HOUSTON—More households are making the shift from owning to renting, according to recent research from CBRE.
Led by markets in southern and western states, net absorption grew by an annual rate of 276,200 units, or 1.9 percent, on a year-over-year basis, with Houston and Dallas leading the pack. Other contributors to the growth include New York, Los Angeles, Austin, Atlanta, Washington, D.C., Seattle, Denver, Orlando, Raleigh, Tampa and Boston. Together, the cities accounted for more than half of the period’s total net absorption.
“Houston’s strong job growth continues to push our rental market forward,” said Ryan Epstein, executive vice president at CBRE.” While we have absorbed the units that are being delivered, we are still seeing record rent growth, yet Houston’s average rent is still affordable compared to other markets around the country.”
Of note in Houston:
· The city registered positive net absorption of 21,394 units—the highest figure for the period among the 50 largest U.S. markets, and the highest figure for Houston in nearly a decade.
· Apartment rents are growing at the fastest pace on record—Houston’s same-store rent index increased by 4.9 percent year-over-year and 1.4 percent quarter-over-quarter.
· Construction activity has steadily risen since the post-recession low recorded in 2011, and nearly 18,000 new units are expected by the end of 2014.
· And according to Real Capital Analytics, Houston posted $1.2 billion in multifamily sales in Q2 2014—a gain of 48 percent from Q1 2014.