HOUSTON -- Growing demand and fewer available apartment units in Houston are expected to significantly raise rental rates over the next year.
Rental rates have grown 16 percent since 2005.
In 2011, renewal rates for high-end, luxury apartments are expected to jump as much as 20 percent to 40 percent.
"The supply and demand dynamics are there to have rents rise," said Bruce McClenny, president of Apartment Data Services.
McClenny said more people have moved into apartments as fewer developers have built new ones.
Another factor is the soft housing market.
Sarah Jones, owner of Bamboo Leasing, an apartment locator service, said some people have opted to buy instead of rent.
"Look again at buying," she said. "There [have been] renters who were heart set on renting [but] realized that buying now is truly a less expensive option in Houston."
Susan Johnson, who moved to Houston with Kiern Ryan from Adelaide, Australia, because of a job transfer, settled on a two-bedroom apartment at Venue Museum District.
"There's a big difference between different places," she said. "If you want good quality you are going to end up paying more."
Industry insiders said the apartment crunch may not ease until 2012 when developers begin to start building new apartments in Houston.
