Photo courtesy of Jujutacular via Wikimedia, CC BY-SA 3.0
It may be the middle of winter, but the Houston rental market is scorching hot. Data from RentJungle.com shows the average price of a Houston apartment has increased approximately 35 percent since 2009 to an average of $1,330 per month. A recent study conducted by Harvard University suggests we have a strong job market and declining multi-family unit construction rates may account for the sharp price increase. Here’s a look at the most popular rental neighborhoods in Houston – and what renters can expect.
According to the Houston Chronicle, neighborhoods in the Inner Loop have posted some of the biggest price increases, as rents have increased by an average of about $200 compared to a couple of years ago. The resiliency of the Houston job market has attracted thousands of newcomers in search of prime locations near their jobs, increasing the density and rents in Houston’s central business district.
In neighborhoods such as The Heights, for example, that translates to an average rent of about $1,000 per bedroom, according to Trulia.com. Located nearly adjacent to downtown Houston (but miles away in charm), The Heights’ unique mix of Victorian homes, bungalows, quirky boutiques and restaurants provides a colorful backdrop for urban dwellers and offers unique rental options.
Still, there are some drawbacks for Heights renters, says Adriana Galicia, a senior manager at Venterra Realty in Houston.
“Heights units tend to be older and smaller; plus, there are fewer amenities in the apartment complexes. But the short commutes to work and loveliness of the neighborhood means there’s always demand,” she says.
The Montrose/Neartown neighborhood offers a similar mix of proximity to downtown work spaces, urban street life and charming architecture. Unsurprisingly, its rents, too, have soared in recent years, and today average approximately $1,100-$1,300 per bedroom, according to Trulia.com. (Upper Kirby is the most expensive part of the neighborhood, averaging over $1,300 per bedroom.)
Unlike The Heights, however, this area has seen a greater amount of multi-family residence construction in recent years. Although historical homes and apartments are plentiful, there has been a surge in construction of (higher-priced) new units in recent years, says Galicia. Perhaps because Montrose/Neartown enjoy more nightlife and shopping options, the demographic tends to skew younger than The Heights.
Hanley Woods’ Metro Study highlights Houston’s continued job growth potential, especially in industries such as energy, as a reason for the uptick in rents across our metro area. Outer Loop neighborhoods with major employer presences – such as the Energy Corridor – are also seeing steady increases in rental prices. Although Trulia indicates an average rent of approximately $700-800 per bedroom in the Energy Corridor (or about 30 percent lower than its Inner Loop counterparts), the same basic principles apply: Renters are flocking to this neighborhood for proximity to work at major area employers like BP and CITGO, along with the convenience to dining and entertainment options at nearby City Centre and Memorial City.
So long as energy prices remain high (benefiting the city’s strong energy industry) and unemployment in the area relatively low, according to the Hanley Woods study, the increase in rental prices is unlikely to stop.