Jun 6, 2024 - Real Estate

Houston becomes a top built-to-rent market

The bar chart displays metro areas with the most built-to-rent community single-family units completed from 2018 to 2023, with Phoenix leading the way with 9,345 units, followed by Dallas-Fort Worth with 6,512 units and Atlanta with 3,536 units.
Data: RentCafe; Note: Includes homes in professionally managed communities with at least 50 rental units; Chart: Axios Visuals

With homebuying less and less accessible, Houston has become a top built-to-rent market.

State of play: Houston ranks No. 4 among U.S. cities for new built-to-rent single-family homes completed in the past five years, with 2,402, trailing only Phoenix, Dallas and Atlanta, according to a recent RentCafe report.

Why it matters: With mortgage rates perched near record highs for the year, there has been a proliferation of those communities, which offer amenities, property management perks and no mortgages.

By the numbers: Another 4,836 built-to-rent units are underway in Houston with an expected completion date of next year, per RentCafe.

The big picture: Such developments are typically popular in the Southeast, Southwest and Sunbelt, where land costs less, but they've been slowly moving into other parts of the country.

Zoom in: Built-to-rent sections are now common in Houston, especially in the new master-planned communities, like Summerwell Sunterra in Katy, Balcara at Meridiana, a rental subdivision in Bridgeland and Everstead at Conroe.

Between the lines: Built-to-rent communities are particularly appealing to those who want more space but can't afford to buy a house, as well as empty nesters seeking less home upkeep, experts say.

Zoom out: The number of built-to-rent community houses completed nationwide jumped 75% from 2022 to 2023, reaching an all-time high of nearly 27,500 homes.

  • More than 45,400 more are now under construction, per the analysis.
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