Historic Decline: Austin’s Median Rental Price Drops in 2024 After Two Decades of Growth

In 2024, the Austin rental market has witnessed its most significant shift in over two decades. According to recent data, the city’s median leased price has dropped by 2% year-over-year, the largest annual decline since 2002. This is a noteworthy development for a city that has been experiencing rapid growth and soaring rental prices in recent years.

The median leased price in Austin for 2024 is $2,300, a decrease from $2,350 in 2023. This 2% drop is particularly striking when compared to the substantial gains seen in 2022, when the median price surged by 18%, reaching an all-time high. The trend reversal suggests that the Austin rental market may be cooling down, perhaps due to a combination of increasing rental supply and evolving economic conditions impacting demand.

In terms of average rental prices, Austin also saw a decrease. The average leased price for 2024 stands at $2,608, down 1% from $2,647 in 2023. While the reduction in the average price is not as significant as the median, it reflects a consistent downward movement. This aligns with the broader trend in the median price, showing that both metrics are indicating a softer rental market.

The number of units leased in 2024 has decreased to 12,850, down from 14,874 in the previous year. This drop in leasing activity could be linked to various factors, such as affordability issues, potential renters shifting to homeownership, or the increase in remote work opportunities allowing people to seek housing options outside of the city. The lowered demand is likely putting downward pressure on prices, contributing to the observed declines in both median and average leased prices.

Historically, Austin has experienced fluctuations in its rental prices, but this year’s decline is unique due to its magnitude. The last time Austin saw a drop of this scale was in 2002, when the median leased price fell by 13%. Since then, the market has generally trended upwards, with only occasional dips, such as a 1% decrease in the average leased price during 2009 and 2010, and more recently, the 1% dip in 2023. The 2024 decline, therefore, stands out as a considerable shift, signaling possible changes in the long-term rental landscape for Austin.

Despite these declines, the rental prices remain high compared to a decade ago. In 2013, the median leased price was just $1,450, which is significantly lower than today’s $2,300. This increase reflects Austin’s growth and its transformation into a sought-after urban area, attracting professionals, families, and students alike. However, the current dip may suggest that the market is stabilizing, possibly offering renters a brief respite from the upward pressure on prices.

As we look forward, it remains to be seen whether this cooling trend will continue, or if Austin’s rental market will rebound. Factors such as interest rates, employment levels, and broader economic conditions will likely play a role in determining the direction of rental prices. However, for now, renters in Austin may find some relief as the market appears to be adjusting after years of sustained growth.