Real estate
Apartment, townhome options explode in Lake Houston area with new projects
Opened since June 2023 | Units: 703 Under construction | Units: 181+ Proposed | Units: 1,803 Multifamily developments
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real estate research and planning firm Community Development Strategies. “At a very basic level, we just have to have housing for everybody that is coming here or … emerging here because they’ve been born,” Spillette said. According to MRI ApartmentData and previous Community Impact reporting, some projects that opened recently include: • Bluewater At Balmoral: a 92-unit rental townhome community that opened in April • Eleve: a 322-unit apartment complex that opened in February • The Residences at Kingwood: a 289-unit apartment complex that opened in February Monthly rent at three apartment complexes that opened in the Lake Houston area since June 2023 ranges from $1,430-$2,475, not including utility costs and other fees. According to MRI ApartmentData, the average rental rate in the Lake Houston area is about $1,362 per month as of May 31.
Lake Houston-area residents are seeing an expansion of rental options as 12 multifamily developments have either opened, are currently under construction or have been announced since June 2023. According to prior reporting and data analysts from MRI ApartmentData, three apartment complexes have opened in the Lake Houston area since February. Meanwhile, two projects are under construction and seven more have been proposed. Real estate experts said developers and investors began planning multifamily projects two or three years ago when interest rates were at record lows. Bruce McClenny, industry principal for MRI ApartmentData at MRI Real Estate Software, said because of this trend, he saw more apartment complexes open in 2023 and 2024 than he has in his entire career. The spike in multifamily housing can likely be attributed to factors such as regional population growth, job growth and nearby retail development, said Steven Spillette, president of
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SOURCES: MRI APARTMENTDATA, MCNAIR INTERESTS, FEIN, MCCORD DEVELOPMENT, FIDELIS RESIDENTIAL, BRIARSTONE DEVELOPMENT, GREYSTAR, TBD DEVELOPMENT, HIGH STREET RESIDENTIAL/COMMUNITY IMPACT
Some context
Multifamily rental rates in Lake Houston area
Lake Houston/Kingwood Houston metro area
Patrick Jankowski, chief economist and senior vice president of research for the Greater Houston Partnership, said in a May update that Houston has shifted from a landlord-friendly market to a tenant-friendly market because: • Average multifamily occupancy is below 90%. • Rental rates have fallen over the last year. • Incentives such as free rent and security deposit waivers are prominent. The Lake Houston area’s average occupancy rate dropped from about 93% in June 2022 to 88.5% this May, according to MRI ApartmentData. With 19,000 apartment units under construc- tion in the Greater Houston area and another 33,000 planned for the region as of June 1, Jankowski said supply greatly exceeds demand for multifamily housing. “An industry rule of thumb holds that Houston absorbs one apartment unit for every six jobs created,” he said in the report. “At the current pace of construction, Houston will need to create roughly 114,000 jobs to absorb what’s currently under construction.” Roughly 80,700 non-farming jobs were created in
$1,300 $1,400 $1,500
$1,382
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$1,200
$1,260
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$1,100
$1,000
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SOURCE: MRI APARTMENTDATA/COMMUNITY IMPACT
Multifamily occupancy rates in Lake Houston area
the Houston-The Woodlands-Sugar Land area from April 2023 to April 2024, according to data provided by the U.S. Bureau of Labor Statistics. As more new multifamily housing options are built, this may push older apartments to decrease rent, offer more specials or become subsidized to remain competitive, said Ty Jacobsen, a senior market and Geographic Information System analyst for CDS.
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88.5%
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87.5%
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70%
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COMMUNITYIMPACT.COM
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