Renters feel squeeze as market explodes

(KXAN) AUSTIN - A decrease in construction and influx of new home and apartment renters has led to an explosion in the Austin rental market.

“For the first time it is actually cheaper to buy than to rent,” said Susan Albertson with City Wide Realty.

The average cost of apartment rent is more than $100 more per month than it was two years ago while occupancy has jumped to 95 percent, a 5 percent increase over the last year.

“It really got bad this year starting around January,” said Albertson who says finding prospective renters the right place at the right price is harder than ever.

Part of the reason is an increase in people moving to Austin, but a decrease in new rooms.

“Last year there was a lot of new construction and then this year there was no new construction.”

In 2008 and 2009, more than 7,000 new units were built, but that number dipped to just 2,300 in 2010.

And the outlook is not so optimistic.

“I don’t think it is going to get better this year,” said Albertson. “It is going to be one full year before we see the rental market improve any.”

Even outlying areas where deals traditionally could be had are in high demand, according to Albertson.

“I do not see better deals in Round Rock anymore, do not see the deals on (Ranch Road) 620,” Albertson said.

Ironically, the high demand for rentals has led to better opportunities for buyers.

According to Austin Investor Interests, the average rent per month in Austin is $876. It was $799 at this time in 2010, $780 in 2009.