Like the temperature, demand for rental homes across Greater Houston soared in July, reflecting a continued quest for alternate housing amid lingering concerns about affordability and interest rates. Rentals of single-family homes reached an historic high, however townhomes and condominiums were also in demand.
According to the Houston Association of Realtors’ (HAR’s) July 2023 Rental Market Update, leases of single-family homes jumped 19.0 percent year-over-year with the average lease price climbing 3.0 percent to $2,363 – a record high. A total of 4,396 leases were signed compared to 3,693 in July 2022. That is the highest volume of single-family leasing ever recorded.
New listings of single-family rentals rose 11.6 percent in July, providing a sufficient supply of homes to meet the escalating demand. Days on Market, or the actual number of days it took to lease a home, rose from 20 to 28 days.
“Rental homes remain hot property in Houston as prospective buyers continue to take a wait-and-see approach to a home purchase, with ongoing concerns about affordability and interest rates,” said HAR Chair Cathy Treviño with LPT, Realty. “A rental home gives consumers the look and feel of homeownership without the mortgage obligation, and more importantly, it provides them with critical housing until they consider market conditions suitable to buy.”
The townhome/condominium rental market also held to positive territory in July. Leases of those properties climbed 3.9 percent with 716 units leased compared to 689 last year. The average lease price rose 2.0 percent to $1,963 – down from last month’s record high of $2,048. New listings increased 3.9 percent and Days on Market went from 24 to 32 days.
Pre-pandemic Perspective: Compared to the last July before the pandemic, single-family home rentals are up 12.1 percent. In July 2019, leases were signed for 3,923 single-family homes. The average rent is currently 24.0 percent higher than it was back then – $1,905. Townhome/condominium rentals totaled 780 in July 2019. That is 8.9 percent above the July 2023 volume. The average townhome/condo rent is currently 18.5 percent above its July 2019 price of $1,657.
HAR’s Rental Market Update is distributed on the third Wednesday of each month, one week after the release of the monthly Home Sales Market Update. An archive of all these reports is available in the HAR Online Newsroom.
