How is the San Antonio real estate market? As one of the biggest cities in Texas, it is reasonable to consider it as a strategic place for property investment. The city is located in South Central Texas, not too far from other popular cities in the state. Driving a car takes only an hour from Austin and 3 hours from Houston.
San Antonio itself is a point of the Texas Triangle consisting of 3 metropolitan areas along with New Braunfels and Austin. The economic condition in the area is developed very rapidly from time to time as well as it includes various sectors starting from manufacturing, health, finance, to defense. Not to forget, the Triangle is also well-known as a place for mining exploration and production, oil and gas. That’s why, when those things bring positive influences to the property sector, it is just reasonable.
Some reports also show that the city is one of the most recommended places for the real estate market. The National Association of Realtors (NAR) marks San Antonio as one of the top 10 hidden gems for property markets. The data also show that prices of houses increase about 20% from year to year. Besides, it is also reported as one of the most stable markets for property rentals.
So, here are further explanations about the San Antonio Real Estate market you need to know.
A Brief History of San Antonio’s Real Estate Market
There is a very long history of the real estate market in San Antonio. Even you may need to refer to the event happening many centuries ago to start it. Well, in the beginning, San Antonio was established as a Spanish colonial post in 1718. A spot namely the Alamo was used as the battlefield of Texans in an attempt to free themselves from Mexico.
The strong historical background causes San Antonio to have a dense population since the first time it was built. The city also has developed very rapidly in the last decades.
An interesting fact about the city in Texas is, despite the fact that many people have been living there from many centuries ago, you can say that the property price is considered not too expensive. Moreover, it is when you compare it with some other areas around.
But of course, by considering the data that the property tends to increase significantly every year, San Antonio becomes one of the places demanded by investors to do long-term investments.
A real estate market observer, Freddie Mac releases monthly data on the house price change in all the markets throughout the US. For San Antonio, here are some historic data to use to determine the market condition of houses in San Antonio in the future.
Starting from the HPI of October 2016, it was 187.6 and in October 2021, it is 282.7. If you calculate it, the gap in the house price in 5 years is 50.7% and the average annual change is 19.0%. Per month, it is 1.3%.
Based on that percentage, is the house price in San Antonio considered affordable or not? The report of the house affordability index is commonly used to determine the rank of the city market in the US. Houses in a city are said not to be affordable when the index is closer to or less than 100. On the other hand, when the index is above 100, it means that the market is considered affordable.
From the number calculated above, it was found that the index for San Antonio is 135 in the mid of 2021. People in the city buy houses with prices around 1.3 times more expensive than their income. It refers to the metropolitan area of the city anyway.
Since the average price is above the average income, houses in San Antonio are not affordable. But that number also shows that they are still reachable enough since it is not too far from their income. Plus other factors, just make the city one of the best places in the US for real estate investments. It is such good news for real estate investors San Antonio.
San Antonio Real Estate Market
Many reports and surveys state that the current condition of the San Antonio real estate market is good, even strong. Well, not only NAR that praises the city by calling it a hidden gem. It is also one of the cities with the most rapid development in the country in 2022. Meanwhile, the tax, as well as the living cost, are also low, making it a magnet for people to come and live there.
More than that, there are some more interesting facts about the San Antonio housing market throughout 2022 you need to know. Yes, here are some reasons why investing in properties in the city is a great decision.
First, in April 2022, the average price of houses in San Antonio increased 20.5% compared with the price in April the previous month. It means that the percentage also raises by around 5% more than the average annual increase. Even based on a set of data, the price is increased up to 59%.
The San Antonio Board of Realtors state that the average price of typical houses in the city is $326,500 in March. Meanwhile, although the price has increased, people still consider it not that expensive and affordable enough. Particularly, it is when the price is compared with other metropolitan cities in Texas. Imagine it, in Austin, the price reaches more than $600,000.
Second, San Antonio also has a strong seller market. Along with the population growth in the city, it currently only has an area supply for 1.6 months. It causes tighter competition for sure as well as the selling and buying transaction tends to happen faster.
Third, San Antonio is also considered to have a very interesting renting market. Houses with renters are around 39% of the total of houses in San Antonio. Based on the report from a business journal of the city, San Antonio is also one of the most stable renting markets in the US.
If you take a look at the housing market San Antonio in the last 3 years, the rental price for houses with 3 bedrooms has increased up to 21% or $1,700. Interestingly, rental prices in some elite areas like Forest Crest, King William, and more, start from $3,169 to $4,500.
Investing properties in San Antonio for rent is indeed a good decision for its big military population. This group of people prefer renting to buying since they may only live in the city temporarily. They will move sooner or later because of their duty.
By seeing some data above, San Antonio indeed has a good property market climate this year. Well, it seems that the situation will continue for next year. It can even be better anyway.
San Antonio Real Estate Market Forecast
So far, the prediction of how the San Antonio Real estate market made in previous years is true. One of the most memorable ones is when it was forecasted to be more than any other cities in Texas in 2022 with a house price increase of 3.5%. Although the percentage is not exactly the same there is indeed a good development.
Another right prediction is when Curbed named San Antonio as one of the 5 highest-ranked cities for the best property investment this year. Without waiting for too long, it seemed that the prediction of Curbed about the performance of the San Antonio housing market was right. Based on the report from the San Antonio Board of Realtors, the average price of family houses in the city is increased up to 19% from 2021 to 2022. The COVID-19 pandemic may influence the ability of people to buy houses indeed but it is just not too significant.
Dan Antonio is a good place for buying a house this year and interestingly, it is even better for landlords. Generally, people indeed prefer renting and buying in the US. This phenomenon is found not only in San Antonio but also in other big cities starting from New York to Miami.
Of course, it is not only for this year but also for some years later. As has been mentioned above, San Antonio is a place for military officers who live in the city temporarily. For landlords, it is always beneficial to own and rent their houses in the city.
In the future, the rental costs are also predicted to continuously increase for the increase of newcomers. It can also be seen in the forecast for population growth. Besides, the limit of land available currently also becomes a good reason why it is recommended to buy properties in San Antonio now for the sake of the future.
What’s more in San Antonio real estate news and forecast? For the next decade, many experts also predict that the economy in the city will increase up to 39.6% quicker than the national average. This brings many good effects starting from the lower unemployment level, significant population growth, and income improvement that must be very positive for real estate investment.
Pros and Cons of San Antonio Real Estate Market
After reading some points above, you may simply conclude that San Antonio is one of the best cities in the US for property investments and it can just be true. But nothing is perfect in this world. While the San Antonio market for real estate has a bunch of pros, there must be some cons also. So, here are the summaries.
- Pros
The first pro is that the city has significant developments in various sectors to support the real estate market. They are the growth of population, the lower unemployment, high demands for houses for rent, and many more. Seeing this point of view, buying a house or land in the city is a good move as it can be really a good investment for the future.
Second, particularly if you are interested in buying land, don’t worry. You can get the second pro. It is low maintenance. People just love to buy land in the city not for being built into a house or building. They just keep it that way to be cashed after a few years. With a price increase of around 20% per year, they can just get the profit they deserve. But of course, it is not a bad idea also to turn it into a house for profits found from the average rent in San Antonio.
Lastly, the tax in San Antonio is quite low. It makes the city currently one of the destinations for people who move from other cities to get more comfort in their life. Well, the lower living cost is also a reason living here is more economical.
- Cons
Fortunately, the cons are less than the pros. Undeniably, if you compare San Antonio to other cities in the US, it is less popular for investment. There are more cities with higher property price developments. That’s why you may consider investing in other places anyway. Just don’t forget that San Antonio is the most stable one based on some surveys.
San Antonio Real Estate Market FAQs
- Will housing prices go down in San Antonio?
No, it is not. The housing price in San Antonio tends to go up with an average increase of 20% every year. From 2021 to 2021, the percentage is even 20.5%. And the trend is predicted to continue like that some years later.
- Is it a buyer or seller market in San Antonio?
San Antonio is considered a buyer market in April 2022. The supply of properties is higher than the demand.
- Is San Antonio real estate going up?
Yes, it is. With the average increase of 20% annually and there is no sign of significantly going down based on the San Antonio real estate forecast, a city is a good place for investment. In addition, the percentage has even increased up to 20.5% this year.
- Is San Antonio rent going up?
Yes, the rent is going up. Based on the data from the Apartment List website, the rent went up by 15.1% in March compared with the percentage in the same month last year.