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Dallas-Fort Worth’s net apartment leasing totaled 5,465 units in the second quarter.
That sounds like a lot, but it’s not enough.
Developers completed almost 7,000 apartments in the last three months. And on an annual basis, apartment demand is lagging new supply by almost 10,000 units, according to the latest data from Richardson-based RealPage.
At the same time, developers have ramped up building to more than 37,000 apartments on the way in North Texas — more than any other metro market in the country.
No wonder apartment rents are actually falling in some parts of D-FW and area wide rents are up by some of the lowest percentages since the Great Recession.
"The flattening of rent growth on the Dallas side of the Metroplex is a key story line," said RealPage chief economist Greg Willett. "Annual change as of midyear is 1.2 percent for Dallas-Fort Worth in total, held back by 0.8 percent growth in metro Dallas."
Fort Worth area average apartment rents are 2.7 percent higher than in second quarter 2017.
But some neighborhoods that are seeing a flood of new apartments have had actually declines in asking rents this year, RealPage reports.
Average rents are down 3.7 percent in East Dallas, 3.2 percent in Rockwall-Rowlett, 1.5 percent in Frisco, 1.2 percent in Las Colinas and 1 percent in West and Central Plano. Rents are also down fractionally in central Dallas, Allen-McKinney and downtown Fort Worth
The lower rents are mostly because of deals offered in newly built rental communities, which typically offer a month’s free rent.
Renters renewing in well-leased properties may still see a small increase.
Even with the softening of the rental market, asking apartment rents across D-FW hit a record high of $1,103 in the second quarter, RealPage said.
The surge in apartment completions may be holding back rents but it so far hasn’t resulted to a big run up in vacancy rates.
"Occupancy is 94 percent, in line with the long-term norm," Willett said. "But occupancy has dropped from 95.3 percent a year ago, reflecting that demand in the past year fell about 10,000 units short of completions."
The best news for apartment builders is that there’s no sign of a slowdown in D-FW area job growth. If anything, North Texas employment gains are growing.
As of May, there were 122,000 more jobs in the D-FW area than in May 2017, according to the U.S. Bureau of Labor Statistics.
Most of those new jobs are being filled by people moving to North Texas who are filling up thousands of new apartments and homes.