As rents rise in United States’ coastal cities, people are flocking to the center of the country. Out of the nation’s 25 largest cities, Dallas finds itself in the middle for rent growth, as well.
According to an Apartment List report released earlier this month, Dallas experienced a 1.1-percent rent increase over last year. That put Dallas at No. 13 on the list of 25 cities.
The rate of rent increase in Dallas has been on a decline since 2016, when the rate was 5.4 percent. The growth rate has decreased by 4.3 percent in three years, while the national rate has decreased by 1.7 percent in the same period.
Sydney Bennet, senior research associate at Apartment List, said the stability and the slowing growth rate in rent is due to Dallas’ strong local economy.
“Despite continued population growth, new rental stock coming on the market is helping to temper rent increases,” Bennet said. “We cannot put a figure on future rent growth, but expect rent growth to continue at a slower rate than its peak in 2016.”
Developers have added about 6,532 new multifamily rental units so far in 2018, according to CBRE U.S. Research Team, which estimates by the end of this year, the DFW market will be supplied with about 28,000 total units — up 2.8 percent from last year.
“Dallas had the third highest per capita multifamily spending of the largest 25 metros,” Bennet said.
Rent increases have also been slowing down also due to renewed confidence among homebuyers across the nation. Home buying and construction had weakened during and after the subprime mortgage crisis of the late 2000s, but trends have started to restore and mimic the pre-recession period.
Bennet said as more people are buying new houses, the demand for rental apartments is decreasing. And as a result, the cost of renting apartments would also reduce.