Houston retail starts year strong with highest January leasing activity on record.
Vacancy rate at 5.9%
One month into 2022, overall vacancy in the Houston retail market has tightened to 5.9%, dropping 60 basis points from this time last year. Availability is at 6.5%, down 80 basis points from January 2021. The difference between this figure and the vacancy rate reflects expected future move-outs. January 2022 marks the highest amount of leasing activity in January on record for the Houston retail market. 925,000 sq. ft. of leasing activity comprised of both new leases and renewals was recorded, while net absorption (move-ins minus move-outs) is at 369,000 sq. ft., up almost 40% year-over-year from 266,000 sq. ft.
Average retail NNN asking rents at all-time high
Positive trends in leasing and absorption have driven average retail asking rents higher. The Houston metro NNN average asking rent is at an all-time high of $19.42 per sq. ft., up 4.7% from $18.55 this time last year. Strengthened by the region’s robust demographic growth and paired with a slowing development pipeline, rent growth is expected to improve further through the near-term forecast so long as the public health situation continues to improve and local economic recovery continues apace.
Retail and rooftops
The Houston real estate market charged into the new year carrying the positive momentum it sustained throughout 2021. According to the Houston Association of REALTORS, single-family home sales rose 7.1% with 6,451 units sold compared to 6,024 in January of 2021. The average price of a single-family home rose 16.2% to $377,738, while the median price shot up 17.9% to $310,000. Sales of all property types were up 9.3% year-over-year, and total dollar volume for January jumped 28.1%.
Leta Wauson
Director of Research
[email protected]
tel 713 275 9618