Single-family home rentals staged another solid performance in October as elevated mortgage rates convinced many would-be buyers across Greater Houston to shift to the leasing segment.
According to the Houston Association of Realtors’ (HAR’s) October 2023 Rental Market Update, rentals of single-family homes rose 4.3 percent year-over-year with the average lease price edging up 2.2 percent to $2,231. A total of 3,254 leases were signed compared to 3,119 in October 2022.
New listings of single-family rentals climbed 9.8 percent in October, providing an ample supply of homes to meet the ongoing demand. Days on Market, or the actual number of days it took to lease a home, increased slightly from 29 to 32 days.
“Homes for lease remain a big draw for consumers who are unwilling to make a purchase with mortgage rates sitting where they are right now,” said HAR Chair Cathy Treviño with LPT, Realty. “Single-family leases have been strong throughout 2023 while townhome and condominium leases have been less consistent. Despite the easing of home prices and growth in inventory in recent months, some consumers may continue to hold off purchasing until they see mortgage rates come down.”
The townhome/condominium rental market slowed in October. Leases of those properties were statistically flat with 523 units leased compared to 521 last year. The average lease price edged up 0.7 percent to $1,913. New listings rose 9.1 percent and Days on Market went from 33 to 37 days.
Pre-pandemic Perspective: Compared to the last October before the pandemic, single-family home rentals are up 13.1 percent. In October 2019, leases were signed for 2,877 single-family homes. The average rent is currently 24.2 percent higher than it was back then – $1,796. Townhome/condominium rentals totaled 500 in October 2019. That is 4.4 percent below the October 2023 level. The average townhome/condo rent is currently 24.1 percent above its October 2019 price of $1,541.
HAR’s Rental Market Update is distributed on the third Wednesday of each month, one week after the release of the monthly Home Sales Market Update. An archive of all these reports is available in the HAR Online Newsroom.