The impact of COVID-19 has not been lost on Texas' major housing markets, but its effects have varied from market to market.
Apartment listing site Abodo reports that in June, median Austin rents for one- and two-bedroom units fell 0.31 and 0.70 percent, respectively. In Houston, one-bedroom median rent prices gained 0.51 percent, while two-bedroom rents rose a significant 1.24 percent. Dallas rents were also up, with one-bedrooms rising 1.28 percent and two-bedroom rates gaining 0.83 percent.
In San Antonio, the rental picture is mixed at best. In June, one-bedroom apartment units went up a tiny 0.21 percent to a still-affordable $967. Two-bedroom units, however, fell precipitously — 1.36 percent — to a median $1,229.
These stats point to a dead stop in the San Antonio apartment market, Abodo says, reinforcing a flat trend that has been seen since January. Here's what's contributing to the trend.
In May, the City of San Antonio issued a statement reiterating that “the federal government has implemented a 120-day moratorium on evictions for any residential property that receives federal housing funds, including both public housing and mixed-income housing beginning March 27, 2020, and ending on July 24, 2020.” The moratorium on evictions, in addition to economic stimulus checks, have contributed to flattening new apartment rental demand.
This spring, landlords saw less traffic amid social distancing and stay-home orders. With Texas now seeing a significant spike in COVID-19 cases, many apartment renting prospects have decided to once again put off excursions into the rental world.
Many San Antonio property owners are now playing catchup as they try to figure out how to implement virtual apartment tours in a hurry. This may cause a lag in new rentals, as prospective tenants will likely choose checking out apartments from their couch instead of physical visits right now. And tenants who must view their new digs in person before moving in may choose to hold on signing a lease for now, Abodo says.
Other housing market trends
As CultureMap previously reported, the San Antonio housing market saw a significant 20 percent drop in home sales in May 2020 compared to the previous year.
The simple fact is that homeowners do not want big groups of people in their homes. To keep this from happening, many San Antonio homeowners that planned on selling this spring have simply removed their homes from the market. Others that were ready to sell have had second thoughts about listing them. Therefore, with less inventory, there will be fewer sales.
On the other hand, interest rates have been slashed. Qualified buyers can get a 15-year home loan for less than 3 percent, a near record-low figure. In good times, rates like this would cause a surge in home purchases, but right now, these bargains are likely just offsetting a greater downward trend for the San Antonio housing market.
COVID-19 has dampened both the San Antonio rental and housing markets, and we don't expect to see an uptick soon. Even when COVID-19 is behind us, there will be a lot of puzzle pieces to pick up for the local housing market, so Abodo expects dreary conditions to prevail.