Many San Antonio under market value investors in San Antonio are watching prices, waiting to pick up their next deal at a lower price. We think that the San Antonio distressed property market will pick up dramatically this year, as prices continue to fall. Below is more information.
The San Antonio real estate market in 2025 is expected to experience a cooling trend, characterized by modest declines in home prices, increased inventory, and shifting market dynamics that favor buyers. Several factors, including rising interest rates, economic uncertainties, and a surplus of listings, are contributing to this slowdown. While the market is not projected to crash, a correction is anticipated following years of rapid price increases. This cooling is likely to manifest through lower home values, longer days on the market, and increased negotiating power for buyers, though the extent of the cooldown varies across different analyses.
Home price declines are a key indicator of the cooling market. Forecasts suggest a modest drop in home values, with estimates ranging from a 1.3% decrease by October 2024 to an additional 1.7% by July 2025, according to local real estate experts cited in market analyses. As of late 2024, the median home price in San Antonio was reported around $263,040 to $320,000, with some sources noting a year-over-year decline of 2.1% to 3.9%. For example, Zillow reported a typical home value of $263,040, down 2.1% from the previous year, while Redfin noted a median sale price of $250,000, down 3.9%. This downward trend is attributed to an oversupply of homes, with inventory levels rising significantly—up 28% year-over-year by the end of 2024, reaching the highest since 2017 with 10,602 homes listed. This surplus reduces seller leverage, leading to price reductions, with 31.7% of listings experiencing cuts and homes selling for about 2.21% below asking price on average.
The cooling is also evident in longer market times and reduced demand. Homes in San Antonio are taking longer to sell, averaging 60 to 85 days on the market in early 2025, compared to 59 days the previous year. This slowdown reflects cautious buyer behavior, driven by high mortgage rates, which have risen to around 6.43% for a 30-year fixed loan as of October 2024. Elevated rates increase borrowing costs, limiting purchasing power and dampening demand, particularly in a market accustomed to low rates during the pandemic boom. Additionally, economic factors such as potential tariffs and labor market shifts under new federal policies could further suppress construction and buyer activity, contributing to the cooling trend.
Despite the cooldown, San Antonio’s market remains resilient due to its affordability relative to other major U.S. cities and steady population growth. The city’s median home price is 38% lower than the national average, making it attractive for buyers and investors. However, the rental market is also cooling, with median rents dropping 7% to $1,503 by November 2024, reflecting reduced demand and an influx of new rental units. While some experts predict modest price appreciation in desirable neighborhoods like Alamo Heights, the overall outlook leans toward a buyer’s market with stable but slower growth. Investors may find opportunities in rental properties or revitalization projects, but the cooling market suggests a need for cautious, well-researched decisions in 2025.