San Antonio posted healthy multifamily fundamentals going into the second quarter, supported by its economic recovery and robust demographic expansion. Combined with a slowing pipeline, rent growth is likely to remain elevated. Rates rose 0.7 percent on a trailing-three-month basis through March, to $1,247, while occupancy climbed 170 basis points in the 12 months ending in February, to 95.1 percent.
San Antonio unemployment improved to 4.2 percent in February, 40 basis points behind the U.S. rate, but ahead of the state (4.7 percent) and almost on par with Dallas-Fort Worth (4.1 percent). Employment expanded by 5.2 percent (69,900 jobs) in the 12 months ending in February, 50 basis points ahead of the U.S. figure. The Alamo is one of the 14 cities that have surpassed pre-pandemic employment levels, according to a Brookings Institution study. Leisure and hospitality (24,000 positions) led job gains, followed by professional and business services (13,100 jobs). Last year, the metro’s military and health-care sectors acted as primary stabilization forces against an unstable energy sector and slow-to-recover tourism industry.
Developers delivered 860 units in the first quarter of the year and had nearly 12,000 units under construction. Meanwhile, investors traded $518 million in multifamily assets, for a price per unit that rose 3.4 percent year-over-year, to $119,395.