T
exas metros are grappling with the impact of a historic supply of apartment units coming online this year. In Austin, the surge in new housing is finally affecting rents, which are falling rapidly as the city absorbs the excess supply. According to Jay Parsons of Madera Residential, Austin takes up nine of the 15 spots on the list of submarkets with the steepest rent cuts nationwide.

    Southeast Austin leads the pack with a 12.8 percent drop in rents over the past year, followed by other Austin submarkets such as Cedar Park, Far South Austin, and San Marcos. Other cities on the list include Atlanta, Phoenix, Raleigh, Jacksonville, and Tampa. Parsons attributes Austin's rent cuts to an oversupply of apartments, with six of the city's 16 submarkets experiencing a 10 percent or greater increase in apartment stock over the past year.

    The abundance of new deliveries has led to a sharp decline in multifamily building permits across Texas and the country. Between 2021 and 2024, permits fell by 35 percent in Austin, 54 percent in Dallas, and 66 percent in Houston, according to Parsons' research. Fort Worth is the only outlier, with permit volumes remaining essentially unchanged over this period. However, Parsons expects this anomaly to be temporary, citing similar fundamentals across the Dallas-Fort Worth metro.