More Apartments in San Antonio Lead to Historic Low Occupancy Rates and Higher Incentives
Lowered Apartment Occupancy Benefits Renters
With thousands of new apartment units gracing the San Antonio real estate landscape, record-breaking low occupancy rates have become the city’s latest trend. The swift increase in availability has prompted owners and property management companies to provide more significant incentives in an attempt to bring residents back into their once bustling complexes.
Post the COVID-19 crisis, San Antonio experienced a surge in demand for apartment housing. However, with a spike in new constructions to meet the rising need, the market has reached oversaturation. Consequently, according to the San Antonio Apartment Association, occupancy rates plummeted to an all-time low of 87% by late 2023. The figure is projected to dwindle further to 84% by the end of 2024.
Affordability Dilemma
However, despite lower occupancy rates, potential residents like Bianca Pedroza find the current prices unaffordable. At 21, Pedroza is excited by the idea of moving out and living independently but feels deterred by the steep rental rates of quality housing in the city. Her plight mirrors that of many who yearn for the amenities offered by plush apartments but are staggered by the sticker shock.
“You get what you pay for. The prices are high for a reason; they come packed with amenities you won’t find in cheaper counterparts. But if the rates were to drop, I’d have the chance to live in a much nicer complex,” she expressed.
New Apartments could Mark Lower Prices
There may be a glimmer of hope on this front as the San Antonio Apartment Association forecasts the entry of approximately 17,000 new units into the market throughout 2024. This increase in availability could potentially result in more competitive rental rates.
“When jurisdictions prioritize housing, renters have greater choice and affordability,” stated a representative from the San Antonio Apartment Association.
Companies Face New Challenge
Spencer Skubik, Associate Broker with Becker Properties, opined that as more people vacate apartments, companies are faced with the challenge of crafting innovative solutions to tempt them back.
“There are pretty good incentives on offer, but the initial daunting price frightens many potential residents. Companies will now have to rethink their strategies to lure these residents back to apartment living,” Spencer underlines.