Aug 17, 2023 - Business

Austin residents look to San Antonio for more affordable housing

Data: Zillow; Note: Origins include the entire metro area; Chart: Axios Visuals

Claudia Zepeda recently moved to San Antonio with her fiance after living in Austin for five years. The reason: Their rent was about to jump 40%, and they felt it was time to buy a house.

  • Zepeda's experience resonates with others.

What's happening: Austinites are among those most interested in moving to San Antonio.

  • Nearly 56%, of Zillow page views from outside the San Antonio area were from Austin at the beginning of this year.

Driving the news: Most pre-pandemic moves were motivated by job changes. But now housing affordability is driving relocations, experts say.

Why it matters: As residents of other, more expensive cities look for cheaper housing in San Antonio, the city is working to address mounting affordability issues for long-time residents.

  • San Antonio and surrounding areas have seen some of the highest population growth in the nation in recent years, putting pressure on the region to grow its housing stock.

The latest: San Antonio is one of three U.S. cities, along with Dallas and Orlando, most likely to have a greater long-term housing shortage as more people move here, per a recent Bank of America Institute report.

What they're saying: "It is very common for first-time homebuyers in Austin to buy in the suburbs because of affordability, but we just could not see ourselves living in the burbs just yet," Zepeda tells Axios. "So we decided to take our home search to San Antonio, and we purchased our first home last July."

  • Zepeda, who is originally from San Antonio, said she missed the city's vibrant culture. Her new home is in North Central, near U.S. 281 and Loop 1604.

By the numbers: The average San Antonio home value is about $264,000, per Zillow, far below the average home value of about $557,000 in Austin.

Zoom in: Roughly 50% of page views for San Antonio area Zillow listings are from locals, according to first-quarter Zillow data shared with Axios.

  • Of the top 10 metros where searches originate, six were from out of state.
  • Outside of Texas, Los Angeles was the top origin, followed by New York.

The intrigue: Residents of the Austin, Houston and Dallas-Fort Worth metro areas are still those looking most at a move to the Alamo City.

  • About 13% of Zillow page views from out-of-town searchers stem from Houston, and 11.4% from Dallas.

Of note: Compared to the same time last year, there hasn't been a huge shift in search traffic patterns. However, residents of Jacksonville, Florida, were among our top searchers last year, but are not included this year.

  • Among all home searchers, a slightly higher percentage are from Austin this year, compared with last year.

State of play: Economic development professionals say San Antonio's economy needs more young professionals to move here and fill jobs. They've been advertising on Instagram to entice them into a move here.

The big picture: Since 2021, there's been an exodus from high-cost tech hubs along the West Coast — including the San Francisco Bay Area and Seattle — for more affordable mountain region states and Texas, says Redfin deputy chief economist Taylor Marr.

Yes, but: "We're seeing a big pullback in migration right now," Marr tells Axios.

  • It's simply too expensive for most people to buy right now. Across the U.S., the number of Redfin users searching for homes within their metro is down 18% from a year ago, per a June report.
  • Meanwhile, the number of users surfing listings in a new area dropped 7%.

The bottom line: If people are moving now, it's in search of cheaper housing elsewhere.

What's next: Growing environmental concerns will start to influence migration patterns, though affordability will likely still be the No.1 driver, Marr predicts.

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