The Texas real estate market has experienced a meteoric surge throughout the pandemic. Warm year-round weather, low tax rates, and a growing economy have led to a massive amount of people moving into Texas, and as the population continues to swell, prices are climbing. The high demand and low inventory of the state are big factors in this issue, and throughout 2021, the state’s affordability decreased. As we move towards the end of winter, the real estate market’s pace will likely pick up even further. Let’s look at some important real estate trends in Austin and San Antonio as we enter spring.
Austin Trends
Austin is the real estate market in the United States that has seen its profile rise the most in recent years. It is a vibrant and fun city with a young, growing population, and it has become one of the most important economic hubs in the state. With companies like Tesla and Apple investing heavily in the city, there is an influx of wealthy professionals moving to the city.
Austin is the fastest-growing metropolitan city in the United States, with a population surging 34% since 2010, according to Roofstock. This population growth has inevitably caused the price of a home in the city to skyrocket. The numbers are shockingly high. According to the Zillow Home Value Index, in January 2022, the average value of a home in Austin was $639,839. While this number falls below the values of other major cities in America, how much that number has increased is most alarming. The average home value in Austin increased 41.2% in the past year.
This type of increase is near unheard of, but prices have been steadily rising in Austin for some time now. 2021 just took things a step further. Austin was ranked the hottest real estate market in the United States for 2021, and that growth is only continuing. According to the same Roofstock report, home values in Austin have increased nearly 90% in the past five years, with sales prices increasing 29% in 2021 alone.
The reasons for this surge are the sustained growth of Austin’s population, combined with the low inventory. According to the Roofstock data, Austin has 0.8 months of inventory on the market, far below the standard healthy indicator of six months’ supply. This is causing real estate prices to surge dramatically.
San Antonio Trends
San Antonio’s real estate surge has been less noted by the national media than Austin’s but is still incredibly significant. San Antonio is one of Texas’ biggest cities, and while it remains a very affordable market, prices are rising across the city. 2021 was a large year of growth for San Antonio, and thus far, the growth is continuing into 2022.
According to Redfin, the median sales price for a home in San Antonio was $265,000 in January 2022. This was a 15.2% increase year-over-year. The price of homes in San Antonio has been steadily rising for years now, culminating in a 2021 that broke records throughout. According to the same Redfin report, in January of 2017, the median sales price in San Antonio was $171,900. Within five years, prices in the city have surged by nearly $100,000.
Inventory in San Antonio is also low, although the situation isn’t quite as dire as in Austin. According to a report by Norada, there is currently 1.6 months’ supply of homes available in San Antonio. This means that it is firmly a sellers’ market, as the inventory of homes is low, which drives prices up and increases competition. Still, that number was lower in mid-2021, so the housing supply has increased slightly.
San Antonio is a growing city with an emerging economy. The Norada report indicates that job growth in the region has been concentrated on sectors like tech and cybersecurity, which are high-paying industries. This is helping to bring higher budget buyers to San Antonio. Even as prices have risen dramatically in the past five years in San Antonio, it is still one of the most affordable cities in Texas and one of the major metropolitan areas in the United States with the lowest cost of living.
