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Northmarq Report Puts DFW #2 in BTR Units

While the national build-to-rent market works through its supply hangover, Texas is running a different playbook entirely.

DFW is built different: The Dallas-Fort Worth metro is now the second-largest BTR market in the country with nearly 25,000 units — and unlike most major markets, it's tightening. According to a recent Northmarq report, net absorption topped 4,000 units in 2025, up nearly 30% YoY, with over 2,500 of those units absorbed in just six months.

Vacancy is moving the right direction: While most major BTR markets saw vacancies rise in 2025, DFW dropped 70 basis points to 6.3%. Collin County alone added 250,000 new residents since 2020 and remains one of the most active BTR submarkets in the country.

The rent-vs.-own math: The average DFW BTR rent of $2,130/month clears the average apartment rate by $625 — but sits nearly $900 below a median-priced DFW mortgage payment. In Austin, that gap blows out to more than $1,500/month, one of the widest in the country. Austin also ranked third nationally for BTR net absorption in 2025 despite broader softness in its traditional apartment sector.

Where the growth is shifting: The Sunbelt still dominates, but developers are pulling back from oversupplied markets in the South and West. The Midwest is quietly emerging — Columbus and Indianapolis are posting sub-4% vacancies, Kansas City BTR rents are up 16% since 2021, and the region's share of national construction starts rose from 11% to 17% in a single year.

The policy wildcard: Proposed federal laws targeting single-family rentals add uncertainty to the sector. Early drafts focused on scattered-site SFR, but later versions were more restrictive towards BTR communities. No legislation has passed, but ambiguity keeps some sponsors on the sidelines—despite Fannie and Freddie's agency debt availability and 20% increase in loan caps to $88 billion for 2026.

➥ THE TAKEAWAY

Everything is bigger in Texas: Strong in-migration, a persistent ownership affordability gap, and disciplined absorption are giving operators and capital providers reasons to stay active while other Sunbelt markets pump the brakes.

➥ Office tenants are prioritizing shorter commute times over larger or higher-end spaces, reshaping leasing decisions in a hybrid-work era.

➥ A wave of new apartment deliveries in Texas is pressuring fundamentals, even as lenders continue to back select multifamily deals.

➥ Dallas-Fort Worth remains a population and economic powerhouse, though slowing immigration could temper its breakneck growth.

➥ Houston’s West Loop office market is gaining a competitive edge by offering better amenities and accessibility than downtown alternatives.

➥ North Texas continues to see a surge in large-scale development projects, reinforcing its role as a national growth engine.

➥ Energy executives in Dallas Fed surveys expect higher near-term oil prices, boosting confidence across Texas’ energy-driven economy.

➥ Texas leads the nation in cold storage demand as occupiers seek modern, temperature-controlled logistics facilities.

➥ Houston’s hotel market is gaining traction with strong spring performance, signaling a broader hospitality recovery.

➥ Dallas-Fort Worth’s coworking footprint has jumped nearly 30%, reflecting evolving workspace demand.

➥ A handful of powerful real estate families continue to shape Texas markets, wielding significant influence across development and investment.

Dallas-Fort Worth multifamily rents began 2026 largely unchanged, with modest early-year gains signaling typical seasonality but weaker-than-normal growth.

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