Market Report
Houston Multifamily Market Report
1Q 2026
Performance Split as Urban Pipeline
Contracts and Suburban Growth Holds Steady
Local fundamentals begin to diverge. Rent growth was evident across much of Houston in late 2025, with outer-ring hubs such as Conroe, Baytown, and Galveston continuing to post consistent gains. Urban core areas — where average monthly rents exceed $2,000, and vacancy rates hover near 5 percent — also held firm. Going forward, rents should continue to improve even as household formation slows. Houston’s construction pipeline is set to further contract, with completions in 2026 falling to the lowest level since 2013. The slowdown is most pronounced inside the Interstate 610 Loop, where deliveries will equal just 10 percent of the 2025 total. In contrast, suburban development remains active. High-growth areas, such as Katy, Sugar Land-Stafford, and Northwest Houston along Highway 249, will face the most notable supply headwinds. While this wave of suburban deliveries and late-2025 vacancy upticks may weigh on property performance, overall availability well below the metro’s long-term mean points to healthy demand.
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