In the ever-evolving San Antonio housing market, staying up-to-date with the latest trends and market conditions is crucial for both buyers and sellers. By partnering with experienced agents and understanding the data, you can make informed decisions that align with your goals.
The real estate market in San Antonio is showing signs of resiliency in spite of a 4% year-over-year decrease in closed sales, according to the San Antonio Board of REALTORS® (SABoR) August 2023 Housing Market Report. The region also witnessed a 2% month-over-month increase in closed sales, indicating continued buyer confidence. Housing inventory is gradually improving, with a year-over-year increase of 1 month and a slight month-over-month increase of 0.1 months, now at 3.9 months of supply. This shift in the market allows potential homebuyers, especially first-timers, to be more selective in their choices as housing inventory increases across Central Texas.
Let's start by looking at the important points from August 2023:
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The number of homes for sale increased by 24% compared to the previous year and grew by 4% from last month.
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The average days a home stays on the market decreased by 1 day from the previous month, now at 56 days, but it’s 26 days longer than a year ago.
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The number of new listings entering the market decreased by less than 1% compared to the previous year and increased by 7% from last month.
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Homes under contract fell by 21% compared to last year, and the demand from buyers increased by 1% compared to last month.
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Home sales decreased by 4% compared to the previous year and increased by 2% from the previous month.
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The number of available homes in August increased slightly from the previous month, at 3.9 months, compared to a 2.9-month supply a year ago.
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The median home sale price decreased by 1% compared to the previous year, now at $322K. This is a 0.2% decrease from the last month.
- Right now, there are over 11,000 homes for sale, and more than 3,000 homes have lowered their price in the last month.
Source: San Antonio Board of REALTORS®, All MLS.
Understanding the San Antonio Real Estate Market Shift
The burning question on the minds of real estate professionals and consumers alike for the past 18 months: In which direction is the real estate market headed?
“The market continues to favor sellers, with 3.9 months of inventory, suggesting a competitive environment for buyers. While the YoY decrease in total sales and increased days on the market suggest a market in transition, the stability in average and median prices indicates a balanced environment that continues to provide opportunities for real estate investors and homeowners alike,” said Sara Briseño Gerrish, SABOR's 2023 Chair of the Board.
Affordability & Housing Supply
With the median home price decreasing to $322k this month, it underscores San Antonio’s affordability and stability compared to other areas in Central Texas. The current number of homes for sale has increased by 24% since this time last year, which indicates sellers have the confidence to move and are giving buyers more options to choose from.
“With expected changes in mortgage rates before the year's end, both buyers and sellers are advised to stay informed about the market's evolving factors to make informed decisions. It's crucial to consult with an agent for guidance, as the San Antonio market demonstrates activity and resilience with increased inventory and lower median home prices," said Marisa Jackson, Agent Success Manager at Realty San Antonio.
Pro Tip: If you’re a potential first-time home buyer, explore our guides on qualifying for a home loan, essential questions to ask, overcoming down payment myths and affordability resources to get started.
Demand Shift Towards New Construction
Higher mortgage rates, population growth, and not enough homes available in the price range that people can afford have led to a surge in demand for new construction. According to the SABoR’s August 2023 Market Report, more than 35% of people buying homes are choosing new construction in San Antonio within the last year, with over 11,000 homes in the construction pipeline as of August 2023 through 2024.
Revisions in Expert Home Price Predictions for 2023
Last year, there were many headlines that foretold a significant home price plunge in 2023, reigniting worries of a housing crash akin to the one in 2008. However, reality painted a different picture. While there was a correction following the remarkable price surge in 2021 and 2022, home prices didn't fall as much as everyone feared.
In San Antonio, for instance, median home prices reached their lowest point in January of this year at $308K, however, this was a year-over-year appreciation of 3%. Since the beginning of this year, home prices have continued to make their comeback increasing by 4% as of August.
“Looking ahead, it's important to recognize that seasonal fluctuations will influence home price appreciation in the coming months, with prices likely to slow as the housing market seasonally cools toward year-end. However, this slowdown shouldn't be confused with a price decline; it's merely a deceleration of appreciation,” said Marisa Jackson, Agent Success Manager at Realty San Antonio.
Homeowners are enjoying significant equity growth. In San Antonio, residents have witnessed a notable 35% increase in equity since August 2019. Experts now predict home prices to remain stable or even show positive growth by year-end and will continue to go up every year through 2027, according to the latest Home Price Expectation Survey, increasing equity for current homeowners even more.
“In Texas, homes typically appreciate 5% annually, so if you’re planning to buy or sell a home, one thing to consider is what home prices will do in the future and how that might impact your investment. It’s important to remember home price appreciation is cumulative. Owning a home is an investment that builds household wealth over time,” said Marisa Jackson, Agent Success Manager at Realty San Antonio.
Evolving Market Dynamics
The current imbalance between supply and demand has affected home prices, which are still rebounding but at a slower pace in 2023. More inventory is needed to reach a balanced market, and with the 'locked-in effect' of lower mortgage rates, sellers are holding back, preventing a needed increase in supply.
Pro Tip: Explore different mortgage strategies including rate buydowns to achieve your real estate goals.
“The good news is that the feared ‘housing bubble’ has not burst, as many worried it might. Instead, the market has found a delicate balance between supply and demand. We are seeing a bump in inventory which means that sellers with lower mortgage rates are showing confidence in the market,” said John Coake, Head of Sales at Realty San Antonio.
To navigate the market accurately, it's wise to connect with a trusted real estate agent who can provide reliable data and help you separate fact from fiction. Whether you're in the market to buy or sell, having a strong understanding of the most recent trends and market conditions gives you the knowledge to make well-considered decisions. Start your real estate journey and achieve your objectives with the guidance of a local professional. Feel free to get in touch at 210-361-6000 or email realtor@realtysanantonio.com.
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