Smaller Texas Markets Show Strong Population, Job Growth

While Dallas garners much attention for its multifamily growth trends in Texas, a number of smaller markets in the state have increased apartment stock significantly or are set to do so.

RealPage studied the job market and population growth in four such markets.

The Sherman-Denison market, located a few miles from the Texas-Oklahoma border, is notable for the addition of two new semiconductor plants recently built in the market, which are expected to bring 5,000 new jobs. Total employment in the market grew 2.6% for the year ending in June and only 6,800 housing units are available, according to data from RealPage.

Occupancy in the Sherman-Denison market was 91.8% as of July, and the market has 1,848 units under construction with an effective rent average of $1,131.

In the College Station-Bryan market, no units were underway as of the second quarter, but that follows a sustained wave of new supply in College Station over the past eight years. Texas A&M University’s student housing also saw significant supply volumes during that same time period, said the report.

However, the job growth ratio in this market is among the highest in the nation, with its education and health services sector as well as its professional and business services sector growing strongly during the past couple of years. Occupancy in College Station-Bryan stands at 93.8% with an effective rent of $1,113 in July.

Another college town, Lubbock is buoyed by Texas Tech University and its 40,000 students, which has helped its education and health services sector grow at a strong pace in recent years. It also has posted strong gains in the leisure and hospitality services sector. A hub market in West Texas, Lubbock, has a stable jobs economy servicing a multitude of nearby rural communities.

Following an 8% growth of inventory over the past five years, less than 500 units are currently under construction in the market. Occupancy in the market is 91.9% and effective rent is just $935.

Situated between fast-growing markets Austin and Waco, the Killeen-Temple market encompasses the largest U.S. military installation in the world. The 340-square-mile Fort Cavazos base (formerly Fort Hood) supports more than 34,000 active-duty military personnel and an additional 13,000 civilians and contractors. As a result, the government is the largest employment sector in this market.

However, most construction activity in the market is happening in the Temple/Belton submarket, with 446 units underway, as the population has grown at one of the fastest rates in the state – more than 10% between 2017 and 2022. Occupancy in the market is 89.5% and effective rent is $1,091.