Public Insight Network

New Apartment Construction Brings No Relief On Rents

The rent for a typical urban apartment in Houston is now rising between 5% to 10% a year. That's roughly two to four times the national average. KUHF Business News Reporter Andrew Schneider looks at why it's getting so tough to find an affordable apartment.

Cecilia Marquez sits outside the Black Hole Coffee Shop in Montrose. A retail consultant, Marquez has long since outgrown her nearby apartment, which doubles as her home office. She and her boyfriend have been looking for a new place for more than a year.

“Three years ago, you could find a pretty good sized 1 or 2 bedroom apartment for $1,200, $1,100. We have two dogs, which makes it a little bit tougher. These days, we are seeing studio apartments that are going for those prices, and 1 and 2 bedrooms that are going for $1,800 and $2,000, and nobody’s allowing dogs anymore, because they don’t have to.”

Montrose is a hot neighborhood for young professionals. But Marquez’s story is one with echoes all over Houston. 

The simple explanation for why rents are rising so fast is that demand is outstripping supply. Tens of thousands of new residents are pouring into Houston each year, drawn by the city’s blistering job market. Three years after the housing crash, credit remains tight, so many decide to rent until they can afford to buy. And they find themselves competing with long-time residents like Marquez who are in the same boat.

Demand this fierce should spark new construction, and that’s what’s happening here. But only up to a point. Bruce McClenny is president of Apartment Data Services.

“We’re going to build and deliver about 13,000 units this year, and maybe another 12,000-13,000 next year, and for a city that has such job growth, that type of unit growth is probably not enough.”

Part of the problem is that, like would-be homebuyers, developers are having a tough time obtaining financing. Most projects getting the green light are like this one — Avenue R, a luxury apartment complex going up near the Galleria.

Scott Sherrill is head of marketing and research development at O’Connor & Associates.

“You’ve got a lot of people willing to pay high rents, which is a goldmine for apartment developers, and they’re going to go straight for the Class As.”

That’s leading many owners to demolish older, more affordable rental properties to make way for Class A structures. When that happens, tenants have little recourse. Tenants like Cecilia Marquez, who just learned her building is up for sale.

“That definitely made our search a little bit more urgent. It’s been frustrating. I’ve had a few screaming meltdowns, and I’ve threatened to move back in with my parents if I can’t find anything.”

Marquez says she’s looking in other neighborhoods. But she’s finding the rents are just as high and the inventory just as low. Instead of broadening her reach, she says, she’s just broadened her competition.


Some people interviewed in this report were drawn from the Public Insight Network, where listeners like yourself have signed up to be a resource for quality journalism. If you want to share your stories or expertise on a particular subject, sign up at

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Andrew Schneider

Andrew Schneider

Politics and Government Reporter

Andrew heads Houston Public Media’s coverage of national, state, and local elections. He also reports on major policy issues before the Texas Legislature and county and city governments across Greater Houston. Before taking up his current post, Andrew spent five years as Houston Public Media’s business reporter, covering the oil...

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