Texas Markets Lead Q2 Apartment Demand
Texas markets made up three out of the top four U.S. markets for apartment demand in the second quarter, leading a national demand surge, according to RealPage Market Analytics.
The Dallas market ranked first nationally, absorbing 9,741 apartment units in the second quarter, followed by Austin with 8,164 units. Houston came in fourth, with tenants taking 6,835 units, according to the report.
Overall, more than 161,700 apartment units were soaked up across the nation in Q2, the best quarterly performance for absorption since the pandemic-fueled demand surge in 2021, according to RealPage. All of the nation’s 50 largest apartment markets observed positive takeup during Q2, the report states.
The leading markets also had the highest level of deliveries, according to the report. Nearly 40,000 units hit the DFW market over the past year, a 50-year high. Another 32,000 are expected before the year is over, the most of any major metro, Bisnow previously reported.
Dallas’ quarterly demand exceeded the annual demand for 38 out of the 50 largest apartment markets, RealPage reported.
But absorption isn't everything.
Despite tenants leasing lots of units, Austin has been coping with oversupply that is expected to last through this year, RE Journals reported. Austin saw more than 20,000 units completed in 2023, a record-breaking year. Another 20,000 are expected to be completed this year before a slowdown in 2025, CoStar reported.
Houston will see about 21,500 apartments deliver this year, according to Berkadia data. This will be the largest number of single-year deliveries since 2017, The Real Deal reported.
The Phoenix metro ranked third on RealPage’s report with 7,125 units taken up during the quarter.
Dallas and Houston were the only markets that saw more than 20,000 units absorbed in the past year, with tenants taking up 21,322 and 20,046, respectively, per RealPage. Austin and Phoenix both saw about 17,000 units secured by tenants in the past year, according to the report.
The South made up 60% of the nation’s apartment demand in the second quarter despite only having 42% of the stock, RealPage reported. About 226,000 units were absorbed in the South region over the past year, according to the report.
