average rent
average occupancy rate
ytd sales volume
YoY rent change
yoy occupancy change
individual transactions
QUARTERLY DEMAND
YTD: 1,149
QUARTERLY COMPLETIONS
YTD: 3,080
Average Monthly Mortgage Payment*
* The Average mortgage payment is based off a median home sales price of $324750 as reported by the San Antonio Association of Realtors as of May 2023.
Average Monthly Rent
As the second quarter of 2023 unfolded, the apartment market in the San Antonio-New Braunfels region found itself wrestling with a minor decrease in occupancy levels. The market’s occupancy rate descended to 92.3%, marking a 20-basis point fall from the preceding quarter. This marginal downward shift, however, did not paint the whole picture of the complex dynamics at play within this diverse market.
Zooming into the submarket level provides a lens through which to view the dynamic trends shaping the San Antonio-New Braunfels apartment market. Far North Central San Antonio and Central San Antonio emerged as leaders in the occupancy this quarter. This hints at a renter preference for the heart of San Antonio, likely driven by the convenience of being in close proximity to essential amenities and employers. In the case of Far North Central San Antonio, its strong occupancy rate could also reflect its strategic positioning between San Antonio and Austin, offering tenants the best of both vibrant cities.
Over the last five years, the San Antonio-New Braunfels region has experienced dramatic shifts in rent growth, ranging from a 1.0% decline to a 16.1% upswing. As the second quarter drew to a close, rents for new leases rose by a modest 0.4%, trailing behind the market’s five-year average annual increase of 4.9%. Amid the influx of new apartment stock, rent growth for Class A units stagnated, recording a zero percent change year-over-year, as operators prioritize maintain occupancy in the current climate. In contrast, the more budget-friendly Class C sector demonstrated a 3.0% increase, marking the third quarter in a row this segment has outperformed its Class A and B counterparts.
Examining San Antonio’s submarkets, Northeast and West San Antonio led the pack in rent change over the past year, recording increases of 3.5% and 3.0%, respectively. In stark contrast, the Far Northwest submarket experienced a rent contraction of 2.9% in the second quarter.
| Submarket | Average Occupancy | Annual Occupancy Change | Average Monthly Rent | Annual Rent Change |
|---|---|---|---|---|
| Central San Antonio | 93.5% | -1.5% | $1,518 | 0.3% |
| Alamo Heights | 92.4% | -3.7% | $1,493 | -0.9% |
| South San Antonio | 91.5% | -3.1% | $1,107 | 1.9% |
| Southwest San Antonio | 90.5% | -4.5% | $1,098 | -0.1% |
| West San Antonio | 92.0% | -3.3% | $1,030 | 3.0% |
| Medical Center | 91.4% | -4.0% | $1,165 | 1.3% |
| Northwest San Antonio | 92.1% | -3.2% | $1,182 | 1.5% |
| Airport Area | 91.9% | -3.1% | $1,120 | 0.7% |
| North Central San Antonio | 92.9% | -3.6% | $1,289 | 0.0% |
| Northeast San Antonio | 92.2% | -3.8% | $1,141 | 3.5% |
| Far West San Antonio | 92.5% | -3.1% | $1,306 | -1.0% |
| Far Northwest San Antonio | 92.6% | -2.8% | $1,485 | -2.9% |
| Far North Central San Antonio | 93.6% | -2.8% | $1,487 | 1.3% |
| New Braunfels/Schertz/Universal City | 92.7% | -3.7% | $1,347 | 0.3% |
Units Under Construction
Units UC Delivering In the Next 4 Quarters
So far this year, the San Antonio-New Braunfels market has seen the transaction volume for individual multifamily property sales dramatically contract to about $473.4 million, a sizable reduction representing a 73% YoY decline. At the same time, the number of transactions has seen a reduction of 46 compared to the same period last year, with only 18 apartment properties changing hands since January. Despite these downward trends, unit prices have witnessed a 20% annual hike, reaching around $157,500. However, this figure falls below the average prices in the South region ($202,600) and the U.S. ($225,200), suggesting potential investment opportunities in San Antonio-New Braunfels due to its relative affordability.
* Trailing 4Q average PPU
* Preliminary Data from RCA – Individual transaction $2.5M +
According to preliminary data from the Bureau of Labor Statistics, the unemployment rate in St. Louis was 3.0% in May, below the U.S. average of 3.5%. Over the course of the previous year, employment in the metro expanded by 1.4%, equating to an increase of 18,500 positions. The leisure and hospitality sector witnessed the most significant growth, adding 10,800 new jobs, a rise of 7.5%. This was closely followed by the education and health services sector, which added 5,300 new roles.
May Annual Jobs Created
May 23 Employment growth
May 23 Unemployment rate
3.4% us may rate
Change from May 2022
to May 2023: 10,800
Percent Change: 7.5%
Change from May 2022
to May 2023: 5,300
Percent Change: 2.0%
Change from May 2022
to May 2023: 2,700
Percent Change: 2.3%
Change from May 2022
to May 2023: 2,500
Percent Change: 1.6%
Change from May 2022
to May 2023: 2,300
Percent Change: 1.0%
| Sector | Change from May 2022 to May 2023 | Percent Change |
|---|---|---|
| Leisure and hospitality | 10,800 | 7.5% |
| Education and health services | 5,300 | 2.0% |
| Manufacturing | 2,700 | 2.3% |
| Government | 2,500 | 1.6% |
| Professional and business services | 2,300 | 1.0% |
| Other services | 1,500 | 2.8% |
| Trade, transportation, and utilities | 400 | 0.2% |
| Information | -400 | -1.4% |
| Financial activities | -1,500 | -1.5% |
| Mining, logging, and construction | -5,100 | -6.8% |
As of May 2023, the San Antonio region showcased impressive labor market resilience, as per data from the Bureau of Labor Statistics (BLS). Total nonfarm employment reached an impressive count of 1.17 million jobs, translating to a robust year-on-year growth of 4.6%. Various sectors contributed to this growth. The leisure and hospitality sector led the way, adding nearly 11,000 new jobs. Following closely was the professional and business services sector, with an additional 7,200 new jobs. Other significant job growth contributors included the government sector, growing at 4.4%, and the trade, transportation, and utilities sector, which expanded by 3.3%. San Antonio’s unemployment rate in May 2023 stood at 3.8%, slightly above the national average of 3.4%. Nonetheless, with consistent growth across all job sectors, the city continues to exemplify a robust and thriving economy.
May Annual Jobs Created
May 23 Employment growth
May 23 Unemployment rate
3.4% us may rate
| Sector | Change from May 2022 to May 2023 | Percent Change |
|---|---|---|
| Leisure and hospitality | 10,900 | 8.0% |
| Government | 7,700 | 4.4% |
| Professional and business services | 7,200 | 4.5% |
| Trade, transportation, and utilities | 6,600 | 3.3% |
| Education and health services | 6,400 | 3.8% |
| Financial activities | 5,300 | 5.4% |
| Other services | 2,000 | 5.2% |
| Manufacturing | 1,100 | 1.9% |
| Mining, logging, and construction | 700 | 10.8% |
| Information | 700 | 3.8% |
The San Antonio apartment market could face some headwinds as cooling demand in the short term may present challenges. Despite this, the city’s stable employment foundation across various sectors such as healthcare, government, military, and aerospace manufacturing is expected to soften any major impacts. For the remainder of 2023, the market is projected to experience a slowdown in both occupancy and rent change. However, these metrics are expected to gradually stabilize, aligning closer to long-term averages by 2024 and beyond. Notably, occupancy rates in San Antonio have traditionally been lower than the national average, a trend that is anticipated to persist in the forecast outlook. This lag underscores the unique dynamics of the local market and the need for tailored strategies for real estate investors operating in the region.
