DEVELOPMENT San Antonio Apartment Association forecasts U.S. recession for 2023
BY JARRETT WHITENER
McIntosh said the unemployment rate has continued to stay low, and job growth has continued to do well, but he expects to see a lag in those numbers, causing the unemployment rate to go up on the national level. “The good news is that as we move on through the year, I do believe that the Feds will start moving again to stimulate the economy and get it back going again,” he said. McIntosh said the affordability of single-family homes has decreased, which has caused apartments and other rental properties to become more attractive to buyers waiting for better interest rates. Cindi Reed, director of sales for Apartmentdata.com, said San Antonio had a new supply of 5,756 units and an absorption of -484 in 2022, which means 484 more units were vacated than the number of units occupied by new renters. The absorption is a significant decrease from 2021’s number of 11,985 and 2020’s 6,718. “We have 7,600 units planned for delivery in 2023,” she said. “This is the largest delivery since 2017 in the city. Coming off the negative absorption in 2022, we have to hope that the absorption picks up again to absorb these units, and it is all going to depend on job growth and what is going to happen with inflation and the recession, and so forth.” The top three submarkets for new units in 2022 were Hwy. 151/SeaWorld, Thousand Oaks/Stone Oak/U.S. 281 North, and New Braunfels/Seguin. Reed said expectations for 2023 are still cloudy, but experts are optimistic for the San Antonio market.
DEFINING THE RENTAL MARKET
Experts at the San Antonio Apartment Association’s state of the industry meeting Jan. 31 discussed the rental data from 2022.
At The San Antonio Apartment Association’s state of the industry on Jan. 31, San Antonio Mayor Ron Nire- nberg spoke on the efforts to provide housing for San Antonio residents and the assistance the Apartment Association provides. “The San Antonio Apartment Association is a critical partner in our efforts to provide quality housing for our residents and a foundational part to our approach to an equitable economy,” he said. Nirenberg said the rental industry collectively contributes $22.5 billion to the local economy each year. With the goal of providing afford- able housing and fighting homeless- ness, San Antonio was the first city in the country to meet rehousing goals in October, Nirenberg said. In reaching the goal under the US Housing and Urban Development’s House America Initiative, Nirenberg said about 1,900 families have been rehoused. Will McIntosh, global head of research for USAA Real Estate Group, said San Antonio has continued to grow and has been doing well com- pared to overall national data. “[San Antonio’s growth] has been driven by job growth,” McIntosh said. “It has been driven by pop- ulation growth. We are one of the fastest, or the fastest-growing city in the country.” Despite job growth, McIntosh said he believes a recession will occur. “We do believe that we are going to have a recession here in the U.S.,” he said. “We feel very strongly about it, and a lot of things have lined up to suggest that.”
For the purposes of rental data and research, the San Antonio-New Braunfels Metropolitan Statistical Area is divided into 15 submarkets. This is the percentage of rental rate growth over a 12-month designated period of time.
SUBMARKET
12-MONTH RENT TREND
This is the number of multifamily units being built from the ground up by developers.
UNDER CONSTRUCTION
This is the net change in the total number of multifamily homes leased.
ABSORPTION
This is new apartment or multifamily rental units added to the market each year.
NEW SUPPLY
SOURCE: APARTMENTDATA.COM/COMMUNITY IMPACT
BREAKING DOWN THE TOP 6 SUBMARKETS In 2022, these submarkets saw the most growth in the supply of new multifamily units out of the 15 submarkets that comprise the San Antonio-New Braunfels MSA.
Submarket area Hwy. 151/ SeaWorld
12-month rent trend
Under construction
Absorption New supply
5.9%
987
473
1,202
Thousand Oaks/ Stone Oak/ U.S. 281 North New Braunfels/ Seguin Leon Springs/ Boerne/Kerrville Downtown/ Southtown/ Brackenridge Windcrest/ Universal City
5.5%
641
16
1,134
2%
1,432
-84
662
6%
0
134
605
-0.3%
1,466
441
580
8.9%
830
424
394
SOURCES: APARTMENTDATA.COM, SAN ANTONIO APARTMENT ASSOCIATION/COMMUNITY IMPACT
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