The Austin, TX rental market is collapsing before our eyes. With the median apartment rent dropping 15% over the last 2+ years. The vacancies have skyrocketed. Rental concessions are everywhere. Rents are now only 9.8% higher than pre-pandemic. Meaning that many Austin landlords are losing money, as property taxes, insurance, and interest costs are way higher. (This is a harsh lesson on the boom/bust cycle in real estate for many developers and investors who bought into Austin during the boom. Read more below to see how this happened.)

UPDATE: We shut down the luncheon honoring fracking enthusiast @mattyglesias. A third-rate "thought leader," this Harvard half-wit is ready and willing to incinerate his own child in the name of being "provocative." 🧵

*UPDATED* (and still true) When you build "luxury" new apartments in big numbers, the influx of supply puts downward pressure on rents at all price points -- even in the lowest-priced Class C rentals. Here's evidence of that happening right now: There are 21 U.S. markets where Class C rents are falling at least 4% YoY. What is the common denominator? You guessed it: Supply. Of those, all but one have supply expansion rates ABOVE the U.S. average. There's no demand issue in any of these 12 markets. They're all among the absorption leaders nationally -- places like Austin, Phoenix, Salt Lake City, Raleigh/Durham, Atlanta, Tampa, Dallas, Charlotte, Orlando, etc. But they all have a lot of new supply. Simply put: Supply is doing what it's supposed to do when we build A LOT of apartments. It's a process academics call "filtering." New pricey apartments are pulling up higher-income renters out of moderately priced Class B units, which in turn cut rents to lure Class C renters, and on down the line it goes. Less anyone still in doubt, here's another factoid: Where are Class C rents growing most? You guessed it (I hope!) -- in markets with little new supply. Class C rent growth topped 4% in 22 of the nation's 150 largest metro areas, and nearly all of them have limited new apartment supply. Most new construction tends to be Class A "luxury" because that's what pencils out due to high cost of everything from land to labor to materials to impact fees to insurance to taxes, etc. So critics will say: "We don't need more luxury apartments!" Yes, you do. Because when you build "luxury" apartments at scale, you will put downward pressure on rents at all price points. Spread the word.

do you have a substantive critique or just name calling?

You know JD Vance calls pepperoni rolls, “pizza rolls.”