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When you ask, “What will rents do in 2026?” the only honest answer is: it depends where, on what, and at what price point.
The good news is we’re not flying blind. We’ve got fresh data on supply, demand, and statewide forecasts that give small investors a decent map—if you read it the right way.
1. Statewide Baseline: Flat-to-Modest Growth
The Texas Real Estate Research Center’s latest forecast for the 12 months ending summer 2026 expects a steady but unspectacular rental environment:
- Statewide single-family rents: flat to slightly up, roughly in the $2,200–$2,300/month range, basically in line with 2024 levels.
- Apartments: average rent around $1,470 in mid-2025, with new units offering concessions and stabilized units seeing flat to slightly positive rent growth over the next year.
- New apartment deliveries: dropping hard—from about 92,000 units in the prior 12 months to <40,000 units projected through summer 2026. Less new supply is what eventually supports rent growth again.
That’s your base case: no statewide rent explosion, but a slow turn from “too much supply in some spots” toward balance.
From there, it’s all about the big four metros.
2. Dallas–Fort Worth: Stabilizing After a Supply Hangover
DFW has been the construction overachiever, and it shows in the rent numbers:
- Q3 2025: vacancy around 11.8%, with annual rents down about 1.4%—eight straight quarters of negative rent growth—but early signs of stabilization.
- Yardi’s 2025 report shows average asking rent just starting to tick back up after 11 months of no growth, with year-over-year rents still down about 1.5%.
- New supply remains heavy in northern growth corridors like Frisco, McKinney, Denton, while inner-ring suburbs and Fort Worth are tightening as pipelines thin.
How to think about 2026 in DFW:
- Expect modest rent growth at the metro level as absorption slowly catches up—call it low single digits.
- Submarkets with shrinking pipelines (many inner suburbs, parts of Fort Worth) should see stronger rent recovery than the oversupplied northern boom burbs.
- Your underwriting should assume slower rent growth but better tenant demand in well-located, non-luxury product.
3. Austin: From Free-Fall to Floor-Finding
Austin is the drama kid of Texas rentals:
- Massive building boom: roughly 31,000 new apartments in 2024 alone, with nearly 50,000 units delivered across 2023–24.
- Result: median asking rents fell roughly 9–11% year-over-year by mid-2025, and are down around 20+% from peak depending on the source.
- Permits have since plummeted, meaning the next supply wave is shrinking—today’s pain is tomorrow’s setup.
2026 outlook for Austin:
- Near-term rent growth: likely flat-ish, maybe a bit negative in the most overbuilt Class A urban pockets, as concessions burn off.
- Medium term: with permits down and population still growing, landlords who survive the concession wars are set up for healthier rent growth in 2027+.
If you’re buying, assume no rent growth in year one, but price in the fact that you’re entering well below the 2023 peak.
4. Houston: Quietly Setting Up for a Slow Grind Up
Houston’s story: huge supply, then a hard brake on new construction.
- Deliveries peaked around 25,000 units in 2024; 2025 deliveries are down nearly 38%, to about 14,400 units, with projections around 11,000 units in 2026.
- Occupancy in Q1 2025 was near 94%, the highest since 2022, with “flight-to-quality” favoring newer product.
- Forecasts call for metro-wide rent growth around 2–3% annually through 2027, with some submarkets (Neartown/River Oaks, Richmond/Rosenberg) expected to hit ~4%.
2026 takeaway:
- With supply fading and occupancy firming, Houston looks like a slow, steady rent-growth market, not a spike.
- The risk is insurance and weather, not demand. Your model should stress-test expenses more aggressively than rents.
5. San Antonio & Secondary Markets: Slow and Sticky
San Antonio’s home price index dipped slightly (about -0.4% YoY) by late 2025, with heavy seller concessions—classic “soft but not collapsing” conditions.
Combine that with:
- Persistent renter demand from households priced out of buying
- Less insane construction pipelines versus Austin/DFW
…and you get a rental market where small, steady rent growth (think 1–3% annually) is more likely than either fireworks or free-fall.
Surrounding secondary markets—think affordable suburbs and exurbs orbiting the big four metros—often see stronger relative rent growth because:
- They start from lower rent levels
- They benefit from “drive-til-you-qualify” migration
- They face less big-institution competition
But you still have to check local jobs, schools, and crime; cheap isn’t the same as investable.
6. How You Should Forecast Rents for 2026 Deals
For a small Texas investor, I’d treat 2026 like this:
- Base case:
- SF rentals: flat to +2% rents year over year.
- Apartments: 0–3% depending on metro and submarket, with Austin core on the low end and parts of Houston/DFW suburbs on the higher end.
- Stress test:
- Assume no rent growth for 2 years in oversupplied pockets (urban Austin, some DFW Class A clusters).
- Layer in higher expenses (insurance, taxes, utilities) and see if the deal still breathes.
- Upside:
- If supply truly dries up in your submarket and population keeps growing, you might see mid-single-digit rent growth again—but don’t build your whole business plan on that.
In other words: use the macro forecasts as guardrails, then zoom way in and make your rent assumptions conservative enough that 2026 is a win even if the “hot market” never comes back.
