Construction picks up as North Texas apartment demand tops nation

North Texas had the greatest demand for apartments nationwide last year and now developers are building more than 34,000 units here, the most under construction in the U.S., a market study finds.

“Thanks to Dallas-Fort Worth’s hot economy, strong demand for apartments is keeping the stock basically full,” said Greg Willett, vice president with MPF Research. “In most neighborhoods, available choices in the middle price tier are down to a handful of units. The only sizable blocks of units ready to rent are in the brand-new projects moving through initial lease-up.”

In the first quarter, 3,537 apartments were leased in Dallas-Fort Worth, the MPF study finds. In 2014, 15,060 new units were brought to the market, second behind Washington, D.C., where 16,835 were built. And 34,109 units are under construction in DFW, the report said.

Willett said the Tarrant County market is especially strong. Annual rent growth was 6.6 percent in Fort Worth, compared with 5.1 percent in Dallas. Fort Worth’s occupancy was 95.1 percent, compared with the Dallas average of 94.7 percent.

“The lesser construction activity in Fort Worth gives Tarrant County a performance advantage,” Willett said.

The average monthly rent in DFW in the first quarter was $927, the report said.

Occupancy in North Texas reached 94.8 percent in the first quarter, the tightest rate since 2001, Willett said. Occupancy nationwide reached 95.4 percent, and rents rose 4.6 percent, the study said.

“Accelerating job creation is allowing more young adults to form new households, and almost all of the new households are opting to rent,” Willett said.

This story was originally published March 31, 2015 at 4:44 PM with the headline "Construction picks up as North Texas apartment demand tops nation."