Rents are up in Houston, but an influx of multifamily supply has helped keep prices relatively affordable.
Monthly rents in the Houston area reached an average of $1,358 at the mid-year point, marking a 4 percent increase year-over-year, the Houston Chronicle reported, citing a study by real estate firm Berkadia.
Nationwide, residential rents increased 3.6 percent year-over-year last quarter. Despite having larger percentage gains than the national figure, rental prices in Houston were 33 percent lower than the national average, 23 percent less than in Austin and 14 percent lower than in Dallas-Fort Worth.
Unlike other Texas metros, such as DFW, prices in Houston continue to climb. In 35 submarkets tracked by Berkadia, rents increased or remained neutral at midyear compared to the same period in 2022.
Rent hikes were most significant in Houston’s East Inner Loop, rising 15.8 percent from one year prior to $1,440 per month. This area is near sports stadiums and several new developments, such as Midway’s 150-acre, $2.5 billion East River project.
In southwest Houston, Alief and Sharpstown also registered some of the largest gains. Rents in Alief increased by 8.9 percent to $1,039, while Sharpstown’s shot up 8.4 percent to $931, the outlet reported.
North Central Houston had the third largest spike in rents, climbing 7.1 percent to $966. Prices rose 6.4 percent to $2,047 in Greenway and Upper Kirby, rounding out the top five.
As multifamily developments continue to proliferate in the Bayou City, rents are likely to fall due to a greater imbalance of supply over demand. More than 21,700 apartment units are slated to be delivered in the Houston area this year, with another 23,700 on the way in 2024.
However, it could take a while for some of these projects to get underway, with high interest rates and construction costs potentially hindering development activity.
—Quinn Donoghue
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