Austin Multifamily Market Report

Growing millennial and Gen Z populations backstop demand. Similar to last year, an incoming supply wave will place upward pressure on vacancy as new units are added at an elevated pace. In 2023, the metro is set to record its highest year-over-year inventory change since at least 2000. This increase in available units will create near-term pressure on vacancy, raising the rate from record lows reached in the first half of 2022. Austin is also expected to note the greatest pace of population growth among all major U.S. markets in 2023. The age 20 to 34 cohort makes up a significant portion of this gain. Given that younger people are historically predisposed to renting — a preference strengthened by Austin’s heightened homeownership costs — this expanding residential group will likely stay in the renter pool for longer, aiding property performance long-term and validating the ample construction pipeline. Total net absorption in Austin will still be higher than most other major markets in 2023.