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Market Report

Houston Multifamily Market Report

2Q 2023

Homeownership Barriers Signal Better Days Ahead;
Inbound Supply Will Challenge Westside Suburbs

Key renter cohort growth amid homebuying hurdles is bullish. The Houston metro contains nearly 1.6 million residents in the age 20- to 34-year-old bracket, the fifth-largest total among major U.S. markets. This demographic is projected to expand by an additional 100,000 individuals through 2027, ranking second to only Dallas-Fort Worth. That trend is particularly relevant for the multifamily sector amid barriers to homeownership. Houston’s median single-family home price surged by more than 35 percent over the past three years to about $340,000. Softer buyer demand in recent quarters has done little to push down home values, due to a lack of for-sale inventory. At the same time, inflation has made it difficult for young adults to save for a down payment, while taking on long-term debt amid higher borrowing costs is unappealing. As a result, many in the expanding age 20- to 34-year-old cohort will choose to rent longer into their lives, aiding multifamily performance metrics. 
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