Latest Data Shows Post-Harvey Rent Prices Driven Up by Ongoing Demand
Ever since last August, when Harvey brought historic devastation to the Greater Houston area, displacing residents and destroying homes, rent prices across the market have been inching up. According to ApartmentData.com, average rent costs in the Spring area are up 3.7 percent compared to September last year. This increase is causing buyers to seek out cheaper options for housing as 2019 approaches.
To understand the current housing market in Houston, it’s important to review key economic events in the recent past. Growth in the housing development sector stagnated as crude oil prices dropped in 2016, causing a downturn in the oil and gas sector. This meant the development market was already slow when Harvey reared its head.
Now, a year after Harvey first made landfall, housing industry experts are anticipating substantial growth in the rental apartment market. Due to the abnormally high demand for Houston-area apartment units, developers are working to secure sites and permits to construct new housing. And as supply struggles to meet the demand, rent prices for the Spring area, as an example, are expected to continue rising. Although average Houston rent prices prior to Harvey were down slightly on a year-over-year basis, they have since grown to $1,007 per month from $981 at this point last year, according to ApartmentData.com.
Even as developers begin construction projects in 2019 to meet this demand, the process will take time. This means rental prices will likely continue to go up as the demand isn’t met. However, as more units become ready for move-in, the demand will subside and return to normal, driving down the unusually high rent costs across Houston.
And while affordability is always a big part of any prospective resident’s selection process, many tenants are seeking security and peace of mind from housing that is less susceptible to flooding despite their price premiums. Prospective residents are now asking more questions about the impact from flooding on the units they seek to occupy.
Though Harvey brought devastation and heartache to Greater Houston residents, recovery is ongoing and will continue to drive construction of quality communities to help accommodate residents as they move on from a historically challenging year.