HOUSTON, TX - If you build it, they will come. But they might not pay as much rent on it.
You don't have to be a realtor to realize there's a lot of new residential property popping up all over Houston. Bruce McClenny, president of "Apartment Data Services" says, "Presently we have about 20 thousand units that have been delivered over the last 12 months, and there's another 26 thousand units we'll deliver in the next 18. So that's a little bit higher than the normal average that we've seen over the years of about 12 to 13 thousand units a year." But with so much supply soon becoming available, many housing analysts are saying Houston's apartment boom is about to burst!
McClenny says, "With a down turn in the job growth and with the price of oil going down, there's probably fewer people looking for apartments. So the apartments are a little anxious to get the renters in so we're starting to see some discounting concessions at these new properties."
Sounds like it's all just the ebb and flow of the real estate market. What goes around comes around, and what's coming around again is older property! According to McClenny, "Those properties built-in the 70's, 80's and 90's are raising rents. We're starting to see rent increases go up there to the tune of 5 to 6%."
Because there's so much "new" getting built, supply of older apartments is going down. That means if you're looking for a cheap crib, you soon might be shelling out some more cash. But if you're in the market for new property, you might be able to soon get more bang for your buck.