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Homebuyers aren’t the only ones who have been slammed with soaring prices in the last few years.
Dallas-area apartment residents have also endured several years of significant price increases.
But just as home-price growth in North Texas is slowing, increases in apartment rents are also starting to wane.
During the third quarter, the Dallas area’s average apartment rents rose at only 1.3 percent from a year earlier, according to new data from Richardson-based RealPage. That’s less than half the annual rent growth among the major U.S. cities surveyed by RealPage.
The slowdown in Dallas apartment rent increases isn’t a surprise. With almost 28,000 new apartment units hitting the North Texas market this year, analysts are tracking a steady decline in percentage rent hikes.
"We are about to move into the period of seasonally slow apartment leasing that comes with the cold weather months," RealPage chief economist Greg Willett said in the report. "Demand will trail completions just ahead, making it tough for the rent-growth pace to gain additional traction."
Dallas was on RealPage lists of the major U.S. rental markets that saw the weakest apartment-rent growth in the third quarter.
The fastest growing apartment rents were in Las Vegas (up 6.6 percent year-over-year) and Orlando, Fla. (up 6.5 percent). Houston-area rents were 3.7 percent higher than in third quarter 2017, according to RealPage.
Overall, North Texas apartment rents are still up by more than a third since 2010.
The average Dallas-Fort Worth-area apartment rent is at a record of more than $1,100 a month.
Still, the rate of rent increases in the area is just a fraction of what it was a couple of years ago, when landlords were bumping up their prices by more than 5 percent a year.
With more than 35,000 units still under construction, D-FW is one of the country’s top apartment-building markets. And only less than 5 percent of the local apartment market is vacant.
Net apartment leasing in the D-FW area totaled more than 8,500 units in the third quarter — the best quarterly performance in more than a year.
"There was a little bit of an upward shift in momentum than we have been seeing," Willett said. "We still have a whole lot under construction.
"If we hit a bump in the road in the economy, that makes it a challenging environment."
Even with lower rent increases, there’s no sign developers are cutting back on apartment building in North Texas.
"You look at the building permit numbers and start the numbers and there is still no indication of that," Willett said.
Apartment rent increases nationwide are slowing.
Annual rent appreciation was unchanged in August for the first time in 12 years, according to a recent report by Zillow.
Zillow estimated that Dallas-area rents were actually down 0.3 percent in August from a year earlier.
"Slower rent growth means that renters may feel less urgency to buy," said Zillow Senior Economist Aaron Terrazas.