Austin Leads Nation in Apartment Rent Decline in January

The average apartment rent dropped more in Austin in January than in any other major city in the country.

Due to market saturation, Austin’s average rent fell 4.8 percent in January, year-over-year, to $1,381, according to CoStar. That’s the greatest decline among the 50 biggest metro areas in the country, surpassing runner-up Washington, D.C., by more than a percentage point. However, absorption rates suggest that demand may consume enough supply to level out the Austin multifamily market by the end of the year.

Rents have been falling in Austin for nearly two years, after a multifamily building spree chased the swiftly rising demand for apartment living during the early 2020s. Between 2021 and 2023, average rent in Austin rose by more than 30 percent. Austin multifamily construction peaked in 2024, but oversupply continues to depress rents and force landlords to offer concessions that tenants in 2021 couldn’t dream of getting.

Other primary metropolitan areas in Texas also saw rent declines last month. In San Antonio, already the cheapest place to rent of the top 50 cities nationwide, rent dipped 3 percent in January to $1,076 per month, a 3.2 percent year-over-year decline, CoStar reported. Rent decreased by 2.1 percent in Fort Worth to $1,258 in January. Dallas and Houston had the flattest declines in Texas in January, with average rent decreasing by 1.9 percent and 1.8 percent year-over-year, respectively.

It’s not an issue of demand, according to Grant Montgomery, national director of multifamily analytics at CoStar.

“In Texas, demand is quite strong. Many of those markets are actually leaders both on absolute absorption of units, as well as the percentage of absorption,” Montgomery said.

In the last quarter of 2025, Austin absorbed over 3,100 units, the fifth-largest level of any market in the United States, according to CoStar. Measured as a percentage of its total supply, Austin’s absorption last quarter ranked second in the country at 1 percent, trailing only Charlotte.

In light of sustained demand, month-over-month data suggests that rents may soon reach the bottom of the curve. After 19 straight months of decline, Austin posted a marginal increase in rents in January, compared to December. San Antonio, Dallas, Fort Worth and Houston saw similar month-over-month increases.

“One data point does not a trend make. [But] this is the first time it has turned positive on a month-over-month basis,” Montgomery said. “By the end of the year, Austin might get back to breakeven on a year-over-year rent basis, which would be a large accomplishment given the headwinds that it’s faced over the last couple of years.”