Forbes.com ran a story the other day about the least (and most) expensive US cities for home ownership. San Antonio was ranked the fourth least-expensive city on their list. No surprise here. Gasoline, food, and utilities cost less than in many other large cities. San Antonio's warm climate and continuing economic growth continue to make it an attractive city for retirees as well as relocating workers.
Behind (or beside) the Alamo
In the San Antonio metro area, real estate did not appreciate nearly as much as in other places, so it has not depreciated as much either, although it is definitely a buyer's market now. Only 1,710 existing single-family homes sold in San Antonio in August, down 26 percent from 2,317 homes in August of last year. Home sales are down 19%, while average prices have increased only 1% in total compared to the January-August 2007 period. The average days on market have also lengthened from 68 to 83 compared to last August.
San Antonio's median home price is still $153,300, the same as it was in August of 2007, but foreclosures totaled 1,015--up 43% from the same time last year.
There is some good news for investors: rental rates are also going up in response to demand from people unable to buy a home. But San Antonio still placed sixth on another Forbes.com list, that of the least expensive cities for renters. The median rent was shown as $707. Of course, this figure includes studio apartments all the way up to 5-bedroom homes.
For a multi-family property, I'd recommend looking for a rental rate of at least $550/unit for a 1-bedroom. I'd advise at least $950/month for a single-family home. This doesn't refer to cash flow as much as getting to a certain income threshold for prospective tenants.
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