Houston Rental Market Update: What 2025 Taught Us and How Smart Landlords Win in 2026
2025 is officially in the books. What a year.
As we head into 2026, this is a good moment to zoom out, look at what actually happened, and talk about what disciplined rental investors should be doing next.
The short version:
Ignore the hype. Focus on fundamentals. Optimize for occupancy, durability, and long-term returns.
Boring still wins.
Block Out the Noise and Play the Long Game
There will always be a trend or a “hot” market being sold by influencers.
Airbnb.
Austin.
Whatever is next.
The reality is that long-term rentals, held for many years, dramatically outperform chasing the next shiny thing. Time in the market beats timing the market. Compounding beats cleverness.
When it comes to investing, boring wins.
Do a Real Portfolio Review
Before making any big moves in 2026, complete a real review of your portfolio.
Ask yourself:
What actually performed in 2025?
Did CapEx show up early?
Do you have deferred expenses coming for roofs or HVAC?
Are you setting aside enough reserves, or are you one expensive turn away from a bad month?
Don’t be the owner who gets wiped out by a single repair.
Be harder to kill.
Do Your Properties Still Serve Your Goals?
Your priorities may have shifted. A rental that made sense five years ago may not serve your goals today.
If that is the case, think clearly about what you would move that capital into.
Be careful not to fall into “the grass is always greener” thinking. Jumping to the next thing before the current investment has had time to compound is one of the most common long-term investor mistakes.
If you are considering selling any real estate investment, here are three things to keep in mind:
This is not the best environment to be a seller. With high inventory, buyers have leverage
Transaction costs are high. Commissions, taxes, depreciation recapture, and friction add up fast
Understand the performance and volatility of whatever you plan to move your money into
For our owner clients, we handle sales analysis, CapEx projections, and portfolio performance tracking through our Quarterly Business Reviews and Annual Executive Strategy Reviews.
Either way, 2026 is a year to block out the noise and stay ruthlessly focused on your goals.
Total Portfolio Performance at a Glance
Rent Collection Rate: 97.7% (vs. 92.6% Houston average)
Eviction Rate: 1.6% (vs. ~9% Houston average)
Occupancy Rate: 91.2% (vs. 90.8% Houston average)
These are strong numbers across the board.
Traditionally, we see a noticeable spike in evictions during the holiday season. This year, the increase was mild and well within normal operating ranges.
A big part of this performance comes from Liz, our dedicated in-house Leasing Agent. Leasing during Q4 is one of the most difficult environments of the year, and her execution over the holidays materially improved both rent collection and occupancy.
Quick Tip: Avoid ending leases in Q4 (October, November, or December). Leasing during this window usually means longer days on market and softer tenant demand.
Houston Market Snapshot
Houston rental inventory continues to see double-digit growth.
New Listings (HAR): 4,525 → 5,486 (+21.2% YoY)
Average Rent: $2,263 → $2,245 (–0.8% YoY)
Average Days on Market: HAR – 48 days | Emerson – 46 days (4.2% faster)
There is no real surprise here.
Inventory is up.
Rents are flat.
And we are still leasing faster than the broader market, even if slower than I would prefer.
I started writing about this trend back in June 2025, and it has played out almost exactly as expected.
Landlords will continue to face pressure until one of two things happens:
Inventory comes down
Demand increases meaningfully
Demand has been steady, which is the good news. The headwind is supply.
Sellers who cannot sell their homes are turning into landlords, which keeps pushing rental inventory higher and increasing competition.
As I have said for the past six months, stay the course and build slightly larger reserves.
These are the environments where disciplined investors quietly win.
This is not the time to panic or pivot.
This is the time to be patient, liquid, and selective.
Maintenance Update
Median Speed of Repair: 5.4 days (vs. ~6–7 days national average)
Resident Satisfaction: 4.7 / 5.0
Work Orders Cancelled: 19.5%
Maintenance performance continues to be a major strength.
December is traditionally one of the slowest months for repairs due to holidays, contractor availability, and weather-related delays. Despite that, our median speed of repair still beat the national average.
Resident satisfaction remains exceptionally high. Very few property management companies nationally maintain a score above 4.2. Sustaining a 4.7 out of 5.0, while canceling nearly 20% of all work orders, is a strong signal that issues are being resolved correctly the first time and that unnecessary or duplicate work is being filtered out.
This score is one of the primary ways we evaluate and manage our vendors.
After every maintenance request, residents receive a short survey where they rate the vendor from 1 to 5 and can leave feedback. This allows us to hold vendors accountable not just on price, but on responsiveness, professionalism, and resident experience.
This feedback loop is how we keep maintenance fast, fairly priced, and high quality.
Quick Tip: If you are self-managing, text your residents after each maintenance request and ask how the vendor performed. Patterns show up fast.
Owner and Resident Satisfaction
Owner Retention Rate: 99.2%
Lease Renewal Rate: 64.5% (vs. ~55–65% national average)
Owner retention continues to rank among top national performers. In practical terms, our owners rarely leave. That is the clearest long-term signal that our service model and execution are working.
Lease renewals dipped this month to the high end of the national average. Historically, we run closer to 75–80%, so this is an area we are actively focused on improving.
The most common reasons cited were work relocations and family-related life changes, not dissatisfaction.
We are increasing proactive renewal conversations, being more available and responsive, and introducing more flexibility around renewal timing and terms to reduce unnecessary move-outs.
Keeping good residents in place is one of the highest-ROI things you can do as a rental owner.
Quick Tip: Remove as many barriers to renewal as possible. Do not give residents a reason to leave over friction, fees, or slow responses.
Value-Add Spotlight
While most properties are leasing at or below last year’s rent, 5807 Burlinghall Drive leased 13.2% higher than its previous rate.
We completed a simple turnover totaling $2,723, which included:
Targeted exterior repairs to improve curb appeal
Our standard preventative maintenance protocol
General painting and professional cleaning
The result:
Rent increased from $2,142/month to $2,425/month
A $283/month increase, or 13.2%
Leased in 24 days, during December
Even in a market where rents are flat or declining, there are still micro-markets and individual properties where rent can be pushed strategically.
The difference is knowing where and how far to push without blowing up vacancy.
A big part of this outcome comes from Liz, our dedicated in-house Leasing Agent. She has leased thousands of properties across Houston and brings real-time market feedback into our pricing and positioning strategy.
This is what professional asset management actually looks like.
Owner Insight of the Month: Vacancy Kills Cash Flow
As more competition enters the market, it is tempting to hold firm at last year’s rent price. That is usually a bad strategy.
One extra month vacant on a $2,400/month rental does not just cost you $2,400.
It costs you roughly $200 per month for the entire year once you annualize the loss. And when you factor in utilities, lawn care, HOA, insurance, and property taxes, you are often losing $80–$120 per day while the property sits empty.
That is real money.
The formula for minimizing vacancy is simple:
Complete a thorough, high-quality make-ready
Take professional photos
Price the property appropriately relative to competition
Respond quickly to prospective residents
Adjust pricing based on lead volume
Miss any one of those and vacancy explodes.
If you get to the end of the year wondering why your rental underperformed, start by checking your occupancy.
The market always tells you the truth.
Your job is to listen before vacancy makes the point for it.
Final Thoughts
2026 is not the year to panic or pivot.
It is the year to block out the noise, build durability into your portfolio, and stay ruthlessly focused on fundamentals.
If you want help reviewing your portfolio, projecting CapEx, or stress-testing your cash flow, that is exactly what we do at Emerson.
To your success,
Cam
