The 96-unit Pine Lake Village apartment community in Houston was recently sold.
HOUSTON – (By Dale King, Realty News Report) – Rent prices in the city of Houston have basically flat-lined for the past 12 months. And while prices nudged up slightly in April, May and June, Houston’s year-over-year rent rate growth of just 0.5% lags far behind the Texas state average of 1.7% and the national average of 1.6%.
Currently, says Apartment List’s report for July 2019, median rents in Houston stand at $850 for a one-bedroom apartment and $1,030 for a two-bedroom residence. This is the third straight month of rent increases in the city following a deep dip in March.
The report offers the following information on how rents compare across some of the communities in the Houston metro area:
Pasadena has the least expensive rent, with a median, two-bedroom charge of $1,010. But that city has also experienced the fastest rent growth in the metro, with a year-over-year increase of 2.6%
Sugar Land has seen rents fall by 1.2% over the past year, the biggest drop in Greater Houston. But it is also the most expensive city in the metro area with a two-bedroom median rent of $1,560.
From most to least expensive rent for a two-bedroom apartment, the top 10 cities in the Houston metro are: Sugar Land, $1,560; League City, $1,500; Missouri City, $1,450; Spring, $1,380; Pearland, $1,350; Conroe, $1,100; Galveston, $1,090; Baytown, $1,080; Houston, $1,030 and Pasadena, $1,010.
Rents has increased moderately in other cities across the state, with Texas as a whole logging rent growth of 1.7% over the 12 months. For example, rents have grown by 3.5% in Austin, 2.5% in San Antonio and 1.9% in Dallas.
Houston’s median two-bedroom rent of $1,030 is below the national average of $1,190. Nationwide, rents have grown by 1.6% over the past year compared to the 0.5% increase in Houston.
While Houston’s rents rose slightly over the past year, many cities nationwide have seen more significant hikes, for example, Phoenix (up 3.8%), Washington, D.C. (up 2.3%) and Seattle (up 1.6%)
This is good for would-be renters since they will find more reasonable prices in Houston than most similar cities. For example, San Francisco has a median 2BR rent of $3,100, which is more than three times the price in Houston.
The modest growth in rents is not keeping investors away from Houston, said Clint Duncan, Senior Vice President of CBRE’s Capital Markets Multifamily Group. The underlying fundamentals of the Houston multifamily market are good, and investors are buying apartments with confidence that rents will rise over time, Duncan said.
The Apartment List report offers the following data about Texas metros:
DALLAS: Rents have increased 0.6% over the past month, and by 1.9% in the last 12 months. Currently, median rents in Dallas stand at $910 for a one-bedroom apartment and $1,130 for a two-bedroom. This is the fifth straight month that the city has seen rent increases after a decline in January.
Dallas’ year-over-year rent growth is larger than both the state average of 1.7% and the national average of 1.6%.
In the Dallas metro, Arlington has seen the fastest rent growth with a year-over-year increase of 2.8%. The median two-bedroom rental there costs $1,260, while one-bedrooms go for $1,010.
Dallas proper has the least expensive rents in the Dallas metro, with a two-bedroom median of $1,130.
Plano has the most expensive rents of the largest cities in the Dallas metro, with a two-bedroom median of $1,450. Rents in Plano grew 0.5% over the past month and 2.1% over the past year.
AUSTIN: Rents have increased 0.8% over the past month and 3.5% in the past 12 months. Currently, median rents in Austin stand at $1,180 for a one-bedroom apartment and $1,450 for a two-bedroom. This is the fourth straight month that the city has seen rent increases after a decline in February.
Renters will generally find more expensive prices in Austin than most similar cities. For example, Detroit has a median 2BR rent of $900, where Austin is more than one-and-a-half times that price.
SAN ANTONIO: Rents have increased 0.4% over the past month, and are up by 2.5% during the past year. Currently, median rents in San Antonio stand at $860 for a one-bedroom apartment and $1,080 for a two-bedroom. The city’s rents have been increasing for 17 straight months. The last time rents declined was in January of last year.
Nationally, Henderson, Nev., leads the way with a 5.1% increase in rent prices, more than three times the national rate. Henderson is located just outside of Las Vegas, which ranks third on the list at 3.9%.
The Las Vegas metro has seen rapid job growth in recent years, but many of those jobs are in low-paying service and tourism industries, and continued rent hikes could lead to affordability concerns, says the report.
The Phoenix area is also experiencing rent growth well above the national average. The Phoenix suburb of Mesa ranks second for fastest rent growth in the nation at 4.4%, with Phoenix-proper coming in at fourth with year-over-year growth of 3.8%.
The Apartment List report says Texas and North Carolina also each have multiple cities in the top 10. Communities on the list are all located in regions with strong local economies which offer good employment opportunities.
July 22, 2019 Realty News Report Copyright 2019