The Popular Texas City That's Becoming Way More Affordable To Rent In
When deciding between renting versus owning a home, many people focus on the cost differences to try to make the right choice. This can be frustrating, though, because housing prices can fluctuate quite a bit over the course of several months due to things like changes in interest rates, inflation, and housing supply. What you might not realize is prices for rental homes and apartments also fluctuate regularly because of things like seasonality and market conditions. Rental prices also depend significantly on the city where the unit is located.
One of the biggest recent drops in rental prices is occurring in one of the fastest-growing metro areas in the United States – Austin, Texas. According to Newsweek, estimated costs to rent a home or apartment in Austin dropped almost 6% from summer 2024 to summer 2025. This reduction left rental prices in Austin at their lowest levels since 2021. In the Apartment List National Rent Report for August 2025, the estimated year-over-year price decrease in Austin's market was even higher at a 6.8% reduction, making it one of the U.S. cities where rent prices are falling the fastest.
The reduction in Austin's prices differs from what's happening in the United States as a whole. The estimates for rental cost increases for single-family units in 2025 compared to 2024 is plus-2.7% across the United States. However, that number represents a slowdown compared to the national average price increase from 2023 to 2024, which was 4.5%. Learn more about why Austin's rental costs are bucking the national trend.
Why is Austin's rental market seeing a recent year-over-year decrease in prices?
When it comes to determining the best city in Texas to live in, Austin always seems to rank highly. Significant population growth in the Austin metro area further shows its popularity, as the metro area grew by more than 50,000 residents from 2022 to 2023.
With such a high level of population growth and with Austin being a popular place to live, it almost seems backward that rental prices are dropping. However, a few different reasons explain the drop in prices. Developers in Austin may have built too many apartments recently. According to the Texas A&M University Texas Real Estate Research Center, the Austin metro area had about 3,300 building permits issued for buildings with five-plus rental units in August 2023. The years of 2022 and 2021 also had individual months reach about 3,000 building permits for units with five-plus rental units. These are some of the highest monthly numbers ever recorded for these types of building permits. By the time 2024 rolled around, more than 10,000 new apartment units were available to rent in the Austin metro area, causing rental prices to begin to fall.
Additionally, rental costs that were extremely high during the pandemic in 2020 and 2021 caused Austin's city government to generate a more friendly atmosphere for building new rental housing units. Those units are now available for rent, creating a greater supply than in other areas of the United States.
How Austin renters can take advantage of these lower rental home and apartment prices
Vacancy rates are on the rise in Austin, too, giving renters some leverage as they attempt to find a great rental unit at a great price with the amenities they want. For a two-bedroom apartment unit, vacancy rates were just shy of 10% in April 2025 compared to almost 4% three-plus years earlier. The 2025 vacancy rate represents a local 20-year high.
One way Austin-area renters can take advantage of these conditions is through leverage. Landlords can be pickier about not negotiating about their rental properties when vacancy rates are low. However, renters gain the upper hand in negotiations when the market is soft like it is now. Renters could ask for things like one or more months of free rent for signing a 12- or 24-month lease. If you're someone with a good credit score and a history of taking care of apartments, asking for a lower rental price per month is an option, too. Consider asking the apartment complex to waive things like parking fees or pet fees.
If your unit is nearing the end of the lease, you can ask for these concessions on the next lease. A rental company would prefer to keep a good tenant than go through the expense and hassle of finding a new tenant. Take some time to research the costs for similar apartments elsewhere in the Austin area and use these facts to actively negotiate a lower price that's in line with those units.