As the New Year starts to unfold, optimism seizes the San Antonio real estate market, as industry professionals and buyers alike anticipate a brighter horizon for 2024's home purchasing landscape. Despite the fact that the previous year was marred by challenging conditions, heightened interest rates, and a reduction in inventory, there is a widespread sentiment that the tides are about to turn, tailoring a market more favorable to buyers. Timothy O’Grady, who recently bought a house in the city, told FOX San Antonio, "Now is the time, even though with interest rates and everything, we just knew now is the time."
The San Antonio Board of Realtors reported that sales dropped by 4% in November 2023 compared to the same month in the year prior, reflecting the impact of the higher interest rates that forced many homeowners to hold onto their lower rates – further squeezing the available housing stock. Realtor Maricela Mares Castillo, in a statement obtained by FOX San Antonio, projects that 2024 is set to be much improved, suggesting, "People are still buying, people are still selling, the only better time to buy was yesterday, second best time is today you just need someone to sit with and have someone explain to you all your options and there are a lot of options."
However, amidst the general sales decline last year, not all tendencies inclined downwards, with new home sales witnessing a substantial increase of 27%, coined partly to attractive builder incentives, according to a San Antonio Report. This trend highlighted buyer adaptation to the market's constraints, with existing home sales seeing a 17% fall in the same period. The staggering shift included San Antonio median home prices hovering below the $300,000 mark in Bexar County – a price competitively lower than other major Texan metropolitan areas.
Certain price brackets have managed to defy wider market trends, as evidenced by the robust activity in the high-end sector, where homes priced $1 million and upward have reported sales gains. "They're not injured right now. They're not concerned because they're going to have higher down payments, they're going to have better access to better interest rates," or they can pay with cash, Gary Ard told the San Antonio Report. Such dynamics underscore a divergence in market experiences, dependent largely on buyer profiles and resource availability.
Looking ahead, the Federal Reserve's monetary policy remains a significant factor, with Ard and other experts like Texas A&M University economist James Gaines expressing hope for reduced interest rates in the near future. According to the San Antonio Report, Gaines has predicted that after a sluggish start, the housing market is set to "pick up steam when interest rates moderate or decline". This together with Texas' strong employment and demographic growth points to 2024 being a year where the San Antonio real estate market can expect to maintain, if not enhance, its footing – with a caveat of continued low inventory of both existing and new homes, positioning the city for a potentially promising time for home buyers.
