Millennials looking to buy a home should plan to skimp on coffee a little longer. Homes are getting more expensive, even in the relatively affordable San Antonio area.
There might be a silver lining, however. Inventories have started to catch up, if only slightly, with demand.
The median price of a home in August rose 16% from August of last year to $ 298,200. The average price of a home rose 19% over the same period to $ 353,662, according to figures from the San Antonio Real Estate Board (SABOR), which covers Bexar and surrounding counties.
Going back further, the median price is up 25% from August 2019, when it was $ 238,400.
“The problem is still too little inventory and too many buyers,” said Maynard “Doc” Stephens, real estate agent at Keller Williams. The recent clients he has helped buy homes have had to compete with other buyers and bid above the listing price.
However, the stock of available housing is shrinking. SABOR reported an increase of almost 16% in its stocks compared to the previous year.
“It’s exciting to see a slight increase in inventory,” said Sara Briseño Gerrish, Secretary-Treasurer of SABOR. She said there are now about 1.8 months of inventory, up from 1.6 in July.
“I’m interested to see if stocks will continue to rise over the next few months,” she said. The holiday season is generally a slack period for sales.
The growth in the new housing stock is outstripping the increase in demand, although it still has some way to catch up. Home sales are only up 2% from August 2020.
And the pace of sales was still meteoric, with homes spending an average of 24 days on the market in August compared to 55 days in the month over the past two years.
This competitive dynamic in the market, in which housing is subject to multiple offers that typically venture above the listing price, has persisted and has become an expected reality over the past year.
Stephens said that when helping a client sell a house, every now and then he gets a call from someone who lowers the price and wants the seller to cover the closing costs – “still stuck in the market. from last year”.
“I always want to call them up and ask, ‘Are you sure you want to submit this offer? “”
San Antonio is still more affordable than Texas as a whole, where the median price in August was $ 315,000, up more than 17% from a year ago. Likewise, the average price rose to $ 386,232, an increase of 17% from last year.
The market has refined considerably during the pandemic. Closures and the new availability of remote work have prompted some to seek larger lawns and more rooms. Buyers from expensive markets like Austin and the coastal states have traded their homes for better deals in San Antonio. Many are eager to secure cheaper financing as mortgage rates hover at all time lows.
Hedge funds have also become more important players on the scene, as the rapid appreciation of homes makes them more attractive as an investment opportunity. All-cash purchases have also increased as buyers attempt to differentiate themselves in the competitive market.