In the Austin area, the “rent is too damn high” refrain promises to grow a bit louder over the next few years. Axiometrics, which provides data about apartments and student housing, predicts average apartment rents in the region will rise 11 percent from 2017 to 2020, climbing to nearly $1,400 a month.
This year, Axiometrics expects the average apartment rent in the Austin area to reach $1,239 a month, up 4.2 percent from $1,189 a month in 2016. Just three years from now, in 2020, Axiometrics forecasts the average rent will hit $1,376 a month.
KC Sanjay, senior real estate economist at Axiometrics, says the projected rise in Austin rents is tied to job growth, population growth, and a tight supply of apartments.
Another driver of the hike in rental rates, Sanjay says, will be a softening in Austin of the renter-to-owner shift over the next several years, especially in 2019 and 2020. Why? Sanjay cites a jump in mortgage rates, “robust” growth in home prices due to a lack of supply, and the nagging debt of would-be homebuyers.
“After an underperforming 2016, Austin rent growth during the 2017-2020 forecast period should return to the strong levels seen during most of this decade,” Sanjay says.
Here are the average Austin rents (estimated and projected) for 2016 through 2020, according to Axiometrics:
- 2016 — $1,189
- 2017 — $1,239
- 2018 — $1,271
- 2019 — $1,315
- 2020 — $1,376