RICHMOND, Va. — The number of new apartments in Richmond’s metro area has decreased by nearly half in 2025 compared to last year, according to Rent Cafe.
The apartment search website reported the area will see just over 2,400 new apartments come online in 2025 versus the 4,510 units delivered in 2024.
Richmond ranked 11th (-46.6%) among the top 20 metros with the steepest year-over-over decline in apartment completions behind Spartanburg, South Carolina (-47.8%) and San Jose, California (-47.8%). Chicago experienced the largest decline in new apartments this year at a 60.4% drop.
Doug Ressler, manager of business intelligence at Yardi Matrix that operates Rent Cafe, said the slowdown is caused by inflation plus the cost to develop, labor and materials.
Interest rates are also higher than when companies financed new construction projects years ago.
More people are looking for cheaper areas to live and they’re landing in the Richmond area.
"I think one of the things that stands out in Richmond is its close proximity to major hubs like DC or Norfolk. In addition, the cost of living is slightly less," Ressler said.
Axios reported that just over 40,000 people moved to the Richmond Metro between 2020 and 2023, according to data compiled by the University of Virginia's Weldon Cooper Center.
Apartments.com revealed the average rent in the Richmond area is just over $1,400 a month for a one-bedroom apartment, which accounts for a two percent increase in 2024.
An affordable rent for the area’s median income would realistically be about $1,300, Ressler said. Experts said a renter should pay no more than 30 percent of their annual income on living, so multiple roommates are renting one-bedroom units to save money.
Finding affordable housing is hard especially without extra amenities included in new luxury apartment complexes like in the Scott’s Addition neighborhood.
"We're not building enough housing. We're not building enough affordable housing, and the demand keeps growing exponentially," Ressler said.
Building luxury apartments allows builders to recoup their money faster. Some complexes may participate in the Section 8 Housing Choice Voucher program, but only a handful of units are dedicated to receiving that discount.
"You can't build something and not be profitable. You can't build something at a loss," Ressler said.
Luxury living isn’t hard to find
Stumbling on construction sites in Richmond’s Scott’s Addition neighborhood is not unusual, especially as crews are building several massive luxury apartment complexes.
The Ace on North Arthur Ashe Boulevard advertises a destination where residents are excited to come home and connect with their friends and neighbors.
General Manager Karen Loving expected 15 percent of the 295 units to be filled by the end of the month.
The Ace offers amenities to set themselves apart from their nearby competition like The Scout, Otis Apartments, and Scott’s Collection.
"Amenities are very important because people are looking for a lifestyle. People are looking for a place that they can gather with their friends without having to go out if they don't want to,” Loving said.
Amenities include custom desks and storage inside the units along with free co-working spaces plus printing. Crews installed a state-of-the-art fitness center with a rotating rock wall and Echelon fitness equipment. Renters can enjoy an expansive clubroom with a fireplace, televisions, and a kitchen plus a dog spa and self-cleaning park.
That’s in addition to a pool, grilling station, and lounging space located in the courtyard.
Loving said renters can factor saving on memberships to private fitness centers and co-working spaces into their rent.
"We have designed this space so that people feel like they're at home no matter where they go," she said.
They hope to attract new Richmonders who are moving from more expensive areas like New York City and Washington DC.
For example, Apartments.com showed the average rent for a one-bedroom unit in the nation’s capital at $2,301, about $600 more expensive than a one bedroom at The Ace.
Rent Cafe showed New York City, Dallas, Austin, Phoenix and Atlanta among the top 20 US metros for new apartments in 2025. However, 52.5% of the total new apartments across the nation are being built in the South.
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