HOUSTON – Africa Releford moved into her Rosharon home in March after spending months looking to buy a home.
The single mom was near closing on a home until she changed her mind.
“It got to just like and then there’s this expense and then then there’s this thing,” Releford said referencing additional costs. “It just dawned on me like, why don’t you just rent?”
Releford isn’t the only one deciding to rent instead of buying.
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Realtors say there’s a supply and demand problem in the Houston area as more people relocate. This is one of the reasons why they believe it costs more to buy a house now than a few years ago. The Kinder Institute for Urban Research’s 2024 ‘State of Housing’ report confirms it. Researchers found between 2018 and 2023 the cost of a home went up 43%.
Tim Surrat, a realtor with Greenwood King Properties and a former Houston Association of Realtors board member, isn’t surprised especially as more people move into the Houston-area.
“We’ve added 120,000 people in Houston. We don’t have enough housing for everyone. And not everyone wants to live in these apartments they’re building,” Surrat said. “We have less than a two-month supply of housing in Houston, which means it’s a seller’s market and the prices are up even on the rentals, the prices are up 3%. On sales, they’re up 5%. And there’s just not enough housing for everybody.”
Surrat gave KPRC 2′s Rilwan Balogun a tour of Iowa Colony rental community, Balcara at Meridiana.
“This entire community [are] all rentals. Is this something we will see more moving forward,” Balogun asked as they walked the neighborhood.
“100 percent,” Surrat responded. “We’ll see more of this. And this is a new phenomenon in the last five years.”
Surrat said in July there were 30 move-ins at the Balcara at Meridiana.
“This is a new phenomenon,” Surrat said.
Greystar, a company traditionally known for its apartment complexes has taken notice of the growing ‘phenomenon’ and joining in on the trend. The company will manage rental community Preserve at Highway 6.
“This is a very exciting space where you’re bringing together the traditional home building-for-sale world and the institutional, smaller format apartment-for-rent space,” said Greystar’s Dallas-based Development Services Managing Director Andrew Ord in an email to KPRC 2. “Of course, millennials are aging and expanding their families, so maybe they need a third bedroom or want to move outside city limits where they can have something larger that still meets their needs and conveniences, and this product is perfect for them. We also see older residents who are looking for a professionally managed community where they still want to have their own home, but do not want to deal with all the maintenance and upkeep that comes with homeownership.
Ord said the company is building close to 4,500 rental homes nationwide.
“In the greater Houston area, we are currently under construction on the Summerwell Sunterra BFR community in the Katy, TX Sunterra master planned community. Summerwell Sunterra has 153 total homes, and first deliveries are slated for this Summer,” Ord adds. “More broadly, we are primarily focusing on Sun Belt markets, including Florida, Atlanta, Texas, Arizona, and California. We also have an interest in expanding to the Mountain West, as there’s a strong demand for this product nationwide.”
Surrat said there are two reasons why more people are renting: pricing and simplicity. Not to mention, renting is cheaper.
“The initial cash outlay is not as much,” Surrat said. “You just might have to have one month’s rent in advance for security deposit instead of, for instance, if they sold for $350,000, they’d have to have, you know, $20,000 cash available. Well, now they only need $5,000 cash to move in.”
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Rental properties are managed like apartments, so they have maintenance on site ready to fix issues.
“A lot of people don’t want to maintain their own yards. They don’t want to maintain the house. They don’t want to worry about the storms,” Surrat said. “Rental project like this gives those people simplicity. So, they just found a market and they’re going after it and they’ve done a good job.”
Costs and simplicity are reasons why Releford chose renting, in addition to having plans to downsize when her son graduates high school.
“So, this allows me to be able to, you know, just leave once that lease is up,” she said. “You’re not tied down. Once your lease is done, it’s done. So, you know, then you can have choices.”