Why the Houston apartment market doesn’t feel as good in 2016

​​HOUSTON – The oil slump is taking its toll on Houston’s multifamily market.

In January, Camden Property Trust issued a C and declining outlook for the Houston apartment market. Three months later, company officials said they are “feeling worse” about Houston, in part because job estimates are coming in less than expected.

Houston’s apartment market ended 2015 on a relatively firm footing with overall occupancy levels above 90 percent and rent levels continuing to grow, albeit at a slower pace than the boom years.

However, as the oil slump continues to roil the Houston economy, Camden’s revenue from its Houston properties has fallen flat and may dip into negative territory later this year, officials said.

Experts say Houston developers are delivering too many apartments as energy companies continue to announce layoffs and budget cuts to weather the low oil prices.

CBRE Group Inc. predicts a total of about 25,000 new apartment units will be delivered this year, representing about 4 percent of the entire Houston apartment market.

Houston developers delivered 5,034 new apartment units during the first quarter of 2016, according to the Los Angeles-based commercial brokerage.

That figure will be dialed down, quarter by quarter, until there are few if any new apartment projects coming online in 2017 and 2018, said Clint Duncan, CBRE Houston’s new senior vice president of multifamily.

The oil slump has cooled demand for new apartments. Experts predict between 12,000 and 15,000 new jobs will be added to the Houston economy this year, a far cry from the more than 100,000 new jobs created annually only a couple of years ago.