Despite a health crisis and recession, the San Antonio housing market saw record sales last year, a trend economists say they expect to continue into the new year.
The San Antonio Board of Realtors held its annual Housing Forecast Thursday, and due to the pandemic, it was all virtual.
Sales of existing homes were up about 10% over the previous year as the industry made a strong, fast recovery after a spring dive. What’s ahead looks familiar.
“The housing sector is going to be the star, the jewel in the crown, if you will, for the economic crown for the nation, for Texas and for San Antonio,” Jim Gaines, chief economist for the Texas A&M Center for Real Estate, told the gathering of realtors.
The major driving force behind soaring sales, he said, has been and will continue to be record low mortgage rates. They have hovered at less than 3%.
The other big factor is generation Y.
“Those good ol’ millennials we’ve been talking about for eight, nine, 10 years,” Gaines said. “Well, guess what? They are in the housing market now.”
As for where people are moving, look to the suburbs. As a result of the pandemic, many people have looked to more space and backyards, especially as they’ve found they can work from home.
San Antonio could benefit from that trend if people in Austin decide they want to escape that city’s high real estate prices, according to Lawrence Yun, chief economist for National Association of Realtors.
“Some people in Austin may say, ‘knowing I don’t have to drive downtown every day, I can buy a bigger place in San Antonio and drive to Austin two days a week,’” he said.
A growing population, both economists said, means a greater need for more new home construction. Buyers already have limited inventory for shopping, which drives prices up and affordability down.