February 2006 Rents stay Flat in Austin

Austin Rental Market 1999-2005

I’ve been getting behind on my market updates. It’s been a hot sales market and me and Sylvia have been staying very busy every day. If you read the Jan rental market update you know that rental rates in Austin fell in Jan 2006 from Jan 2005. February stats show virtually no movement from the same month last year. See the chart below.

Austin Rental Market February 2005 and 2006
Single Family Homes
Feb 2005
Feb 2006
# Homes Leased
Average List Price
Average Leased Price
Average Days on Market
Average Size (square feet)
Average Price per Square Foot (monthly)

There really isn’t anything new to say. Investors continue to supply Austin with plenty of rental homes, which keeps the rents suppressed and causes pain for cheapskate landlords who don’t properly prepare and price their homes. I don’t expect rents to go up until the investors thin out. Rising prices are starting to slow down investment activity as the sales price to rent ratio spreads further.

Austin still has great investment opportunities. But you have to buy a home that renters will be attracted to. We continue to talk a lot of investor prospects out of buying. If you can’t make at least a 20% downpayment and you don’t have cash reserves equal to 6 month’s rent to set aside after your investment purchase, we don’t think you should buy rental property in Austin. The one exception is investors who put less down not out out of necessity but to leverage themselves into more properties, and they have the cash reserves to withstand any possible bad luck.

See historical graphs below.

Austin Rental Market 1999 thru 2005

Lets look at Days on Market historically in Austin

Austin Rental Market Historical Days on Market

Posted by Steve
10 years ago

Steve is a Real Estate Blogger, Husband and Dad, UT Austin Grad, Runner, Real Estate Broker and owner of Crossland Team and Crossland Real Estate in Austin TX.

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Stephen Reed - 10 years ago

Do you have similar statistics for duplexes?

Steve - 10 years ago

I can probably do something similar for duplexes. The problem with duplexes is we don’t know the square footage per unit. Tax records provide sqft for the entire property, but we don’t know how it breaks out. Some agents leave the entire sqft in the listing, others in the past have changed it to zero, still others might try to guess the size or assume that it is half the total size if both sides are identicle units.

But we could get a rough rent number nonetheless, maybe broen out for number of bedrooms. My guess is the average Duplex rent will be in the $700/mo range citywide, but don’t quote me on that until I get a change to check it out.

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