Home Zone 8 - Southside Low interest rates keep prices strong during pandemic

Low interest rates keep prices strong during pandemic

Low interest rates keep prices strong during pandemic

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In spite of the pandemic sparked by the highly contagious COVID-19, real estate professionals report that home sales are still moving along at a steady pace across San Antonio, including on the South Side. Stock photo

South Side residential real estate, after a slight slowdown in sales during the government stay-at-home orders to limit COVID-19, are rising as mortgage interest rates dip to new lows.

Ivette Sanchez, a real estate agent with Coldwell Banker, and her colleagues in the industry have been busy, she said. With little inventory available overall, mortgage rates around 3 percent, and time on their hands, buyers are plentiful.

“We are living in a crazy market right now,” Sanchez said. “People are trying to upgrade because of the low rates and having the time to shop. One of the lenders I work with says their volume has doubled.”

The brisk market is prompting them to add five days to the standard 30 days for closing to catch up with processing all the mortgages.

What’s more, sellers who have priced their dwellings to match the real estate environment from the start are getting their asking price, often commissioning contracts in less than a week after posting a “For Sale” sign, Sanchez said.

That includes the South Side, as owners move elsewhere and their old abode becomes a first home for someone else, she added.

Neighborhoods continued to see movement in housing stock, and generally positive sale prices, according to May industry figures.

In the 78204 ZIP code, seven houses sold for an average of $203,557, a 29 percent decline from the average price of the same number of homes sold in May 2019.

For 78214, six homes were bought for an average of $159,125, up 8.5 percent from last May.

Transactions in the 78223 ZIP code gave a better snapshot of price improvements locally. There were 29 deals this May compared to 28 the same month last year. Homes sold for an average of $170,023, 15 percent more than last year. The median rose 20 percent to $177,500.

The coverage area includes Brooks’ ZIP code 78235, where there is no single-family housing. It also contains 78205, which encompasses downtown where there aren’t many single-family houses on the market. However, there were two sales downtown this May, going for an average price of $398,000 after just 51 days of availability.

There are a growing amount of apartments in the region, especially on the Brooks development and the surrounding vicinity, but specific information from the San Antonio Apartment Association wasn’t available by press time.

Citywide, apartment rental rates had been climbing for years including reaching new highs by 2020’s first quarter, according to an analysis of a national database from Apartment List/Rentometer. However, job loss associated with the pandemic, and an overall softening economy, caused a slight drop in average rates in May.

Rents declined 0.3 percent from April to May, and were virtually unchanged from last May. The median for a one-bedroom and two-bedroom unit is $856 and $1,076, respectively.

“This is the second straight month that the city has seen rent decreases after an increase in March. San Antonio’s year-over-year rent growth lags the state average of 0.6 percent, as well as the national average of 0.8 percent,” according to Apartment List.

Across the San Antonio metropolitan area in May, home sales fell 20 percent from last year to 2,869, according to the San Antonio Board of Realtors’ Multiple Listing Service Report. Yet, it’s rebounding from April, when the purchased number lowered to 2,748.

The city and county issued shelter-in-place directives in March, plus ordered the closure of nonessential businesses, to thwart the coronavirus spread. Various mandates were eased weeks later, but a surge in cases is prompting new safety measures.

May’s pending sales, many with closing dates in June, amassed 3,745, up from 2,652 at the end of April.

“This indicates that home buying and selling is still on the move, even amidst the changing times of the pandemic,” according to a statement from SABOR.

“While we saw a little downward trend this month compared to May 2019, if we’re looking at total numbers for the year, the sales numbers are only at 0.3 percent decrease, so we’re near par for year-to-date home sales,” said SABOR 2020 Chairman Kim Bragman. “Also, we are entering into June with total number of pending sales up by 20 percent, which is promising for an upward trajectory to round out the year, as we move into summer buying months.”

“We have to remember the magnitude of what we have experienced across the world and expect that we will see some numbers that change the trend, but we are optimistic when looking at the big picture that momentum will keep driving forward in the housing market,” Bragman said.

San Antonio home costs didn’t suffer despite a slight decline in sales. MLS data shows the average price in May climbed 3 percent to $281,353 and median prices swelled 2 percent to $242,400.

Find this story and more at www.localcommunitynews.com.

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