Demand For Multifamily Rental Units Lagging

CORPUS CHRISTI, TX-Despite a strong local employment market that is bolstered by the oil and gas sector as well as the military, Corpus Christi’s multifamily housing market is lagging, says a report by Hendricks & Partners. The third quarter of 2001 saw the absorption of only 89 units as compared to the 196 units absorbed at the same time one year ago.

Absorption for the year is currently at a negative-164 units. Hendricks & Partners report no new multifamily permits have been issued and no units came on line in the third quarter showing the decline of development for that product type.

While the overall vacancy rate is 4.7%, up from 4.1% at the same time last year, certain submarkets of Corpus Christi are faring better than others. Laredo and the Northwest submarkets have the lowest vacancy rates at 3.4% and 3.6%. The Alice/Robstown/Kingsville has a whopping 11.4% vacancy rate because of high vacancies in properties built before 1970, notes the report.

Rents increases are down across the Corpus Christi market. Average rents went from $532 in September of 2000 to a mere $541 in September 2001. This represents a 1.7% rent gain, down from the 2.9% gain enjoyed one year ago.