Houston recovered all the jobs it lost during the pandemic, with the multifamily sector directly benefiting from the bounce, as fundamentals stayed healthy on the heels of a robust 2021. Rents rose 0.7 percent on a trailing three-month basis through May, to $1,293, and the overall occupancy rate in stabilized properties rose 130 basis points in the 12 months ending in April, to 94.1 percent.
Houston unemployment stood at 4.1 percent in April, according to data from the Bureau of Labor Statistics, outperforming the state (4.3 percent). Even though it lags the U.S. (3.6 percent), Dallas (3.2 percent) and Austin (2.5 percent), Houston marked a 140-basis-point improvement since the beginning of the year. Employment expanded by 5.2 percent, or 150,400 jobs, in the 12 months ending in March, 50 basis points above the U.S. The market’s largest sector—trade, transportation and utilities—added 35,300 positions and will likely continue to grow as global macroeconomic trends are indirectly favoring the area, boosting production and exports. Container volumes at Port Houston were up 20 percent year-over-year in the first quarter of 2022.
Developers delivered 5,692 units in 2022 through May and had another 23,382 units under construction. Transaction activity intensified compared to the same period last year, amounting to $4.8 billion through May, for a price per unit that rose 25 percent year-over-year, to $152,443. However, the current economic climate is likely to dampen transaction activity in the near term.