The rental market in Texas is seeing a significant demographic shift, with retired seniors increasingly opting to rent rather than own a home. This trend is especially pronounced in the state’s major metropolitan areas, reflecting a broader migration pattern across the Sunbelt.
Senior Rental Growth is Skyrocketing
Major Texas cities are experiencing massive growth in their senior renter population. Over a recent 10-year period, Austin led the national charge with an 80% rise in its share of senior renters. Dallas-Fort Worth (DFW) and Houston were not far behind, logging jumps of 66.5% and approximately 60%, respectively.
This data underscores how the boomer generation is actively reshaping the housing market, making Texas rentals a highly desirable option for retirement.
Why Seniors are Trading Ownership for Renting
The decision to rent is driven by several compelling financial and lifestyle factors:
- Cashing Out Equity: Many seniors are selling their long-time homes, often with significant equity, to fund a more comfortable retirement.
- Avoiding Maintenance: Renting allows seniors to offload the burden of property maintenance, repairs, and upkeep to a landlord.
- High Property Taxes: Texas property taxes, which can be burdensome for long-term homeowners, are eliminated when transitioning to a rental. While Texas law provides a $10,000 homestead exemption for seniors 65 and older, and allows them to cap the school district portion of their property tax, the overall tax burden can still be a major incentive to downsize and rent.
- Downsizing: Many seniors simply want to downsize after their children have moved out, preferring smaller, more manageable living spaces that rentals offer.
Seniors Are Moving the Market
This shift isn’t just affecting the rental side; seniors are moving the housing market in both directions. The significant influx of older renters and a rising median age for first-time home buyers show that seniors are currently one of the most active and influential demographics in the Texas real estate landscape.