Eagleford Shale impact on areas in South Texas and San Antonio and Floresville and La Vernia
Starting on this real estate venture in early 2005, we were still a sleepy town with very affordable homes. People from the San Antonio area were starting to discover us as an affordable alternative to the northside of San Antonio and the outlying towns. Our commute time to San Antonio is great; our traffic was low and it was a good affordable place to move.
That allows us to work in San Antonio and all the surrounding areas with ease.
Then Eagleford Shale came to South Texas and the effects have been seen. While the excitement has dropped the effects are felt all over the area; both good and bad. This small sleepy south Texas area was not prepared for the sweeping tide that engulfed the San Antonio area and Wilson County and the towns of La Vernia and Floresville. Having lived in this area the great majority of my life it was unbelieveable to watch. The boom has come and has seemed to have left. Until the oil prices go back up, activity has basically ceased. Our roads which suffered damages due to the heavy truck traffic are now like ghost towns compared to what it had been. So the revenue has left with the damages still here.
Enter Eagleford activity starting around 2010 and our prices started to skyrocket as the inventory for the demand was not there. You heard all types of projections from the people moving in: they were told the play would last at least 5 years; at least 10 years; at least 20 years. The persons south of us in Karnes County really started to see dollars flow into their community and many of their pocketbooks. The surrounding towns went crazy building hotels and man camps, etc. Many responded quickly and fared well. Many responded slowly and are now in a bind as the downturn has hit.
It has transformed our small towns; they have expanded with national or state chains that had never been here before; the tax monies have really increased. With that tax revenue increase a lot of areas have started to build new schools buildings, etc and others have spent foolishly as they expected the well not to go dry. It has gone down drastically and the towns are feeling the effects of that decrease in revenue.
But what is happening in this area in real estate is contrary to what the natural mind would think. We are thriving and growing. SABOR (San Antonio Board or Realtors) statistics show our growth is not slowing. The current level of available homes on market is 3.6 months. That is low; a balanced market is about 6 months so this low inventory indicates a sellers market and that is reflected in our home prices.
This area has not seen a decrease in pricing but a steady increase. While home prices in 2008 were running $89/sf then moved to about $111/sf in 2010 are now sitting at $125-130/sf on homes in the 10 yr old range. And even the older houses are rising rapidly in price.
So this type of average home at about 1800 sf has moved from a value of $158k to $199k to $225k. And the DOMs are very low; in some areas less than 7 days.
That said San Antonio is still very affordable compared to the other major markets in Texas.