Good news for us investors in Austin area residential real estate as what happens in the apartment market also happens for those of us who own rental houses. According to a recent article in the Austin American Statesman, the driving force behind this momentum is in part jobs. New companies seem to open every day in our area and expansions of existing companies, even out of state companies, frequently occur. Let’s not forget that Austin is still in the mix for landing Amazon HQ2. A recent headline I spotted stated that if this should occur that Austin rents will increase a $100 a month. The other part, according to the same article, is lifestyle. It seems these days that a lot of folks, especially younger ones, simply like the idea of not being tied down to any one place to live, even if it is a great place. So far this year the apartment folks have leased up 23% more units than all of last year. I suppose you have been around long enough to hear of “supply and demand”. Right now, in my opinion, we are experiencing more demand than supply, and that should translate into higher rents. Presently the apartment occupancy rate is over 93%, not quite full, but very close. Future rents will also be impacted by the every more increase in construction costs. Everything is going up, the cost of materials, the cost of land, and the cost of labor.
Rick Ebert / 1 September 18 / Austin Texas