Apartment rentals are skyrocketing across Texas, latest report from National Association of Real Estate Agents (NAR). This is good news for landlords, but tenants face steep rent increases.
The Dallas-Fort Worth area has dominated the country over the past 12 months with 47,182 apartments occupied, Houston in second place at 37,117. Austin came in eighth with 20,443, just behind Chicago. San Antonio came in 18e with 10,808, behind Minneapolis.
According to Scholastica “Gay” Cororaton, senior economist and director of housing and commerce research for NAR, Texas as a whole has attracted a large number of people in 2020.
âDallas (and) Houston are the two main areas that attract people,â Cororaton said. “And I think one (reason) is that the rents are still relatively cheaper there.”
But this reality is changing rapidly. Like much of the country, major cities in Texas are experiencing double-digit annual increases in the cost of renting an apartment.
âWith people moving (to Texas) and also with the limited supply of housing, it drives up rents,â Cororaton said.
The situation is not as bad in Texas compared to places like California or New York, but it is bad enough for tenants. Year over year, rents were up 10.4% in Houston, 13.1% in San Antonio, 14.9% in Dallas-Fort Worth and 21.6% in Austin. The national average has increased by about 11% in the past 12 months.
It comes at a time when eviction rates are skyrocketing across the country due to the COVID-19 pandemic and its effects on low-income residents.
A silver lining, according to Cororaton, is that the massive influx of tenants has spurred an increase in multi-family home construction in Lone Star State. This could potentially help slow the rise in rents as the supply of state apartments increases.
âFor Austin,â Cororaton said, âyou have about 20,000 units under construction, which is about 8.3% of the current inventory.â
Cororaton added that new construction in Houston represents about 3% of the current inventory.
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