Houston Multifamily Market Report | Q2 2023

HOUSTON - Aug. 8, 2023 - PRLog -- "The Houston Multifamily market during the second quarter showed signs of stabilization. Occupancy rates remain unchanged from previous quarter, with rental rates staying relatively flat over the past year. Investment activity noticeably increased from Q1 to Q2, however, the cost of capital continues to be the main driver hindering investment activity. The light at the end of the interest rate hike tunnel looks to be glowing brighter signaling clarity for investors in the coming quarters."

Danny Rice | President

Key Takeaways

• Net absorption tripled from the previous quarter, with reported improvement in all classes
• Average rents rose 1.1% from the previous quarter and 2.2% year-over-year
• Occupancy stabilized in second quarter but decreased during the past year

Houston Highlights

Demand for multifamily housing intensified during the second quarter, with Class A properties reporting positive absorption of 4,771 units, a 78.0% leap from the previous quarter. Increased demand was seen across all classes, with the three other classes reporting improved yet negative absorption. The average monthly rent for multifamily units marginally rose 1.1% to $1,280 per month in Q2 2023. The construction pipeline also increased with 22,555 units under construction and 29,285 units proposed. At 89.5%, occupancy stabilized during the quarter, maintaining the same Q1 rate with 5,222 units being delivered.

Market Fundamentals

Houston's overall occupancy rate decreased 160 basis points over the year. The average monthly rent rose 2.2% annually from $1,252 in Q2 2022 to $1,280 in Q2 2023.

Read the full article here: https://www.colliers.com/en/research/houston/q2-2023-hous...