Dallas-Fort Worth rent hikes appear to be easing — for now

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Rents in Dallas fell 0.1% month-over-month in September, but the Dallas-Fort Worth apartment market’s 92.9% occupancy rate leads major metropolitan areas in the state.

DALLAS— This article originally appeared in the Dallas Business Journala news content partner of the WFAA.

Rental rates in the Dallas-Fort Worth apartment market are slowing after soaring during the pandemic — but at least one forecast calls for more double-digit percentage increases in the coming year.

For now, rent growth is slowing for the season in North Texas and across the country — a welcome sign for apartment hunters who have struggled with rapid price increases throughout the pandemic.

Rents in Dallas fell 0.1% month-over-month in September, from 0.2% decrease nationwide, according to the list of apartments. Dallas’ month-over-month growth ranked 33rd among the nation’s 100 largest cities. The national median drop in September was the first monthly decline since last December.

Year-over-year rent growth in Dallas proper currently stands at 12.3%, up from 13.9% at the same time last year. Year-over-year growth in Dallas ranks 11th among the nation’s 100 largest cities, according to Apartment List, and rents in the city have risen 25.3% since the pandemic began in March 2020.

Median rents in the city of Dallas are $1,244 for a one-bedroom apartment and $1,487 for a two-bedroom.

Dallas’ year-over-year rent growth topped the state average of 8.3%, as well as the national average of 7.5%.

In all of North Texas, Plano rents are the highest, with a median of $2,010 per month for a two-bedroom apartment. The best deals are in Fort Worth and Arlington, with median rents of $1,350 and $1,340, respectively, for a two-bedroom apartment, according to Apartment List.

Elsewhere in Texas, rents have risen 8.3% in Austin, 7.8% in San Antonio and 4.7% in Houston over the past year.

A rental boom in the suburbs

List of apartments found in a separate report that major metro suburbs notably experienced faster growth in rents than the town centers they surround.

That’s true nationally and in Dallas-Fort Worth.

Since the start of the pandemic in March 2020 through today, Dallas city rents have increased 25.3%, while DFW suburbs have seen rents increase 28.4%.

Nationally since March 2020, rents have increased by an average of 19.8% in the downtown areas of major metros, while the suburbs of these metros have seen rents climb by 27.2%.

The shift to remote working has made office proximity less of a concern for housing choice, Rob Warnock, senior research associate at Apartment List, said in an email to the Dallas Business Journal.

“Over the past two and a half years, the rental market has been on a rollercoaster ride as the pandemic has upended the ways we live and work,” Warnock said.

Of the 39 US metro apartment listings analyzed, 33 saw higher suburban rent growth than central cities. On average, rent growth has been fastest in the suburbs furthest from the urban core.

Higher rents to come?

Going forward, rents in Dallas-Fort Worth are expected to rise about 11%, according to a new report from real estate data firm Yardi Systems. That’s more than any other major market in Texas.

Yardi points to relatively low supply, with less than 4% of the North Texas apartment market vacant, and strong demand for rental units due to the influx of people moving into DFW.

Apartment occupancy appears to have plateaued in DFW, according to ApartmentData.com’s October Market Line report.

With an occupancy rate of 92.9%, the Dallas-Fort Worth apartment market leads the state’s major metropolitan areas.

Occupancy in the Houston area stands at 91%, and the San Antonio and Austin areas are currently at 91.9%.

In a recent analysis of the Texas market, ApartmentData.com President Bruce McClenny noted that “2023 is shaping up to be a year where the apartment could be considered a win.”

Says McClenny in the analysis: “Recall that 2021 was a year that went through at least three years of growth.”

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