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North Austin neighbor is the No. 6 best U.S. city for renters in 2024

Only five other U.S. cities are better for renters than Round Rock, a new report says.

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Austinites looking for their next apartment or house to rent should consider living in the suburb of Round Rock, which was just ranked the No. 6 best city in the nation for renters.

This is the second year in a row that Round Rock has overshadowed Austin proper — which ranked one spot behind as No. 7 — in RentCafe's "Best Cities for Renters to Live in" report. The apartment rental marketplace annually compares 150 U.S. cities based on their quality of life, local economy, and cost of living and housing opportunities.

Charleston, South Carolina, maintained its position as the No. 1 best city for renters for the second consecutive year. Rounding out the top five top rental markets are Atlanta, Georgia (No. 2), Sarasota, Florida (No. 3), McKinney, Texas (No. 4), and Scottsdale, Arizona (No. 5).

Like other suburbs that made the list, the main characteristics that made Round Rock stand out above the rest are the suburb's "small town feel" and its community-focused residents, according to RentCafe. No coincidence that it was also ranked one of the best places to live in 2023 by Fortune Magazine.

"[Round Rock] ranks third in cost of living and housing nationwide for its lower-than-average cost of living, spacious apartments and high share of newly built units — making it perfect for renters looking to stay within budget," the report said.

RentCafe ranked Round Rock No. 3 nationwide for its high-quality apartments, with the average apartment size coming out 908 square feet, roughly in the middle of all the cities. Approximately 26 percent of all apartments in the city have been built within the last five years, and the suburb's cost of living is 8.3 percent lower than the national average, the report said.

The quality of life in Round Rock earned the city No. 19 out of all 150 cities. The report didn't explain why, but the data found less than half (48.8 percent) of all apartments in the city were based in "top locations" (whatever that means). The city also fell behind for its "local economy" ranking, coming in at No. 30 nationally.

Austin also maintained its position as the No. 7 best rental market in the U.S. for the second consecutive year. The average apartment size in Austin is 864 square feet, which is 44 square feet smaller than the average apartment in Round Rock. About a quarter (23 percent) of all apartments in the city were built within the last five years, and the city's cost of living is nearly one percent lower than the national average, according to RentCafe.

Here's how Austin performed in the study's three main categories out of all 150 cities:

No. 13 – Local economy rank
No. 15 – Housing and cost of living rank
No. 17 – Quality of life rank

San Marcos tops the list for its cost of living and housing
This fast-growing college town between Austin and San Antonio ranked No. 55 overall in RentCafe's report, but took the No. 1 spot nationally in the "cost of living and housing" category.

According to the study's data, San Marcos' cost of living is 9.6 percent lower than the national average, and 21.1 percent of all apartments in the city have been built within the last five years. The average apartment size in the city is 996 square feet, which is the largest average size out of all 18 Texas cities in the report.

However, for whatever makes up for San Marcos' cost of living, the city loses in the "quality of life" category. RentCafe says San Marcos has the worst quality of life out of all U.S. cities, ranking No. 106, without much of an explanation why.

Here's how other Texas cities stacked up among the top 100 in RentCafe's report:

No. 17 – Plano (down from No. 2 in 2023)
No. 38 – Denton (down from No. 19 in 2023)
No. 52 – Midland (no data from 2023)
No. 53 – Fort Worth (down from No. 37 in 2023)
No. 57 – Dallas (down from No. 32 in 2023)
No. 58 – Lubbock (down from No. 43 in 2023)
No. 65 – San Antonio (down from No. 55 in 2023)
No. 85 – Amarillo (no data from 2023)
No. 91 – Waco (unchanged from 2023)

RentCafe used data from their sister site Yardi Matrix to determine each city's ranking based on 20 metrics, including average apartment size, the cost of living and housing, the share of renter-occupied households, renter household median income growth, and more. Cities were chosen if they had an "apartment stock" of a minimum of 10,000 units, and any cities with lower apartment stocks were excluded.

The full report can be found on rentcafe.com.

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How Austin fits into Zillow's predicted housing market growth in 2025

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Potential homebuyers in Austin may see improving mortgage rates and home prices in 2025, according to Zillow.

It looks like a few more people are about to turn their online home shopping daydreams into reality in 2025. Zillow, the famous real estate listings website, says in a press release that next year will likely bring "a gradual but bumpy decline in rates, impacting sales and price growth."

It attributes the forecast to "erratic and dramatic mortgage rate movements" throughout 2024, which will continue to affect the market. The website's housing market predictions report estimates that 2025 will see about 100,000 more sales than 2024, that home value growth will be "low and slow" at 2.2 percent, and that inventory and new listings will continue recovering from pandemic weakness.

On a local scale, Zillow's latest data shows Austin has already experienced a 3.4 percent drop in annual average home values from 2023 to 2024, which will continue fluctuating in 2025.

As of November, Zillow's home value index says the average home in the Austin metro is worth $443,995. That figure is greater than the Austin Board of Realtors' median home sales price in Austin-Round Rock-San Marcos, which came out to $435,000 last month, reflecting an estimated 2.4 percent increase for just the month of November year-over-year from 2023.

Pick the right season to buy
Potential buyers may see better opportunities for purchasing a home during the fall and winter, which is a typically slow season for home sales. Across 36 out of the 50 biggest U.S. metro areas, Zillow's heat market index showed a drop in competition from October to November.

"There's a strong sense of déjà vu on tap for 2025. We are once again expecting mortgage rates to get better gradually, and opportunities for buyers should follow, but be prepared for plenty of bumps on that path," said Zillow chief economist Skylar Olsen in the release. "Those shopping this winter have plenty of time to choose and a relatively strong position in negotiations."

Zillow suggests buyers may have the ability to negotiate "from a position of safety" during the slow winter months. This is especially true for Austin-area buyers, who only saw 10.4 percent of homes sell for more than their listing price in October. The website says buyers can take advantage of opportunities to buy contingent on inspections or repairs, and they may avoid bidding wars during this time.

"While the number of options available to shoppers today are lower than they will likely see in the spring, there's also less competition in the field," the report says. "The [national] share of homes that sold for more than list price was below 28 percent in October (the latest data available), continuing a downward trend that began in July."

Buyers will head to the Southwest
Eyes are also turning to the American Southwest as the top region for homebuyers in 2025, as 13 major metro areas – including Austin and San Antonio – are now considered “buyer’s markets” where buyers have more negotiating power than sellers.

However, this prediction depends on the gravity of falling mortgage rates. Homebuyers should also keep a close eye on mortgage rates in 2025, which could drop unpredictably like they have been for the last three weeks in a row. If the rates dip further than expected, that doesn’t bode as well for buyers.

“It is anticipated that a significant mortgage rate dip would bring more buyers than sellers back to the market, increasing competition and tilting negotiating power in favor of sellers,” Zillow says.

Small-home living is gaining traction
As Austin and other major cities are battling for more high density housing, buying trends are also leaning towards smaller (and more affordable) homes.

Zillow even goes as far to say that the “pandemic-era need” for large houses is officially a thing of the past.

"The term 'cozy' is appearing in more listing descriptions — 35 percent more in 2024 compared to 2023 — reflecting current design trends that have shifted away from cavernous open floor plans, toward contained spaces that have their own style and purpose," the report says.

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