Houston’s construction equipment rental sector will notice a pick-up in inquiries from property developers, as the demand for multifamily housing leads them to plan more projects in 2018.
A significant portion of the huge increase in demand stems from Hurricane Harvey, which damaged several houses and apartments. Displaced residents have even considered rental properties that were otherwise uninhabitable prior to the storm. Lampson International notes that more developers will need construction crane rental services in Houston to build more residential properties to meet the demand.
The number of occupied multifamily properties rose to its highest figure since the last quarter of 2015, after rising to a 90.1% occupancy rate between August and September 2017 when Harvey hit Houston. Rental rates also increased due to a larger demand from hurricane victims. On average, monthly rents in September rose 1.4% to almost $1,000.
Job growth occurred at the same time, as local employers added a record high number of more than 43,000 new jobs in October last year, according to the Texas Workforce Commission. However, the construction industry needs to beef up its workforce to accommodate a higher demand for houses and commercial properties by 2019.
Jerry Nevlud, Associated General Contractors of Houston president, said there is a lack of skilled construction workers. This shortage might even become a bigger problem, amid a growing economy, lower corporate taxes, and rebuilding efforts from Harvey. The number of residential building projects may increase this year because of the latter.
On the other hand, commercial property projects have been growing steadily in Houston. These include private offices, warehouses, and medical and education facilities. Local construction firms said that rebounding oil prices, aside from energy companies’ investments in public infrastructure, boost the demand for non-residential construction.
The expected growth in Houston’s multifamily sector will be beneficial for home builders and construction equipment suppliers, although they need to find more construction workers to meet a growing demand in the future.