Austin rents are still high, for now
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In the fourth quarter of 2022, the average asking rent in Austin was $1,585, up 8.6% from a year earlier, per economic research firm Moody's Analytics.
Why it matters: Affordability concerns are starting to weigh down the booming rental market.
What's happening: Many would-be homebuyers chose to rent longer last year, sustaining apartment demand, according to economists at Moody's Analytics. But folks are hitting their spending limit.
- For the first time in over two decades, households now have to spend 30% of their income on average rents, a new report shares.
What they're saying: Year-over-year rent growth slowed in the second half of the year across the board, "and we expect further deceleration as new supply makes it to market at the same time the labor market softens," Moody's Analytics senior economist Lu Chen tells Axios.
Of note: While renting in Austin remains cheaper than monthly payments on a home, Central Texas' housing market began shifting toward buyers in 2022, according to the year-end Central Texas Housing Market Report released by the Austin Board of Realtors.
- Home sales dipped 18.3% to 33,547 homes sold last year and inventory rose, with homes on the market for an average of 31 days — 11 days more than in 2021.
What we're watching: New apartment construction. The expected surge in supply could help bring down prices.
Yes, but: Experts say most cities will "remain undersupplied with the kind of affordable units that see the highest demand," per The Wall Street Journal.