I'm from Bryan/College Station, and my friends and I have been wondering when the market would become super saturated with apartments, but they just keep building new complexes. With regard to your comment, I would state that the current low inventory for homes under $300,000 is directly related to the factors I mentioned in my original post.
If you imagine a pie chart based on the population in terms of family units and housing needs, you can make a rough generalization that 33% of the population can purchase and sell a home at any given time. The second 33% percent has historically consisted of future potential home buyers. This group is made of up of those saving required down payment, working on repairing credit, transitioning from renter to homeowner or generally preparing to become a homeowner. The final 33% will typically always be in the rental market due to finances, credit and other related variables. As I mentioned above this is a rough generalization. The percentages are chosen for simplicity. To look at it from a numbers perspective, B/CS has a population of roughly 150,000 plus 60,000 or so students. Excluding the students, simplistically, that breaks down to around 75,000 homeowners or family units. So, roughly 25,000 family units can buy or sell at any given time. The third group of 25,000 primarily only factors into the equation on the rental side of the market. The middle 25,000 should trickle into the market place, thus providing a constant demand. Note, the B/CS market is unique due to the large student population which equates to almost 30% of the total population in the area., and many students purchase homes instead of renting albeit with the assistance of their parents, thus skewing the market. It is also important to note that from the investment perspective many of the home purchasers in this group also utilize the favorable lending options as they make strong investment sense.
The issue we have witnessed since the last real estate bubble is related to the second group. This group typically trickles out from the rental market into home ownership, thus perpetuating a constant demand of home buyers. Market demand is further strengthened by the average home ownership turnover of roughly 10 years provided by the first 1/3 of the population represented in the pie chart. Since the last bubble and going all the way back to the Clinton presidency, there has been a strong governmental push for everyone to own a home. It escalated during the Bush/Obama years terms. The factors mentioned in my first post such a low credit requirements, historically low interest rates and loan products with minimal down payments has allowed for a mass majority of the second group to become instantly qualified as home buyers rather than having to continue to save and prepare, thus flooding the market with qualified buyers. So, demand exceeds supply, and we witness inflation, and that is followed by shortage. And, here we are. As a side note, rental demand diminishes, occupancy rates decrease and rental rates becoming flat or even reduced. Those who own residential investment properties should be able to attest to this state of the market with the exception of those in the most highly sought after areas surrounding the campus.