Hello, Alamo City! Here’s your monthly snapshot of the San Antonio real estate scene!
Last month, I described the San Antonio housing market as stuck. Buyers weren’t buying, sellers weren’t selling, and just about everyone seemed content to sit on the sidelines.
September’s numbers suggest that not much has changed. If anything, things have gotten a little tougher.
Home prices declined across most reporting sources. Houses took longer to sell. Sales volume dropped another 10%, and inventory remains elevated.
None of those developments are particularly encouraging for someone trying to sell a house.
But there’s another factor we need to consider.
We’re heading into what is traditionally the slowest part of the real estate year.
As we move toward Thanksgiving and Christmas, fewer people want to deal with buying, selling, packing, or moving. Families are settled into the school year, holiday schedules get busy, and many buyers simply decide to wait until after the new year.
This happens every year, even in relatively healthy housing markets.
The difference this year is that we’re entering the seasonal slowdown with a market that was already struggling.
So while September’s numbers aren’t particularly encouraging, we need to be careful about assuming every decline represents a worsening housing market.
Some of this is likely normal seasonality.
The bigger question is how much.
There is also some encouraging news developing in the rental market. After years of excessive apartment construction, the development pipeline has slowed dramatically. It won’t help much this winter, but it could set the stage for a healthier rental market in 2027 and 2028.
Let’s look at the numbers.
Single-Family Home Prices: Mostly Lower in September
Three of the four major reporting sources showed lower home prices in September. SABOR was the only exception.
Median Price Snapshot
- Redfin: $257,377, down from $264,825
- Realtor.com: $282,971, down from $284,102
- Zillow: $244,623, down from $247,453
- SABOR: $302,999, up from $299,275
Redfin reported the largest decline at approximately 2.8%. Zillow fell 1.1%, while Realtor.com declined a modest 0.4%.
SABOR moved in the opposite direction, increasing approximately 1.2%.
My Take
The pricing data continues to show a market under pressure, but I’m not convinced September represents a significant change in direction.
Home prices frequently soften as we move out of the summer selling season. Fewer buyers are actively shopping, and sellers who still have their properties listed may become more willing to negotiate.
That’s particularly true heading into the holidays.
A homeowner who has been trying to sell since June may not want to carry that property into the new year.
But I also wouldn’t dismiss these declines as purely seasonal.
For several months, I’ve heard the same complaints from agents and investors. Houses are sitting, showings are limited, and price reductions aren’t generating much additional interest.
September’s numbers are consistent with those experiences.
SABOR’s modest increase is interesting, but median prices can move around depending on the mix of homes sold during a particular month.
I wouldn’t interpret that increase as evidence that the market is improving, just as I wouldn’t interpret Redfin’s decline as evidence of a housing crash.
For now, I think the most reasonable conclusion is that prices remain under pressure, and the seasonal slowdown probably isn’t going to help. I expect the housing price to fall an additional 3 to 7% between now and the end of January.
Days on Market: Houses Are Taking Even Longer to Sell
September’s days-on-market numbers were particularly weak.
All four major sources reported that houses are taking longer to sell.
Days on Market
- Redfin: 64 days, up from 58
- Realtor.com: 67 days, up from 64
- Zillow: 49 days, up from 41
- SABOR: 88 days, up from 82
Zillow saw the largest increase at eight days, followed by Redfin and SABOR at six days each.
My Take
These numbers line up with what I’ve been hearing from people actively trying to sell houses.
Properties are sitting longer, showing activity is limited, and buyers don’t seem particularly motivated to make decisions.
But again, we need to consider the calendar.
We’re entering a period when buyer activity normally slows down. Many families prefer not to move during the school year, and the holidays give people another reason to postpone major decisions.
The recent trend does show how quickly the market has slowed.
Zillow’s days on market increased from 36 in July to 41 in August and 49 in September.
That’s an additional 13 days in just two months.
Some of that may be seasonal, but the increase is still worth paying attention to.
My expectation is that days on market will probably continue increasing as we approach the end of the year.
That wouldn’t necessarily mean the market is falling apart.
It may simply mean we’re experiencing the normal winter slowdown on top of an already weak market.
Listing Performance: Buyers Continue to Have the Advantage
September’s listing-performance numbers showed sellers giving up a little more ground.
Listing Performance
- Redfin sale-to-list ratio: 96.9%, down slightly from 97%
- Zillow homes selling below asking: 58.9%, up from 58%
- Zillow sale price as a percentage of list price: 98.7%, down from 98.8%
- SABOR close-to-original-list ratio: 92.4%, down from 92.8%
My Take
The changes aren’t dramatic, but they reinforce what we’ve been seeing for months: buyers have the upper hand.
Nearly 59% of homes in Zillow’s data sold below asking price, while SABOR’s close-to-original-list ratio fell to 92.4%. For a home originally listed at $300,000, that translates to a selling price of approximately $277,200—a difference of nearly $23,000.
As we approach Christmas, I expect motivated sellers to become more flexible, while those who don’t need to sell may simply take their homes off the market until spring.
That could create opportunities for buyers and investors. For sellers, pricing realistically from the beginning will be more important than ever.
Sales Activity: A Sharp Decline, But Seasonality Matters
SABOR reported 2,793 homes sold in September, down from 3,104 in August.
That’s a decline of approximately 10%.
August was already down 6.7% from July.
On the surface, those aren’t particularly encouraging numbers.
My Take
This is where I think we need to be especially careful about drawing conclusions.
Housing sales normally decline as summer ends.
Families want to get settled before school starts, and fewer people are interested in moving as the holidays approach.
September is also when many transactions that would have closed during the busier summer season are already behind us.
So a decline in sales isn’t necessarily surprising.
I expect sales volume to remain relatively low for the rest of 2026.
But I wouldn’t necessarily interpret additional declines in October, November, or December as evidence that the market is deteriorating.
The more meaningful test will come when buyers traditionally return in the spring.
Inventory: Still Plenty of Houses to Choose From
Inventory numbers were mixed in September.
SABOR reported a modest increase, while Zillow and Realtor.com showed slight declines.
Active Listings
- SABOR: 17,155, up from 16,940
- Realtor.com: 14,647, down from 14,722
- Zillow: 8,526, down from 8,607
SABOR inventory increased approximately 1.3%.
SABOR months of inventory also moved higher, from 5.87 months in August to 5.95 months in September.
My Take
The biggest issue isn’t whether inventory increased or decreased slightly during September.
It’s that buyers still have plenty of houses to choose from.
Nearly six months of inventory represents a very different environment from the competitive market we experienced just a few years ago.
And as we move closer to the holidays, I wouldn’t be surprised to see active listings decline.
That doesn’t necessarily mean demand is improving.
Some sellers may decide they’re tired of keeping their houses ready for showings and take them off the market until January or February.
Others may simply wait until spring to list.
At the same time, the homes that remain available may face even less buyer activity.
That can create an interesting situation.
Inventory may decline, but the remaining sellers could still have a difficult time finding buyers.
Mortgage Rate Watch: Affordability Remains a Major Obstacle
Higher mortgage rates have been one of the biggest challenges facing the housing market.
September’s supplied mortgage-rate data shows another significant move in the wrong direction.
30-Year Mortgage Rates
- August: 6.76%
- September: 7.28%
That’s an increase of 0.52 percentage points.
My Take
Buyers were already struggling with affordability.
Between mortgage payments, property taxes, insurance, and maintenance, owning a home has become substantially more expensive than it was just a few years ago.
And many existing homeowners have a completely different problem.
They’re sitting on mortgages with interest rates around 3% or 4%.
Selling their current house may mean giving up inexpensive financing and replacing it with a much more expensive mortgage.
That’s not a particularly appealing proposition.
So we continue to have the same standoff.
Buyers don’t like the cost of purchasing a home, and many existing homeowners don’t want to give up their inexpensive mortgages.
I still believe a meaningful reduction in mortgage rates would help get this market moving again.
But lower rates alone may not solve every affordability problem.
At some point, home prices and monthly payments have to make sense relative to what people earn.
Until that happens, I expect affordability to remain one of the biggest obstacles facing San Antonio’s housing market.
Rental Market Snapshot: Still Weak, But There May Be Better Days Ahead
The rental market continues to be competitive, although September’s numbers showed relatively modest changes.
Rental Data
- SABOR active rentals: 5,067, up from 5,024
- Realtor.com active rentals: 6,196, down from 6,273
- SABOR median rent: $1,831, down from $1,832
- Zillow average rent: $1,381, down from $1,386
- Realtor.com average rent: $1,615, down from $1,650
My Take
The rental market continues to be competitive.
SABOR’s median rent was essentially unchanged, while Zillow reported a modest decline and Realtor.com showed a larger decrease.
Rental inventory was mixed depending on the source, but there are still plenty of properties competing for tenants.
And just like the housing sales market, rentals typically become more difficult to lease as we approach the holidays.
Most people don’t want to move during Thanksgiving or Christmas unless they have a compelling reason.
That means landlords with vacant properties may face a particularly frustrating few months.
But there is some potentially good news on the horizon.
After several years of aggressive apartment construction, San Antonio’s development pipeline has slowed dramatically.
Developers built more apartments than the market could comfortably absorb. That increased vacancy rates and forced apartment communities to compete aggressively for tenants through reduced rents and incentives such as free rent.
Now the situation is beginning to change.
According to Newmark, apartment construction starts have fallen approximately 95% from their peak, and the number of apartments under construction has declined significantly.
Even more importantly, demand for apartments has started outpacing the number of new units being delivered.
That doesn’t mean the oversupply problem has been solved.
Apartment vacancy was still approximately 14.9% during the third quarter, according to CoStar data cited in local reporting.
That’s a lot of empty apartments.
But it is an improvement from the roughly 16% vacancy rate reported earlier in the year.
And with substantially fewer new apartments expected to come onto the market in 2027, existing properties finally have an opportunity to fill those vacancies without constantly competing against another wave of new construction.
Some industry forecasts suggest San Antonio could start shifting toward a more landlord-friendly apartment market in late 2027 or 2028.
I think that’s encouraging.
For owners of single-family rentals, the benefits may take a little longer to show up.
For now, my strategy hasn’t changed.
I’d rather get a good tenant into a property at a realistic rent than leave it vacant for another month trying to squeeze out an additional $50 or $100.
One additional month of vacancy can easily wipe out an entire year’s worth of that small rent increase.
But looking beyond the next few months, I’m becoming more optimistic.
I expect the rental market to remain sluggish through the winter, with the possibility of gradual improvement during 2027.
By 2028, we could be looking at a considerably healthier rental environment if population and job growth remain reasonably strong.
For landlords who have spent the last several years competing for tenants in an oversupplied market, that would certainly be welcome news.
Looking Ahead: The Hardest Part of the Year Is Still in Front of Us
The more I look at September’s numbers, the more I think we need to keep two separate issues in mind.
First, the San Antonio housing market is genuinely weak.
Sales are slow, buyers have negotiating power, prices are under pressure, and homes are taking longer to sell.
There’s no getting around those facts.
But second, we’re entering the weakest part of the real estate calendar.
October is rarely an exciting month for residential real estate, and November and December can be even slower.
Between Thanksgiving, Christmas, school schedules, and holiday travel, buying or selling a house simply moves down the priority list for many people.
That means we could see some fairly ugly statistics over the next few months without necessarily experiencing a major deterioration in the underlying market.
I think that’s an important distinction.
Last month, I also discussed whether uncertainty surrounding November’s elections and the broader economy might be keeping some buyers and sellers on the sidelines.
I still suspect that’s playing a role.
But as we approach the end of the year, seasonality may become an equally important factor.
Even if the elections bring more clarity, I don’t expect people to suddenly start buying houses in large numbers during December.
There are simply too many other things competing for their attention.
And regardless of what happens politically, mortgage rates and affordability will remain major obstacles.
There is, however, one encouraging development worth keeping an eye on.
San Antonio’s apartment construction boom has largely come to an end, and far fewer new units are expected over the next couple of years.
That won’t do much to help someone trying to sell a house this Christmas, but it could make a meaningful difference in the rental market by late 2027 or 2028.
If apartment vacancies continue falling, we could finally see rents begin moving higher again.
That would be welcome news for landlords who have spent the last several years competing for tenants in an oversupplied market.
So Where Do I Think We’re Headed?
I expect the single-family housing market to remain sluggish through the end of 2026. Prices may soften further, homes will likely take longer to sell, and sales activity should remain weak as we head into the holidays.
Looking at last winter’s numbers, another 3%–7% decline in median prices between September and January wouldn’t surprise me. But some of that weakness is seasonal, and I wouldn’t interpret it as a sign of a housing crash.
The real test will come in spring 2027. If buyers return and sales activity improves, much of this slowdown may prove to be seasonal. If houses are still sitting with little activity, we’ll have a bigger problem.
I’m more optimistic about the rental market. The sharp decline in apartment construction should eventually help absorb excess inventory and bring supply and demand back into balance. We may start seeing improvement in 2027, with more meaningful benefits in 2028.
Final Thoughts: A Weak Market Heading Into a Weak Season
September wasn’t a great month for San Antonio real estate. Prices generally declined, homes took longer to sell, and sales volume dropped another 10%.
But we’re also entering the slowest part of the year. Thanksgiving and Christmas typically bring fewer buyers, and this year we’re heading into that slowdown with an already weak market.
For sellers, the next few months could be frustrating. For buyers and investors, motivated sellers may create some good opportunities. But with higher financing costs and longer holding times, there’s little room for mistakes.
Despite the current weakness, I’m cautiously optimistic about San Antonio’s longer-term outlook. Reduced apartment construction should eventually strengthen the rental market, while the single-family market could improve if affordability and buyer demand recover.
I expect a difficult finish to 2026, with spring 2027 being the real test for home sales. The rental market may take longer to recover, but 2028 could be a much better year for landlords.
Until then, patience and realistic expectations will matter. This isn’t a market where you can afford to get the numbers wrong.
How’s Bill’s Business Doing?
Well, I may finally be able to say that things are slowing down without immediately regretting it.
After a summer filled with tenant turnover, renovations, repairs, and more than a few headaches, things are finally starting to come together.
The good news is that we found a new tenant for our vacant duplex unit. That property had been giving us trouble for a while, and after putting more money and effort into improvements, it’s a relief to finally have someone in there. So far, I’m very happy with the new tenant.
Our fully furnished rental that we picked up in the spring is also finally finished. It actually wasn’t an awful rehab but we just had absolutely no time to get to it. But we’re done, and we’re getting quite a few inquiries from people interested in renting it. Hopefully, we’ll have someone in there soon.
Matt’s old house is also occupied. After having tenants move out almost as quickly as they moved in, it’s nice to have that property settled again.
On the less enjoyable side, we’re still dealing with the roofing contractor who took our $5,000 deposit and never performed the work. We’ve filed our small claims case and are now waiting for the constable to serve the contractor. It’s moving through the legal process, although not nearly as quickly as I’d like.
One of the bigger developments is that we finally hired another virtual assistant.
I’ve mentioned before how difficult it has become trying to keep up with the paperwork, tenant communications, repairs, and everything else that comes with managing our properties, all while working a regular 9-to-5 job.
So far, the new VA is working out well. It’s still early, but having someone to help with the administrative side of the business is already a welcome change. Hopefully, this will free up some time to focus on the things that actually need my attention.
On the acquisition side, things are pretty quiet. We don’t have any new deals on the horizon right now, and I’m perfectly fine with that.
With the housing market as slow as it is, I’m not particularly interested in chasing marginal deals just to stay busy. If something really good comes along, we’ll certainly take a look. Otherwise, I’m content to focus on the properties we already own.
Overall, business is good. We’ve worked through most of the turnover and renovation projects that kept us running all summer, our occupancy situation has improved, and we’re finally getting some breathing room.
After the last several months, a little boredom might actually be a welcome change.
Conclusion
The San Antonio housing market continues to struggle. Home prices declined across most reporting sources in September, homes took longer to sell, and sales volume dropped another 10%. Buyers remain firmly in control, with plenty of houses to choose from and little urgency to make a decision.
But before we get too pessimistic, it’s important to remember that we’re entering the slowest part of the real estate year. Activity typically declines heading into Thanksgiving and Christmas, and this year we’re starting that seasonal slowdown with an already weak market. I wouldn’t be surprised to see another 3%–7% decline in median home prices by January.
The rental market remains challenging as well, but there is some encouraging news. After years of excessive apartment construction, new development has slowed dramatically. That should give San Antonio time to absorb its excess rental inventory, potentially leading to improvement in 2027 and a stronger rental market in 2028.
As for my own business, things are finally settling down after a hectic summer. We’ve filled several vacancies, completed our fully furnished rental, and hired a virtual assistant who is helping take some of the administrative workload off my plate. We’re not seeing many new acquisition opportunities, but right now I’m perfectly happy focusing on the properties we already own.