When Marc and Carrie Hill started searching for a home in Windcrest last year, the listings they saw on Zillow seemed to disappear within a few hours.
“They were just going like hotcakes,” said Marc Hill, 55, who works for the U.S. Air Force’s cybersecurity division. “If we saw something, we had to go see it that day. There was no waiting until the weekend. I had to take off work.”
The couple had moved from Windcrest to the far West Side in 2019 but wanted to return to the suburban city in Northeast Bexar County. Their home sold in a flash; an investor bought it without them having to list it online.
Finding a home, however, was harder. They said they looked at “a lot of houses” and walked away from several because of problems that arose during inspections and the owners’ unwillingness to make repairs.
The Hills wound up purchasing a garden home in December for $308,000, seven houses down from the home they left in 2019. The outdoor space is xeriscaped, a draw for Carrie Hill, 57, who has multiple sclerosis and didn’t want to maintain a big yard.
“The market is unbelievable,” she said.
The San Antonio area housing market soared in 2021, turbocharged by high demand, tight inventory, low interest rates and people seeking more space or a new neighborhood as they shifted to working remotely and their children moved back home.
San Antonio ranked No. 21 among the hottest U.S. real estate markets for 2022 in an annual report by the Urban Land Institute and PricewaterhouseCoopers.
Sam Owens /San Antonio Express-News
Buyers closed on 37,332 homes last year, down 3.8 percent from record-breaking 2020 but up 8 percent from 2019 prior to the coronavirus pandemic, according to the San Antonio Board of Realtors.
The median price hit a record of $286,355 in 2021, a 14.6 percent increase from 2020 and a 23 percent increase from 2019. Higher prices are making it more difficult for people with modest budgets to find a home, particularly as the costs of rent, groceries and other expenses rise, too.
“There’s a huge disparity between what the markets are pushing and what some families can afford,” said Joel Leos, a real estate agent at Keller Williams Heritage who worked with the Hills.
Inventory in the area plummeted to 1.5 months in 2021, compared with 2.7 months in 2020 and 3.6 months in 2019.
In a market heavily tilted toward sellers, “the leverage was gone” for buyers and “you really had to have your ducks in a row relative to financing because houses were in multiple offer situations,” Leos said.
To stand out from the competition, buyers offered thousands more than the asking price, waived contingencies, paid sellers’ costs and wrote personal letters.
The pandemic exacerbated the problem of an already-limited supply of homes, said Rodeana Reynolds, a real estate agent at RE/MAX North-San Antonio.
Prospective sellers worried they wouldn’t be able to find another home to move into in a reasonable time frame last year, she said. Some who opted to stay in place decided to remodel.
Builders rushed to construct new homes, but struggled with supply chain headaches and higher labor and materials.
“Buyers had to learn to be a lot more patient,” Reynolds said. “They could not ask for the sun, moon and stars.”
There’s been buzz about more Californians flocking to the area and investors buying homes with cash. While she’s seen more of both, Reynolds said most of the transactions she worked on in 2021 involved local families using loans.
Changes wrought by the pandemic are affecting what they’re searching for — and where. Employees who can work remotely want home offices and can now move to a rural area with more acreage since they don’t have to commute to work, Reynolds said.
Lockdowns and visiting restrictions at nursing homes frightened families, who are bringing elderly parents to live with them, she said. College students are also returning home.
“Everybody’s daily lives have changed so much that their housing needs have had to adjust accordingly,” Reynolds said.
Ed and Carrie Donald, a couple in their 50s and clients of Reynolds, were pleasantly surprised by their home-buying experience last spring. They had been renting a home but chose to buy after deciding they plan to remain in San Antonio.
They quickly found a home on the far West Side near Veterans Affairs facilities, a priority for Ed, a veteran who is also a former educator. It cost a little less than $300,000, said Carrie, a retired teacher.
“The market moved very fast. That was surprising, but it was all really good,” she said. “I’ve rented my whole life so buying a house was amazingly wonderful. I didn’t know what it would be like at all, but it was a real east process.”
Another of Reynold’s clients, Darius Wayne, is still searching for a home.
The 28-year-old said he started looking on and off in 2020 but doubled down last summer. His ideal home: a three-bedroom home on the Northwest Side near Prue Road that costs between $200,000 and $250,000.
Wayne has lost out on four or five properties, in some cases because he discovered a major plumbing problem or someone else offered cash. Some homes on the market, he said, seem to be overpriced or in poor condition.
“I thought it’d be a lot easier,” he said.
Wayne lives with family members and said he’s thankful he doesn’t need to move right away.
“It’s getting more frustrating. But with my situation I have a place to live so if I lose out on a house it’s not really a big deal,” he said. “I can imagine someone else that needs a house, they need somewhere to live now — I can see that being really frustrating, because you can’t really get it.”
The frenzied market could cool slightly in 2022 as mortgage rates rise and more new homes are built, but real estate experts are still expecting strong sales and increasing prices.
Zillow ranked the San Antonio metro area the fourth hottest housing market in the nation this year and expects home values to surge 20.8 percent through November.
The National Association of Realtors also named it a top 10 “hidden gem” market for 2022, meaning that the trade group considers it undervalued and generally affordable. The association anticipates prices here to increase more this year than in other parts of the country.
Reynolds is optimistic that the supply of available homes will expand this year, but Leos isn’t expecting much change.
“More houses will come on the market, more buyers will be there to swallow them up,” Leos said. “We’re going to have a very skinny year relative to available inventory. But I do think what will change slightly is the willingness to overpay and overpay by how much.”