Cinco Ranch rental prices remained weak in April despite relatively healthy home sales during the month. The glut of multifamily housing in the West Houston Energy Corridor and Katy has continued to take its toll on monthly rents. Average rents within the master-planned community of Cinco Ranch were down by 6 percent compared to last year.
The pronounced softness in average rents within Cinco Ranch shows no sign of letting up.
The weakness in single-family rents hit both South Katy’s relocation market in April, as well as the more affordable rentals north of I-10. Prices in Katy’s relocation market (Area 36) reflected the same 6 percent drop year-over-year, with the volume of closed leases down about 13 percent. Prices in area 25 were down by a more modest one percent compared to a year ago on slightly higher volume.
The good news is that weakness in West Houston housing has been contained to the rental market so far this year. Home sales and prices have held up much better. The latest Houston housing report for April is going to show another month of higher sales and prices, driven in large part by good new home sales volume. The spring weather has apparently spurred many people to rush out and buy some of those expensive new homes, and builders have been happy to oblige.
It will be interesting to see if the strong sales numbers hold up through the summer, particularly now that oil prices have crashed back below the psychological $50 mark. Oil prices are now back to the lowest level since November, and that could definitely curb the enthusiasm of many in the energy industry.