Why Is Rent in Austin Going Down? Exploring the 2025 Data
Published | Posted by Dan Price
Why Is Rent in Austin Going Down? A Data-Driven Look at the Austin-Round Rock Rental Market
If you’ve been wondering why rent in Austin is going down, the answer lies in the detailed data tracking the Austin-Round Rock metropolitan area’s rental market. For 2-bedroom multifamily apartments, rents have dropped significantly, falling from a high of $1,726 in August 2022 to $1,431 by April 2025, a decrease of about 17.1%. This decline is closely tied to changes in vacancy rates, new apartment construction, and a surge in residential lease listings, all of which provide a clear picture of what’s happening in the area. Let’s break it down using the latest information available as of June 10, 2025.
One key factor is the rising vacancy rate for 2-bedroom apartments. In September 2021, the vacancy rate was just 3.96%, meaning almost all units were occupied. By April 2025, that rate had climbed to 9.92%, the highest in the dataset stretching back to 2017. This increase shows there are more empty apartments than before, which often leads landlords to lower rents to attract tenants. For example, when vacancies rose from 6.13% in September 2022 to 9.79% in January 2025, rents dropped from $1,714 to $1,428, highlighting a direct connection between available units and rental prices.
Another big influence is the wave of new multifamily apartment buildings coming online. Data on permits issued for 5+ unit buildings shows a strong construction trend, with an average of 78.1 permits per 100,000 population in 2024, up from 41 in 2017. Notable peaks include 121.2 permits in April 2022 and 108.7 in October 2023, with early 2025 still seeing activity like 36.4 permits in March. Since building these apartments typically takes 12 to 24 months, many units permitted in 2022 and 2023 are likely completed or nearing completion in 2024 and 2025. This influx adds to the supply of 2-bedroom apartments, contributing to the higher vacancy rates and pushing rents downward.
The rental market isn’t limited to apartments, though. Data from the Austin Area Multiple Listing Service (MLS) tracks active lease listings, mostly for single-family homes and condos, with very few apartments. These listings have jumped dramatically, from 2,180 in December 2022 to 6,185 in December 2024, peaking at 7,158 in July 2024, and standing at 6,532 in June 2025. This represents a 200% increase since January 2021, when listings were at 2,180. While this data focuses on residential leases rather than apartments, the large number of available homes and condos gives renters more options, which can indirectly pressure apartment landlords to lower rents to stay competitive, especially for 2-bedroom units popular with similar renter groups like young professionals or small families.
The shift in supply and demand also plays a role. Back in 2020 and 2021, rents for 2-bedroom apartments soared from $1,286 in December 2020 to $1,726 in August 2022, a 34.2% rise, driven by low vacancies like 4.16% in August 2021 and strong demand from population growth. However, since mid-2022, with vacancies climbing and new apartments and residential listings flooding the market, rents have fallen. This suggests that the rapid increase in supply—both from new apartment permits and MLS listings—has outpaced demand. Possible reasons include slower job growth in Austin’s tech sector, more people working remotely and moving to cheaper areas, or renters leaving the metro area due to high costs, though specific data on these trends isn’t included here.
Finally, the rent decline since mid-2022 can be seen as a market correction after the sharp increases of 2021-2022. For instance, rents grew 19.7% year-over-year from July 2021 to July 2022, but by November 2023 to April 2025, they dropped 8.7% from $1,567 to $1,431. With vacancy rates at 9.92% and inventory high—6,532 MLS listings in June 2025 and ongoing apartment construction—this adjustment reflects a return to more sustainable rent levels. Landlords are likely cutting prices to fill units rather than holding out for the high rates seen two years ago, especially as the market adapts to the current supply-heavy environment. Understanding these trends helps explain why rent in Austin is going down. The combination of rising apartment vacancies, new multifamily construction, and a booming residential lease market, all tracked through detailed data, points to a rental market with more options than demand can currently absorb. As of June 10, 2025, this data-driven story continues to evolve, offering a clear view of the forces shaping Austin’s rental landscape.
FAQ Section
1. Why is rent decreasing in Austin, Texas?
The decrease in rent in Austin, Texas, is driven by a combination of factors reflected in recent data from the Austin-Round Rock metro area. For 2-bedroom multifamily apartments, vacancy rates have risen from 3.96% in September 2021 to 9.92% by April 2025, indicating an oversupply as landlords compete to fill units, lowering rents from $1,726 in August 2022 to $1,431 by April 2025. Additionally, permits for 5+ unit apartment buildings averaged 78.1 per 100,000 population in 2024, with peaks like 121.2 in April 2022, adding new supply that takes 12-24 months to complete and likely contributes to higher vacancies. The MLS data, showing active residential lease listings (mostly homes and condos) surge from 2,180 in December 2022 to 6,532 in June 2025, further increases rental options, indirectly pressuring apartment rents. This supply growth outpacing demand, possibly due to slower tech sector job growth or remote work trends, supports the ongoing rent decline.
2. What is causing the rental market to cool in Austin?
The cooling of Austin’s rental market is evident in the data showing a shift from tight supply to excess. Vacancy rates for 2-bedroom apartments have climbed to 9.92% by April 2025 from 3.96% in September 2021, a 150% increase, correlating with a rent drop from $1,726 in August 2022 to $1,431 by April 2025. This is fueled by a construction boom, with multifamily permits averaging 78.1 per 100,000 population in 2024, up from 41 in 2017, and peaks like 108.7 in October 2023, adding new units to the market. Meanwhile, MLS residential lease listings have skyrocketed from 2,180 in December 2022 to 6,532 in June 2025, offering renters more choices and increasing competition. This supply surge, potentially outstripping demand due to economic shifts or out-migration, is cooling the market as rents adjust downward.
3. How much have rents dropped in Austin recently?
Recent data indicates a notable drop in rents for 2-bedroom multifamily apartments in the Austin-Round Rock metro area. Rents peaked at $1,726 in August 2022 but have declined steadily, reaching $1,431 by April 2025. This represents a total decrease of approximately $295, or about 17.1% over this period. The decline accelerated after mid-2022, with a 8.7% drop from $1,567 in November 2023 to $1,431 in April 2025, reflecting rising vacancy rates (from 6.13% in September 2022 to 9.92% in April 2025) and increased supply from new apartment permits (78.1 per 100,000 population in 2024) and MLS listings (6,532 in June 2025), indicating a market correction amid oversupply.
4. Are rents in Austin still affordable after the recent decline?
Whether rents in Austin remain affordable after the recent decline depends on local income levels and cost-of-living benchmarks, though the data provides a clear picture of the trend. For 2-bedroom multifamily apartments, rents have fallen from $1,726 in August 2022 to $1,431 by April 2025, a 17.1% drop, reducing the monthly cost by $295. This brings rents closer to levels seen in late 2020 ($1,286), when vacancy rates were lower (7.79% in December 2020). However, with the median household income in the Austin-Round Rock area around $80,000-$90,000 annually (based on general U.S. Census estimates), a $1,431 monthly rent still consumes 19-21% of income, above the 30% affordability threshold for many. Rising vacancies (9.92% in April 2025) and new supply (78.1 permits per 100,000 in 2024) suggest further potential declines, but affordability remains a challenge without additional income growth.
5. What factors are influencing Austin’s rental prices in 2025?
In 2025, several data-driven factors are influencing Austin’s rental prices, particularly for 2-bedroom apartments in the Austin-Round Rock metro area. Vacancy rates have reached 9.92% by April 2025, up from 3.96% in September 2021, driving rents down from $1,726 in August 2022 to $1,431, a 17.1% decrease, as landlords compete to fill units. New multifamily construction, with 78.1 permits per 100,000 population in 2024 and 36.4 in March 2025, continues to add supply, likely completed from 2022-2023 permits. Additionally, MLS residential lease listings have surged to 6,532 in June 2025 from 2,180 in December 2022, offering renters more options and indirectly pressuring apartment rents. This supply growth, potentially outpacing demand due to slower tech sector expansion or remote work trends, shapes the current downward trend in rental prices.
