San Antonio’s Distressing Housing Market Situation
Recent research by GoBankingRates has named San Antonio as the 4th worst housing market in the nation due to swiftly declining property values. The study revealed that increasingly fewer people are buying houses in the area, triggering a drop in property values. Over the past year, average property values in San Antonio sank by 2.23%, and over the last two years, they fell by an average of 3.48%.
High Mortgage Rates: The Culprit Behind Falling Property Values
According to Professor David Vequist at the University of the Incarnate Word, one major reason behind the fall in property buying is high interest rates currently prevalent. He noted, “With high mortgage rates, of course, that adds to the overall cost of homeownership, making it less affordable for people in the middle class.”
An Unusual Summer for the Housing Market
Spencer Skubik, an Associate Broker with Becker Properties, stated that this summer season witnessed an unusual trend. While high-priced homes sold consistently, the lower-priced ones languished longer in the market. He observed, “The first-time home buyers are being hurt the most – high interest rates are driving them out of the market.”
San Antonio’s Housing Market by the Numbers
The study noted that 31.37% of houses listed in the market have undergone a price cut, and the average price cut stands at $12,408. Indeed, several prospective home buyers feel that the cuts aren’t steep enough. As Luis Nunez, who is contemplating purchasing a home, mentioned, “I don’t think prices have dropped enough, considering the high interest rate at present.”
A Glimmer of Hope for the San Antonio Housing Market?
Experts hold the view that it’s highly likely that interest rates will see a decrease this Fall, making the American Dream of home ownership more within reach. Skubik particularly opined, “With the likelihood of the rate dropping in September and the fact that the end of the year usually experiences a real estate market slowdown, we might see a balancing out that assures a healthy and sustainable market.”
Skubik and Vequist predict a drop in rates coinciding with the Federal Reserve meeting in September. However, only time will tell if their forecasts come to fruition and help in revitalizing the San Antonio housing market.