North Texas apartment rents increase at a record rate; average nears $1,000
Dallas-Fort Worth apartment renters this year are getting slammed with record rent increases.
“We can’t find a quarter in the past where rent increases were this high year-over-year,” said Greg Willett, MPF Research chief economist.
Even increased construction this year hasn’t put the brakes on significant apartment rent hikes.
“Such strong rent growth in Dallas-Fort Worth really is unprecedented,” Willett said. “Some slowing of rent growth is likely, but the pace of price increases should remain way above Dallas-Fort Worth’s long-term norm of 2 percent to 2.5 percent.”
An average apartment in North Texas now costs $975 per month. Rents for newly-built units in hot markets like Dallas’ Uptown district are running more than $1,500.
Net apartment leasing totaled more than 5,000 units in the third quarter.
D-FW leads the country in both apartment leasing and the number of new units added to the market.
Less than 5 percent of North Texas apartments are vacant.
Despite one of the largest construction volumes in decades, apartment builders can’t keep up with demand in the D-FW area caused by strong job growth and increasing populations.
“It’s all about job growth and new lifestyle choices,” Willett said.
More than 38,000 apartments are being built in North Texas — the highest total in decades. “There was one year back in the ’80s where it hit 50,000,” Willett said. “Every quarter lately we’ve said we are at our peak and it’s gone up more.”
While North Texas apartment rents are spiking, the increases are even stronger in some U.S. markets.
“The average for the West is around 8.5 percent,” Willett said. “There are three or four West Coast markets where rent increases are above 10 percent.
“It’s hard to make a case rent growth can stay at the pace it is now, even at full occupancy.”