Austin’s era of falling rents may be coming to a close.
After at least 10 consecutive quarters of declines, analysts expect apartment rents in the Texas capital to flatten — and potentially start climbing again later this year. The Wall Street Journal reported that investors are already positioning for that turn, snapping up multifamily properties with the expectation that concessions will fade and rent growth will return by early 2027, if not sooner.
The shift marks a pivotal moment for a market that became the poster child of the pandemic housing boom. As companies and remote workers flooded into Austin, chasing lower taxes and lighter regulation, developers responded with a building spree. Starting in 2020, tens of thousands of units were brought to market annually, creating a glut that sent rents and home prices tumbling more sharply than in almost any other major U.S. city.
Now the pipeline is thinning. Austin is projected to complete just under 9,000 apartments this year, according to CoStar — roughly half of 2025’s total and 72 percent below the 2024 peak. Vacancy fell last year for the first time since 2021, a signal that the excess supply is finally being absorbed.
“We’re starting to turn a corner,” Brennen Degner, CEO of multifamily investor Platte Canyon Capital, told the publication. “Next, you’ll start to see rents pick up, you’ll start to see concessions burn off.”
That means landlords are dialing back the pandemic-era giveaways that became standard fare: one or two months free rent, waived parking fees and discounted applications. For renters, however, it may be the last window to lock in a deal. Realtor.com ranked Austin the nation’s most affordable rental market last fall, a stark contrast to New York and San Francisco, where rents have marched steadily higher.
The rebound is also drawing capital back into the market. Multifamily transaction volume in Austin jumped 18 percent, year-over-year, fueled in part by public REIT acquisitions, according to CoStar. Brokers told the outlet that buyers are racing to secure properties before pricing reflects renewed rent growth.
“Austin is the bellwether,” Mark Pasierb of Kingbird Investment Management told the publication, predicting other Sun Belt markets such as Nashville and Phoenix will follow once their own supply bulges clear.
The for-sale market is showing similar signs of stabilization. Pandemic-era overbuilding dented home prices, creating rare negotiating leverage for buyers relocating from pricier coastal markets. But local agents expect tighter supply and potentially lower interest rates to reignite competition within the next year.
Much hinges on Austin’s job engine, particularly entry-level tech and knowledge roles. If hiring falters, demand could soften again.
— Eric Weilbacher
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