The Dallas-Fort Worth apartment market continues to sizzle, with an annualized rent growth rate of 19.6% — the second strongest of the Texas markets, according to a new report.
Landlords aren’t seeing a seasonal slowdown and most expect some degree of growth to continue, according to the November Market Line report from ApartmentData.com.
Breaking it down, the North Central Expressway/Upper Greenville Avenue apartment submarket leads the way, with 32.9% annualized growth in rent.
The West Lewisville/Flower Mound and East Plano/Richardson round out the three hottest DFW submarkets of the 37 that ApartmentData tracks, with annualized growth of 27.4% and 25.1%, respectively.
Apartment occupancy across DFW stands at 93.4%
Demand remains strong across DFW, especially on the western side of the Metroplex, judging by the number of new apartments absorbed and other metrics.
Almost 44,000 units have been absorbed in the past 12 months across DFW. A total of 107 multifamily communities with more than 30,000 units have opened in the past year, according to the Market Line report.
An additional 70 communities are under construction, which will add 19,600 units to the housing stock when complete. Some 166 apartment communities are proposed for construction, totaling roughly 69,500 units in the planning/development stage.
Dallas-Fort Worth is the largest multifamily market in Texas and one of the biggest in the country, with an operating supply of 3,331 communities and about 798,000 units, according to ApartmentData.com’s tally. By comparison, Houston has a supply of about 702,000 units, Austin has roughly 264,000 apartments and San Antonio clocks in with just over 208,000 units.
Compared to other Texas markets, DFW ranks second in annual rental rate growth, trailing Austin which posted a 29.1% increase over the past 12 months in that category. Austin’s apartment occupancy is 92.7%, and the market has absorbed almost 22,600 units in the past year.
Rent rate growth in San Antonio is 16.3% for the past year. Occupancy in the Alamo City is 93.5%, and the market absorbed 11,285 units in the past year.
Houston rents have risen 14.6% in the past year. Apartment occupancy stands at 91.9% and about 36,900 units. Have been absorbed in the past 12 months, ApartmentData’s count shows.
The statistics are derived from a continuous survey of all apartment communities. Effective rental prices are calculated net of concessions and utility adjustments. Concessions are discounts such as move-in specials and months of free rent. ApartmentData.com captures the effect of these specials and prorates them over a lease term to arrive at a percentage reduction in market or street rents.
Looking at the short-term, rents in Dallas-Fort Worth increased 0.7% month-over-month in November, compared to a 0.8% increase nationally, according to another report. Month-over-month growth in Dallas ranks No. 48 among the nation’s 100 largest cities, according to ApartmentList.
Median rents in DFW stand at $1,126 for a one-bedroom apartment and $1,351 for a two-bedroom.
The national rent increase of 0.8% this month is less than half of last month’s growth rate and the smallest increase since February, ApartmentList’s November Rent Report found. Despite the slowdown, rent growth is still outpacing its pre-pandemic trend.
“While our national index continues to trend upward, 22 of the nation’s 100 largest cities saw rents fall this month, ending a six month stretch in which virtually all of these cities were experiencing uninterrupted rent growth,” the report says.
Publication: Dallas Business Journal