Austin Rental Market – Nov 2006 Update

by Steve Crossland, REALTOR in Austin TX on December 13, 2006 · 3 comments

The Austin Rental Market for single family homes continues to show modest gains over a year ago. As you can see on the graph below, 2006 looks like it will be the year when rent values in Austin finally took a turn upward after falling for 4 years in a row.

Austin Rental Market - Nov 2006 YTD

See below for more charts and the complete update. This month I’ve added a new column to the MLS Area breakout of YTD Leasing stats. More on that below.


The number of homes leased through the Austin MLS is up 18% from the same time last year (559 homes Nov 2006 compared to 473 homes Nov 2005). Year to Date, the number of homes leased is up 37%, from 5448 in 2005 to 7455 in 2006. The market is showing a strong ability to absorb all of the new inventory created by investors, but the additional supply is causing rent values to rebound much slower than they would otherwise.

The Average Leased Price is up 1% both in Nov and for 2006 YTD. Not impressive, but it’s the direction of the movement that is most important after the past 4 year slide. In other words, 1% sounds unimpressive but it’s good news for landlords because of the change in direction it represents.

Austin Leasing Stats November 2006
Previous Month and Year Comparison
All MLS Areas - Houses Only

 
Oct 2006
Nov 2006
Nov 2005
Yr % Change
# Leased
610
559
473
+18%
Avg List Price
$1271
$1240
$1230
+1%
Median List Price
$1150
$1150
$1150
0
Avg Leased Price
$1257
$1230
$1216
+1%
Med Leased Price
$1150
$1150
$1125
+2%
Avg Size SQFT
1872
1858
1849
0
Median SQFT
1775
1748
1764
-1%
Avg $ per SQFT
$0.67
$0.66
$0.66
0
Avg Days on Mkt
52
55
62
-11%
Median Days on Mkt
45
43
52
-17%

Austin Leasing Stats November 2006
Year to Date Previous Year Comparison
All MLS Areas - Houses Only

 
YTD Nov
2006
YTD Nov 2005
Yr % Change
# Leased
7455
5448
+37%
Avg List Price
$1268
$1254
+1%
Median List Price
$1150
$1150
0
Avg Leased Price
$1257
$1241
+1%
Med Leased Price
$1150
$1150
0
Avg Size SQFT
1848
1806
+2%
Median SQFT
1750
1700
+3%
Avg $ per SQFT
$0.72
$0.69
+4%
Avg Days on Mkt
54
60
-10%
Median Days on Mkt
43
48
-10%

On the chart below, I’ve added new columns with figures from 2005 for Number Leased and Average Leased Price. This is so you can see an indication of which MLS Areas of Austin are showing stronger or weaker rental market activity.

For example, Hutto (area HU), where we discourage investors from buying shows a 4% drop in rental values from YTD last year. If you look at the number of units rented, it has increased 52% over last year. The average year built of a rental home in Hutto is 2004. Clearly, a lot of investors have been and continue to buy new homes in Hutto.

The number of homes rented in East Austin Area 5 has increased 100% over YTD last year, but that area has managed to eek out a 1% gain (rounded up). Area 1B, which is Central/West Austin has actually rented fewer homes this year than last, and the average rents have increased 10% over last year.

I’ve highlighted in red all of the areas that have dropped in average rent values from last year. You’ll notice that all of these areas either show an average year built of 2000 or newer, and/or are areas that are further away or on the outskirts of Austin. This is why we try to keep our investors from succumbing to the temptation to buy these cheapo starter homes out in the flat farmland areas east of Austin. The numbers look better on paper, but it’s only new the first time you rent it – after that it’s just another cheaply built home among a sea of others in a neighborhood oversold to investors.

The one exception is Area 9, which is a close-in area of South East Austin. I think this may be a sleeper area and I’m not sure why rents are down. I own a duplex over there with a great downtown view and I’ve always liked this area for it’s location. The soil is bad in that part of Austin and there are a lot of homes built in the 60’s and 70’s with bad (or weak) slabs. Talk to Centex House Levelling or any other foundation repair company and they can tell you they’ve worked on many homes in that part of Austin. Nevertheless, like the hotter “East Austin” on the other side of Town Lake, I think this area might start to get noticed more in coming years, especially the section south of Riverside and north of Ben White.

Anyway, see the stats below and feel free post any questions or observations. I’ve left blank some of the areas with little or no leasing activity.

Austin Leasing Stats November 2006 Year-to-Date
by MLS Areas- Houses Only

MLS Area
# Leased
Avg $
Leased
%Chg
Avg
SQFT

Avg $
Per
SQFT

Avg
Days
Avg Yr Built
2005
2006
2005
2006
Area 1A
32
23
$2049
$2119
+3%
2248
$0.94
50
1977
Area 1B
189
175
$1681
$1857
+10%
1580
$1.18
44
1947
Area 1N
157
177
$1266
$1373
+9%
1842
$0.75
44
1983
Area 2
118
138
$1046
$1155
+10%
1219
$0.95
37
1957
Area 2N
108
120
$1012
$1067
+5%
1449
$0.74
57
1975
Area 3
129
158
$1101
$1122
+2%
1386
$0.81
54
1962
Area 3E
21
59
$978
$1069
+9%
1439
$0.74
65
1994
Area 4
122
154
$1440
$1548
+8%
1373
$1.13
55
1955
Area 5
71
142
$1001
$1007
+1%
1210
$0.83
57
1968
Area 5E
37
62
$1034
$1014
-2%
1673
$0.61
70
2002
Area 6
67
101
$1358
$1386
+2%
1259
$1.10
41
1953
Area 7
35
28
$1454
$1572
+8%
1439
$1.09
37
1957
Area 8E
37
36
$2472
$2739
+11%
2460
$1.11
34
1979
Area 8W
84
86
$2107
$2169
+3%
2508
$0.85
42
1990
Area 9
23
18
$1130
$1112
-2%
1390
$0.80
39
1976
Area 10
419
553
$1086
$1144
+5%
1534
$0.75
43
1986
Area 11
78
120
$980
$993
+1%
1447
$0.69
58
1989
Area BA
67
71
$995
$978
-2%
1635
$0.60
40
1986
Area BL
-
-
-
-
-
-
-
-
-
Area BU
-
-
-
-
-
-
-
-
-
Area BW
9
14
$1018
$982
-4%
1572
$0.62
54
1987
Area CC
-
-
-
-
-
-
-
-
-
Area CL
668
906
$1129
$1172
+4%
1994
$0.59
53
2000
Area EL
11
18
$963
$1030
+7%
1872
$0.55
75
2001
Area FC
-
-
-
-
-
-
-
-
-
Area GP
-
-
-
-
-
-
-
-
-
Area GT
109
152
$1168
$1179
+1%
1857
$0.63
52
1995
Area HD
37
80
$1514
$1649
+9%
2217
$0.74
61
1998
Area HH
271
385
$1085
$1079
-1%
1821
$0.59
54
2003
Area HS
20
8
$1086
$1114
+3%
1769
$0.63
92
2002
Area HU
161
245
$1068
$1032
-4%
1887
$0.55
69
2004
Area HW
27
27
$1120
$1263
+13%
1772
$0.71
89
1993
Area JA
-
-
-
-
-
-
-
-
-
Area LC
-
-
-
-
-
-
-
-
-
Area LH
-
-
-
-
-
-
-
-
-
Area LL
-
-
-
-
-
-
-
-
-
Area LN
55
77
$1261
$1249
-1%
1679
$0.74
61
1986
Area LS
160
175
$1681
$1755
+4%
2142
$0.82
55
1993
Area MA
92
126
$1112
$1040
-6%
1820
$0.57
78
2004
Area MC
-
-
-
-
-
-
-
-
-
Area N
142
165
$1167
$1180
+1%
1729
$0.68
48
1990
Area NE
89
188
$1062
$1142
+8%
1812
$0.63
56
1997
Area NW
214
241
$1195
$1276
+7%
1914
$0.67
49
1986
Area PF
417
580
$1177
$1145
-3%
1941
$0.59
63
2000
Area RN
50
109
$2317
$2318
0%
2879
$0.81
54
2001
Area RR
708
1148
$1176
$1184
+1%
2024
$0.58
58
1999
Area SC
16
42
$1299
$1213
-7%
2087
$0.58
56
2000
Area SE
31
60
$1042
$1053
+1%
1858
$0.57
71
2001
Area SV
-
-
-
-
-
-
-
-
-
Area SW
292
391
$1474
$1480
0%
2139
$0.69
46
1995
Area TC
8
15
$842
$817
-3%
1451
64
1975
Area W
52
60
$1660
$1697
+2%
2083
58
1988
Area WE
-
-
-
-
-
-
-
-
-
Area WW
-
-
-
-
-
-
-
-
-

Austin MLS Map

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The data relating to real estate for sale on this web site comes in part from the Austin/Central Texas Realty Information Service (ACTRIS).

 

Disclaimer: All information deemed reliable but not guaranteed and should be independently verified. All properties are subject to prior sale, change or withdrawal. Neither listing broker(s) nor Crossland Real Estate shall be responsible for any typographical errors, misinformation, misprints and shall be held totally harmless.