Real Estate Mogul Grant Cardone Declares Real Estate Correction in Austin, Texas

Real Estate Mogul Grant Cardone Declares Real Estate Correction in Austin, Texas

With rent for multifamily properties in Austin, Texas, falling 6.2% from last year, real estate mogul Grant Cardone has declared the city is undergoing a real estate correction. In a recent post on Twitter, Cardone highlighted the oversupply challenge facing the city, with 18.9% of apartments either under construction or in the lease-up phase.

“The real estate correction is underway, and it will create a 10x opportunity for long-term investors,” Cardone stated. Despite the overall decline in rent prices, there are pockets of Austin that have shown resilience and growth. Areas like Lake Travis and far North Austin have experienced a 20 basis-point increase, reaching 95.8% occupancy — the highest in the market.

However, Cardone had previously expressed caution about the Austin real estate market due to the glut of available apartments. Cheryl Higley, managing director of debt and equity for Northmarq’s Austin office, also acknowledged the oversupply issue driven by recent construction in the multifamily sector.

Higley noted that vacancy rates have reached a 20-year high but expressed optimism that the market will gradually balance out in the long run. Multifamily developers are targeting Austin’s growing population of young adults aged 20 to 34, who are more inclined towards renting than homeownership.

The city’s appeal to this demographic, with its vibrant culture, tech hub status, and high-paying job opportunities, has made it a top target for commercial real estate investment. In fact, Austin ranked second in CBRE’s 2023 U.S. Investor Intentions survey and placed second among North America’s 30 hottest tech hubs.

As the market continues to evolve, investors and developers are closely monitoring the trends in Austin’s multifamily sector to capitalize on the opportunities presented by the real estate correction.