Rent, home values on the rise in S.A.
Rents and home values are ticking up in San Antonio, though housing here still is more affordable than in other large cities in Texas, a report by Zillow shows.
Median monthly rents in the area have risen 4 percent since June 2018 to $1,388, the real-estate listings company noted. That’s compared with 3 percent nationally, or $1,483, along with $1,737 in Austin, $1,588 in Houston and $1,661 in Dallas-Fort Worth.
The jump comes after rents across the U.S. dropped last year in part because more units were built in urban areas, said Skylar Olsen, Zillow’s director of economic research and the report’s author. But that inventory was snapped up and affordable apartments increasingly are hard to come by.
“As much as record numbers of new apartments led many to believe that rental markets might have become over-saturated with new supply, the reality is that demographics and general economic health continue to keep the pressure on,” he said.
“What the rental market still craves are affordable units spread across the landscape,” Olsen added. “Show me a three-bedroom apartment in a small building located near good schools, and I'll
show you an older millennial with kids ready to move in.”
Meanwhile, median home values in San Antonio rose 5.3 percent in the same period, and 5.2 percent nationwide. That’s a slowdown from an 8.1 percent jump nationwide in January, Olsen said, but “still a healthy pace that is well-above historic averages.”
The typical U.S. home is worth $227,700, Zillow reports. The median home value in San Antonio was $194,900 in June, compared with $311,800 in Austin, $205,700 in Houston and $242,900 in Dallas-Fort Worth.
“Prices have been going up, but it’s starting to level off,” said Jim Gaines, chief economist at the Texas A&M Real Estate Center. “San Antonio will probably continue to be a lower-cost housing market than Dallas, Austin or Houston.”
Rising population and employment are fueling the cost increase, he said. The market is cyclical, with prices generally going up in the summer, easing off in the winter and rising again in the spring.
Inventory is also tight, and San Antonio along with other big U.S. cities are grappling with a shortage of affordable housing. It’s difficult for builders to develop lower-end housing unless they construct it farther away from downtown areas on cheaper land, Gaines said, and so many of the new apartments come with higher rents.
“That is a growing concern in all of our communities here in Texas,” he said.