There is a lot of concern about economic issues like inflation and interest rates today. Many of us are wondering how this will affect the rental market in Houston. Is a rental bust in sight? Maybe, but it looks like we will recover. Let’s look closer here:
As of right now, the state of the economy has not affected the growth of the rental climate in the US. According to the Yardi Matrix Multifamily National Report, the average rent price rose by $15 in April. While there may be slippage in the future, right now the rental climate is in good shape.Looking for a rental market update? We have you covered. Join us as we walk through the Yardi Matrix National Report for this month. Click To Tweet
Rent Growth This Year
Surprisingly, the rent growth over the last year has been holding strong during the spring season instead of dropping off as the economy would suggest. For now, the rent growth is still riding the record year we had in 2021.
Why has this rent growth happened though? Well, this year there has been a huge shortage of units available, which raised the average price of rent. This is an aftereffect of the housing market crash in 2008.
The Yardi Matrix National Report states that “Certainly, deceleration will happen, and there are warning signs on the horizon. The U.S. economy unexpectedly contracted by 1.4% in the first quarter of 2022, owing to issues that include surging inflation, ongoing supply-chain issues, shrinking business inventories, and the omicron outbreak in January.”
In the Greater Houston area alone, the forecasted rent growth is projected to go down from 11.6% to 5.3% (Yardi Matrix 7). This means a slippage is coming, it’s a natural consequence of all the hits our economy took over the last few years due to the pandemic.
Things Will Recover
The good news is that it looks like the rental market will recover. The United States has a strong job market, and an increase in consumer spending leaves us in a good place for the future. It looks like things will stabilize and become more normal as we all recover from the pandemic.
Bran Real Estate Services Is Here
To sum up, the multifamily rental climate is still in a good place because of the boom from last year. While there will be a decline over the rest of the year, things will stabilize eventually. Bran Real Estate Services is here to help you jump into the apartment rental market.
Contact us for more information on becoming a part of the rental industry.
*2022. National Multifamily Report April 2022. Yardi Matrix, pp.2-7.