average rent
average occupancy rate
ytd sales volume
YoY rent change
yoy occupancy change
ytd individual transactions
QUARTERLY DEMAND
YTD: 1,539
QUARTERLY COMPLETIONS
YTD: 4,492
Average Monthly Mortgage Payment
Average Monthly Rent
* 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.
The San Antonio-New Braunfels market has seen a tepid apartment demand in 2023, particularly when juxtaposed with the vibrancy of preceding years. The typically buoyant 2nd and 3rd quarters didn’t align with historical vigor, and the net gain hovered at a mere 748 units in the 3rd quarter of 2023. This scenario, where supply overtakes demand, nudged the marketwide occupancy down by 0.4 points quarter-over-quarter and a more noticeable 2.4 points year-over-year, resting at 91.9% as the third quarter concluded. The occupancy scenario painted a lackluster picture across asset classes, albeit Class A properties fared relatively better with a 92.8% occupancy rate in the 3rd quarter of 2023, outshining Class B at 91.6% and Class C at 91.5%. The submarket analysis too reflected a similar pattern of weakened occupancy, with figures meandering from a low of 90.2% in Southwest San Antonio to a peak of 93.3% in New Braunfels/Schertz/Universal City.
Over the recent five-year span, the San Antonio-New Braunfels market has navigated through substantial fluctuations in rent growth, swinging between a 1.0% dip to a notable 16.1% ascent. As the curtains fell on the third quarter, the rate for new lease rents receded by 2.3% annually. Amidst the cascade of fresh apartment offerings, Class A unit rent growth hit a standstill, marking a 2.1% year-over-year descent, as operators shift their focus towards sustaining occupancy amidst the prevailing market conditions. The ripple of annual rent downswing spared no asset class, albeit the economical Class C segment weathered the storm relatively well with a mere -0.4% contraction over the year.
On delving into San Antonio’s submarket dynamics, a pervasive trend of annual rent shrinkage emerged across 13 out of 14 submarkets. Standing alone against the tide, the South San Antonio submarket registered a slender 0.6% annual uptick in rents. In a contrasting scenario, the Far Northwest submarket bore the brunt of a significant annual rent contraction, plummeting 6.0% over the year.
| Submarket | Average Occupancy | Annual Occupancy Change | Average Monthly Rent | Annual Rent Change |
|---|---|---|---|---|
| Airport Area | 91.4% | -2.5% | $1,124 | -0.4% |
| Alamo Heights | 92.2% | -2.2% | $1,485 | -1.5% |
| Central San Antonio | 92.7% | -1.1% | $1,508 | -1.1% |
| Far North Central San Antonio | 92.8% | -2.7% | $1,485 | -2.3% |
| Far Northwest San Antonio | 92.5% | -1.1% | $1,483 | -4.6% |
| Far West San Antonio | 92.1% | -2.0% | $1,271 | -6.0% |
| Medical Center | 90.9% | -3.5% | $1,161 | -1.6% |
| New Braunfels/Schertz/Universal City | 93.3% | -2.3% | $1,352 | -2.3% |
| North Central San Antonio | 93.0% | -2.8% | $1,301 | -1.7% |
| Northeast San Antonio | 91.6% | -2.5% | $1,125 | -1.2% |
| Northwest San Antonio | 91.2% | -2.9% | $1,191 | -0.4% |
| South San Antonio | 91.1% | -2.1% | $1,110 | 0.6% |
| Southwest San Antonio | 90.2% | -3.5% | $1,107 | -2.9% |
| West San Antonio | 91.4% | -1.9% | $1,030 | -1.8% |
Number of Units Under Construction
Number of Units UC Delivering In the Next 4 Quarters
Throughout the current year, the transaction landscape in the San Antonio-New Braunfels market for individual multifamily property sales has retracted, tallying at approximately $992.3 million. This figure represents a 61% year-over-year decline. Simultaneously, the frequency of transactions dwindled by 56 when compared to the same time frame from the preceding year, encapsulating 33 apartment property exchanges since the year’s onset. Despite these descending trends, the per unit prices have showcased resilience, inching up by 1.9% and clocking in around $185,000 as the third quarter wrapped up. Nonetheless, this metric trails behind the average unit prices observed both in the South region ($202,600) and on the broader U.S. canvas ($225,200). This pricing scenario potentially earmarks San Antonio-New Braunfels as a fertile ground for investment pursuits, buoyed by its comparative affordability.
*Most Active Buyers and Sellers are based on the sale volume of apartment units.
* Trailing 4Q average PPU
* Preliminary Data from RCA – Individual transaction $2.5M +
As of August 2023, the labor market in the San Antonio region demonstrates continued resilience, with a notable change in employment across various sectors according to the latest BLS data. Total non-farm employment continues to be robust. The government sector led the growth with 8,300 new jobs, marking a 4.9% increase. Following this, the education and health services sector added 6,200 jobs, a 3.6% increase, while the leisure and hospitality sector grew by 3.8%, adding 5,400 jobs. Financial activities and construction sectors also saw a positive uptick with 3,200 and 1,700 new jobs, growing by 3.2% and 2.7% respectively. The overall job market in San Antonio remains healthy, though the unemployment rate in August 2023 stood at 4.3%, a bit higher than the national average of 3.8%. The city’s diverse economic sectors continue to provide a stable employment landscape, which, coupled with a relatively lower cost of living, makes San Antonio a viable locale for a broad spectrum of the workforce. The sustained growth in most sectors reflects a balanced and adaptable economy capable of weathering the ebbs and flows inherent in a dynamic job market.
August Annual Jobs Created
August 2023 Employment growth
August 2023 Unemployment rate
3.8% us August rate
| Sector | Change from August 2022 to August 2023 | Percent Change |
|---|---|---|
| Government | 8,300 | 4.9% |
| Education and health services | 6,200 | 3.6% |
| Leisure and hospitality | 5,400 | 3.8% |
| Financial activities | 3,200 | 3.2% |
| Trade, transportation, and utilities | 1,800 | 0.9% |
| Construction | 1,700 | 2.7% |
| Other services | 1,200 | 3.0% |
| Mining & logging | 400 | 5.8% |
| Information | 400 | 2.1% |
| Manufacturing | (900) | -1.6% |
| Professional and business services | (1,500) | -0.9% |
The cost-of-living index in San Antonio, TX, stands at a modest 91.2, showcasing a market that’s more affordable relative to the national average. A significant contributor to this affordability is the housing sector, with a housing index of 78.1 and a median home sales price of $334,100, which has seen a year-over-year decrease of 4.4%. When compared to a tech hub like Austin, TX, San Antonio offers a more cost-effective living arrangement, particularly in housing, which is 29.8% less expensive. Additionally, utilities in San Antonio are 5.7% less, although transportation and health costs are slightly higher, at 4.8% and 4.6% respectively. The comparison in transportation and health costs indicates a balanced trade-off between the two Texas cities. The average mortgage payment in San Antonio stands at $2,592, as opposed to the average rent of $1,269, presenting a favorable scenario for renters. This economical landscape, coupled with the moderate cost of essential utilities, makes San Antonio an attractive option for a variety of individuals seeking affordability without significantly compromising on the quality of life, especially when compared to its pricier neighbor, Austin.
91.2
$2,592
78.1
87.3
91.5
$334,100
The “Cost of Living” index score provides a comparative assessment of the relative expense involved in maintaining a standard of living in a specific area, benchmarked against a national index score of 100.
In alignment with numerous markets across the U.S., San Antonio is forecasted to experience subdued rent growth and occupancy rates in the near term. The city’s solid employment foundation in health care, government, military, and aerospace manufacturing and repair sectors acts as a cushion against potential economic uncertainties. A notable challenge for San Antonio is the influx of new supply, with over 12,000 new units projected to enter the market in the upcoming four quarters. However, demand is anticipated to align with, or slightly surpass, this significant supply increase in the year ahead, particularly in northern suburbs like Far Northwest San Antonio and New Braunfels/Schertz/Universal City where new construction is robust. Historically, occupancy rates in San Antonio have trailed the national average, a trend expected to persist in the projected outlook. This presents some headwinds for the San Antonio apartment market, as cooling demand in the short term may pose challenges. Despite these challenges, the stable employment base across various sectors is expected to mitigate major impacts. For the remainder of 2023, a slowdown in both occupancy and rent change is projected for the market. These metrics, however, are expected to gradually stabilize, aligning closer to long-term averages by 2024 and beyond.
