SAN ANTONIO — Record low supply, dozens of offers on a single home, people moving to Texas from out of state, and investors paying all cash to snap up house are all factors leading to a hot and competitive real estate market in San Antonio.
In this episode of Commerce Street, a business podcast from KENS 5, we hear from real estate professionals about the market for buyers, sellers, and people who might want to buy a home some day.
The pandemic led to a lot of cross country moves for companies and homeowners, driving up demand and prices. But realtors are not driving people off the house hunt just yet.
One of the experts who spoke to KENS 5 is Phillip Lopez, of the Lopez Group within Keller Williams City View. Part of his job is give his clients consultations about current market conditions so they understand exactly what they are getting into when they start their search for a home.
"Inventory is at an all-time low right now. So we're having to get creative and pivot a little bit as far as like how we're finding properties for for buyers as well as sellers," Lopez said. "What's happening right now is many people are not wanting to make that move because they can't find that property that they want to move into."
He says right now, he and his team are digging deep to match people with the right property.
"We have a group of what we call the 'inside sales agents' that help find off market properties for our clients. And so we're essentially door knocking, making those calls around neighborhoods to see who might be interested in looking to make a move....just doing our best to kind of create that inventory."
Lopez said that record low supply of homes is astonishing considering the size of the San Antonio area.
"There's only about about 2,000 homes on the market right now in this county," Lopez said. "We're actually, as you know, the seventh largest city in the nation. And so we've got over a million people with only 2,000 homes on the market. We're at a less than a month supply right where the average norm is supposed to at six months [supply]."
Cher Miculka, Chairman of the San Antonio Board of Realtors (SABOR) spoke to KENS 5 about the role her organization plays in educating buyers and sellers about the best real estate strategies.
"Usually buying a house might be one of the largest investments anyone makes," Miculka said. "So you want to be sure you get yourself with a realtor that helps guide you and educate you on what is going on and all the transactions and what you can expect from inspections to appraisals to financing to just holding your hand through every step of the way. That's our goal. That's our mission. And I think we work really hard to try and do a very good job."
Miculka's organization also tracks trends and puts together market reports on San Antonio and surrounding areas. She talked about what she is seeing and hearing about the San Antonio housing market this year.
"We're on the up and up and up and up . I can just give you an example. The average sales price just from last year to this year, even with COVID, even with all that going on, in the San Antonio area specifically has risen 15 percent," Maculka said. "Price per square foot....I know people are a little concerned about that. Again, from last year to this year in San Antonio, a 15 percent increase and in Bexar County, about 13.9 percent [increase]."
She also talked about the balance between rising sales prices and affordability, saying that while some would celebrate the rising prices, realtors do actually need most people to still be able to afford to buy a house. Otherwise, you do not have a consumer base.
"Real estate, though, does go in cycles. So we're up right now. We're hoping we don't go down too much in that respect," Miculka said. "We still want, though, affordability for the consumer. And I just say, be grateful you live in San Antonio, because right now we are still one of the most affordable places to be."
One of the big reasons that demand, and thus rising prices, is so high is people from the West Coast moving to Texas despite the pandemic. And, Lopez says, there are many reasons for that.
"With for our team specifically, we're seeing probably about three to five buyers come in from California every single week. And then also agents [from California] that call us and 'say, hey, we have people'. There's like a mass exodus happening here," Lopez said. "Because we started getting such a large amount of people contacting us and saying they're moving from the West Coast, we started taking a survey and asking, 'you know, what are these reasons?' Cost of living is probably number one. And then two is the political climate. And then three, it's probably the jobs coming to to Texas. A lot of tech companies coming to Austin...Austin is even in a crazier market. We're starting to see that shift downwards here to San Antonio. I would say there's just so many buyers right now that everybody's chasing the same home. Right. Like as soon as it hits the market, we're seeing probably 10 to 15 offers at a time with up to 60 showings in two days. And so the other thing is that the everyone from California coming are coming with cash. And so it's causing a little bit of an issue with our Texans."
Both Lopez and Miculka agreed that despite the challenges of low supply and rising prices, they do not recommend waiting to buy if you are ready now.
"Oh, no, don't wait, because right now you still have buying power with the interest rates being low. And even though I know we're in a very competitive market right now, the good news is we have low inventory right now. And that's part of what's pushing this, that and a lot of people have decided to maybe refinance or stay in their home. And that's contributed a little bit to the low inventory. But we're in the listings selling season normally April, May and June. That's when people begin to say the sun is shining, flowers are growing," Miculka said. "Historical data shows that the inventory should start increasing and we are seeing more houses become available, and that's going to help us a lot."
"I would say it's a great time. And the reason why it's a great time still to buy is that interest rates are still at an all time low. So we might not ever see this again," Lopez said. "And there's still there's still inventory out there to purchase at at a good price. I would not shy away from purchasing a home or wait too long because we don't know what the things look like, maybe even next year."
With such a hot real estate market across Texas and the U.S., stories of people getting creative to stand out in their offers have become common. We asked Lopez what specific advice he had to make your offer rise to the top when you are competing with several others.
"I think some of the things that we're seeing that we're having to do is maybe like waiving appraisal appraisal. So we might have to have a little bit more cash in case the the home price that we offer comes in a little bit under," Lopez said. "Sometimes we're waiving what we call the option period, which is your period to be able to get your home inspection and any other due diligence. Having your preapproval letter also ready to go is going to be huge. And if you can shorten the closing time as well, that always helps because a lot of people that come in with cash, they can shorten the close."
The surge in house prices are even affecting people who are not in the market to buy and plan to stay in their homes long-term. Property tax values are on the rise as well, hitting Bexar County residents with higher tax bills.
"I'll just use my house, for example. I just got my tax bill right from the city and it jumped up almost $40,000," Lopez said. "So one of the things that we're doing is, we're reaching out, for our team specifically, we're calling our database, meaning our past clients and talking to them as like, 'hey, let us know if you need help pulling comps or fighting your tax bill.' Because there are some people that do want to stay in their home, but now they're seeing these huge jumps and their tax bill. Right. It typically takes about six to nine months worth of comparables as far as the city goes. So we're helping them come up with creative ways to help present those to the city and saying, 'hey, you know, my home doesn't look like the fully renovated home that you see across the street. Why am I getting an increase of $40,000?'"