On Jan. 12, the San Antonio Apartment Association held a virtual State of the Industry meeting discussing how San Antonio compares to other major cities across the country.
Will McIntosh, global head of research for USAA Real Estate, began the program by analyzing the growth data and economics for the San Antonio area.
According to McIntosh, San Antonio ranked No. 9 in the nation for population growth over the last 10 years, increasing by 18.1%.
From Quarter 4 of 2019 to Quarter 3 of 2021, the leisure and hospitality industry in San Antonio saw an employment change of -10.9%.
Despite this decrease, McIntosh believes that 2022 will be a better year for the industry depending on the effect of COVID-19 variants.
“We know now that the situation is improving significantly, but we certainly can see that we took a pretty hard hit during the pandemic,” McIntosh said.
According to McIntosh, the housing starts demand for both single-family and multifamily homes have been increasing.
“As these housing units continue to get absorbed, even if single-family starts growth, there remains a critical shortage of single-family housing,” McIntosh said. “Not only in the San Antonio market, but in the country, which continues to support the demand for apartments.”
Bruce McClenny, president of Apartmentdata.com, discussed rent within San Antonio and the absorption, or effectiveness of how occupancy increases, from 2007-21.
“The worst was in 2009, when we had the Great Recession, so rent growth in 2009 was 0.9%,” McClenny said. “But otherwise, you can see that it is kind of in a zone. We had years that it would go up, in ‘11 and ‘15 it would go up to the 4s and the 5 levels, but overall it stays around the 2s and 3s and stays very steady.”
In 2021, the rent growth reached 18.2%, which dwarfs the 2020 growth of 1%. 2021 also had an absorption of 11,492 compared to the 2020 absorption of 6,688, meaning there was a larger housing demand and properties were more likely to sell than in previous years.
According to McClenny, the reason for this change is due to the reopening of jobs, single-family housing problems and immigration from the East and West coasts to Texas.
Mark Carmona, chief housing officer for the city of San Antonio, served as a panelist during the event, discussing concerns and hopes for the housing market in 2022.
“I am concerned about supply line and effective on-unit availability,” Carmona said. “You know, labor as well as materials costs moving forward because from an affordability standpoint, we really are looking at new development.”
Despite these concerns, Carmona feels that 2022 will have opportunities, including the upcoming vote for the 2022 bond program proposed by the city of San Antonio.
According to the city of San Antonio, the purpose of the housing potion of the bond is to provide affordable housing opportunities through production, preservation and housing assistance that targets the most vulnerable households, which are identified in the Housing Policy Framework and Strategic Housing Implementation Plan laid out by the city.
“We are moving toward hopefully the successful passage of the 2022 housing bond,” Carmona said. “It is historic. It is the first time in our community that we will have something like this.”
More information on the bond can be found here.