Median home prices in the San Antonio and Austin metro areas are expected to experience among the nation’s steepest declines next year, according to a new Realtor.com study.

The report’s authors expect home prices in the San Antonio-New Braunfels region to drop 9.4% in 2024. Meanwhile, they’re likely to plummet 12.2% in the Austin-Round Rock area — the steepest decline of any U.S. housing market.

The online real estate marketplace’s prediction is based on the idea that sellers will drop their asking prices due to higher-than-usual borrowing costs. Indeed, the current rate for a 30-year fixed mortgage stands at 7.22% as of press time, a 23-year high, according to mortgage lender Freddie Mac.

“We expect that the return to pricing in line with financing costs will be in 2024, and home prices, mortgage rates and income growth will each contribute to the improvement,” Realtor.com wrote in its analysis.

South and Central Texas aren’t the only spots in Texas where folks can expect to see significant price drops next year.

The report predicts the median price of homes will drop by 4.5% in the Houston area and 8.4% in the Dallas-Fort Worth Metroplex.

Home prices in the San Antonio area have stagnated since a heated run-up during the COVID-19 pandemic, when interest rates dropped below 1%. Since then, rates have soared to 5.5% as the Federal Reserve tries to bring inflation under control.

The Fed’s tactics appear to be working. The median sales price for a single-family home in the San Antonio metro remained the same in October 2023 as it had 12 months prior, according to the latest market report from the San Antonio Board of Realtors.

Realtor.com’s report comes mere days after a report by rental marketplace Zumper found that the average rent for a one-bedroom apartment in San Antonio declined 9.5% over the past 12 months.

Even so, Realtor.com predicts average rents in the U.S. will only decline 0.2% next year.

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This article appears in Nov 29 – Dec 12, 2023.

Michael Karlis is a multimedia journalist at the San Antonio Current, whose coverage in print and on social media focuses on local and state politics. He is a graduate of American University in Washington,...