followed by the Dallas and Austin metro areas. Dallas and Austin are expected to contribute about 10% of all apartments opened nationwide. Nearly 60% of the new apartments expected to open this year are centered in just 20 metros.

The increased supply of apartments comes as the real estate market is facing a housing shortage, even with the rise in apartment construction. However, the report says demand continues to be higher than supply in meeting the most significant growth in renters over the last 50 years.

The increased supply of apartments is expected to soften rent growth. According to RentCafe, the average rent for an apartment in the U.S. is currently $1,713.

However, most of the apartments built in the last five years, as well as those still under construction, are high-end and cater to mostly upper-middle-class and high-income renters. This focus on high-end apartments — combined with the concentration of new units in the largest U.S. cities — means renters in smaller markets may continue to have limited affordable options.

Despite uncertainties for the future of apartment construction that are causing fewer new projects to start, two million apartments are expected to hit the market by 2028.

“The supply wave has brought 50-year high deliveries to certain metros … but the increased competition is slowing rent growth, especially in booming Sun Belt markets,” said Doug Ressler, senior analyst and manager of business intelligence at Yardi Matrix.