Houston Apartment Rents Fell 3.5 Percent Last Year

HOUSTON – (By Dale King, Realty News Report) – Houston’s apartment rents fell 3.5 percent in 2020, the year the coronavirus pandemic crushed the economy.

The average cost of leasing a unit within the Bayou City hasn’t nudged upward since before the pandemic took hold last March, says the just-released January 2021 Houston Rent Report from Apartment List.

However, rental rates in many of Houston’s suburban communities haven’t suffered.

The full January Apartment List Rent Report concludes there has been significant regional variation in the impact of the COVID-19 pandemic across the US. While the national rent index is down by a fairly modest 1.5% year-over-year, many markets are experiencing greater volatility.

“The urbancores of San Francisco, Seattle, Boston and New York City continue to see rent prices fall rapidly, while many smaller markets and suburbs are actually getting more expensive.”

“While the recent trend is more or less in line with the past, it comes after a summer that was anything but normal,” the report notes. “The COVID-19 pandemic forced renters to hit pause on their spring moving plans, prices fell steadily from March through June, during what is typically the busy season for the rental market when apartments get more expensive, not less.”

Meanwhile, in Texas, “Houston rents have declined 0.4% over the past month and are down significantly — by 3.5% — compared to the same time last year. Currently, median rents in Houston stand at $898 for a one-bedroom apartment and $1,068 for a two-bedroom. This is the ninth straight month that the city has seen rent decreases after an increase in March [2020]. Houston’s year-over-year rent growth lags the state average of -2.1%, as well as the national average of -1.5%.”

The report says some renters are heading for Houston’s neighborhoods outside the center city to find more adequate digs where prices may be lower or, at worst, just a bit higher.

While rent prices have decreased in Houston over the past year, the rest of the metro is seeing an opposite trend. Rents have risen in five of the largest 10 suburban markets in the Houston metro area.

Here’s a look at how rents compare across some of the largest cities in the Houston metro:

Over the past year, Houston proper has seen the biggest rent drop in the metro, with a decline of 3.5%. Median two-bedrooms there cost $1,068, while one-bedrooms go for $898.
Rosenberg has seen the fastest rent growth in the metro, with a year-over-year increase of 2.1%. The median two-bedroom unit there costs $1,064, while one-bedrooms go for $886.
Baytown has the least expensive rents in the Houston metro, with a two-bedroom median of $1,034. Rents were down 0.5% over the past month but remained flat year-over-year.
League City has the most expensive rents of the largest cities in the Houston metro, with a two-bedroom median of $1,629. Rents decreased 0.7% over the past month but were up 1.9% over the past year.

While rents in Houston have fallen significantly, comparable cities nationwide have seen prices increase, in some cases, substantially. Still,

“Houston is more affordable than most other large cities across the country,” the report notes.

The Apartment List offers the following information on rent changes in other Houston metro communities:

Texas as a whole has logged a -2.1% year-over-year decline, while other cities across the state have seen rents moderately on the rise.
Houston’s median two-bedroom rent of $1,068 is slightly below the national average of $1,090. Nationwide, rents have fallen by 1.5% over the past year compared to the 3.5% decline in Houston.
While rents in Houston fell significantly over the past year, many cities nationwide saw increases, including Memphis (+6.9%) and Phoenix (+4.2%).
Renters will find more reasonable prices in Houston than most similar cities. For example, San Francisco has a median two-bedroom rent of $2,305, which is more than twice the price in Houston.

The following list includes Houston and its metros along with their median one-bedroom and two-bedroom rents: Houston, $900 and $1,070; Pasadena, $830 and $1,050; Pearland, $1,320 and $1,560; League City, $1,280 and $1,630; Sugar Land, $1,180 and $1,500; Baytown, $820 and $1,030; Galveston, $890 and $1,130; Rosenberg, $890 and $1,060 and Tomball, $940 and $1,170.

The coronavirus has either drastically slowed or just plain halted the wheels of progress at many levels in the city of Houston. Job losses have been significant and multifamily markets have been impacted, but a number of new communities are being built. Hines and High Street are constructing high-rise apartment towers in downtown Houston.

File: Houston Apartment Rents Fell 3.5 Percent Last Year

Caption: The new Fein Canopy at Springwoods Village apartments.