The Dallas metro area is one of the top 10 real estate markets offering concessions to renters.
About 46% of apartment landlords in Dallas gave concessions to renters in October, marking a 17.4% increase compared to the same month in 2022, the latest Zillow housing data shows. The most common concessions provided to tenants included one to two months of free rent and free parking.
The primary reason for the increase in concessions is due to property managers facing increased competition for tenants, particularly as additional upscale apartments hit the market. According to Zillow, this trend is most pronounced in metro areas like Washington, D.C., Dallas, and Austin. The report notes that Dallas and Austin have 74,000 and 66,000 new multifamily units, respectively, either recently completed or currently underway.
“The pandemic era’s increase in concessions was a direct response to decreased renter demand. Currently, we’re witnessing a different scenario where the demand for rental housing is high, but there’s been a notable rise in supply,” said Anushna Prakash, an economic research data scientist at Zillow, per a press release.
“To differentiate themselves from newer, potentially more amenity-rich apartment buildings, property managers are stepping up their game, offering more incentives to attract potential renters with a broader range of choices,” Prakash said.
The top five metro areas where landlords offered the most concessions were Salt Lake City (54.4%), San Jose (50.8%), Washington, D.C. (49.6%), Charlotte (47.6%), and Minneapolis (46.8). Dallas ranked sixth with 45.9%.
By contrast, the metro areas with the lowest concession rates in October were New Orleans (9%), Providence (14%), Miami (14%), and New York (15%).
“This varied landscape suggests that property managers across the country are exploring different strategies as they gauge the effectiveness of concessions before potentially adjusting rental prices,” reads the press release.
