Page 8 - Builder Brief June 2026 Issue

2 0 2 6 P R E S I D E N T
SAN ANTONIO HOUSING
MARKET UPDATE: MID-YEAR
FORECAST FOR 2026
As we move into the second half of 2026, the San Antonio housing
market continues to navigate a period of adjustment shaped by affordability
concerns, elevated mortgage rates, and cautious consumer confidence.
While demand for housing remains fundamentally strong due to continued
population growth and long-term economic expansion across Texas,
builders and buyers alike are operating in a market that is more measured
than the rapid pace experienced in recent years.
National housing data reflects many of the trends we are seeing locally.
According to Zonda’s April 2026 New Home Market Update, builders
across the country faced a slower-than-expected spring selling season,
with 70% of builders reporting softer market conditions in April. Ali Wolf,
Chief Economist for Zonda and NewHomeSource, noted that “higher-than-
expected mortgage rates, rising gas prices, incentive fatigue, and broader
economic uncertainty have combined to hold sales flat.”
San Antonio was among the markets that experienced year-over-year
softness, posting a 12.7% decline compared to last year. However, context
matters. The San Antonio market is not experiencing a collapse in demand,
but rather a normalization after several years of accelerated growth and
unprecedented buyer activity.
Today’s market can largely be divided into two groups of buyers: need-
based buyers and discretionary buyers. Need-based buyers — those
relocating for work, growing families, retirement, or life transitions —
remain active. Meanwhile, discretionary buyers are taking a more cautious
approach, often waiting for improved financing conditions or greater
economic certainty before making a move.
Affordability continues to be the defining issue across the housing
industry. Recent data from the National Association of Home Builders
(NAHB) shows that a family earning the national median income would
need to spend approximately 32% of its income to afford a median-priced
home. For many first-time and entry-level buyers, elevated mortgage rates
remain a significant hurdle despite modest improvements in affordability
over the past year.
Builders are responding strategically. Across the country, many builders
are offering incentives, rate buydowns, and pricing adjustments to maintain
momentum and help buyers navigate affordability challenges. Zonda
reported that 61% of new home communities offered incentives on to-
be-built homes in April, while 78% offered incentives on quick move-in
inventory. Additionally, entry-level home pricing nationally declined by
3.0% year-over-year as builders continue focusing on attainable housing
opportunities.
At the same time, builders are facing their own pressures. Rising
construction costs, labor shortages, financing expenses, and regulatory
burdens continue to impact production timelines and pricing. NAHB recently
reported that single-family housing starts declined 9% nationally in April
B R A D Y J O H A N S O N
as builders remained cautious amid economic
uncertainty and affordability constraints.
Despite these headwinds, the long-term outlook
for San Antonio remains positive. The region
continues to benefit from strong job growth, military
presence, business relocation activity, and steady
population gains that support long-term housing
demand. As interest rates stabilize and consumer
confidence improves, the market is expected to
regain momentum gradually heading into late 2026
and early 2027.
For builders, developers, and industry
professionals, this current environment reinforces
the importance of innovation, operational efficiency,
and collaboration. Housing affordability and supply
challenges will require continued partnership
between the private sector, policymakers, and
community leaders to ensure San Antonio remains
an attractive and attainable place to live.
Industry professionals looking to stay ahead
of emerging trends and connect with leaders
across the residential construction industry are
encouraged to attend the Sunbelt Builders Show
on July 22–23 at the Henry B. González Convention
Center. Additional information about the event can
also be found in the article featured on Page 9 of
this publication.
As the market continues to evolve, San Antonio’s
homebuilding industry remains resilient, adaptive,
and committed to meeting the housing needs of
one of the fastest-growing regions in the country.
Sincerely,
Brady Johanson
8 JUNE 2026 | GREATER SAN ANTONIO BUILDERS ASSOCIATION