In San Antonio, Texas, Rate Volatility Is Keeping Both Buyers and Sellers on the Sidelines

Written by:

Alejandra Rodriguez

Date:

10 Aug 2026

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San Antonio has long attracted relocating buyers, military families on PCS orders, civilian contractors, and professionals priced out of Austin, because of its relative affordability. But the math that once made the market accessible is now working against both sides of the transaction simultaneously.

Sellers who locked in mortgage rates below 3.5% recognize that even a profitable sale puts them back into a borrowing environment at 6.75%. Buyers face the compounding pressure of elevated prices that never meaningfully corrected, rising property taxes that track those prices, and interest rates that have swung from above 7% down to 5.99% and back up to roughly 6.75% since April, according to Brayson Verzella, Founder and Team Leader of Team Infinity Real Estate Group, who has worked the San Antonio and Austin markets since 2005. Activity has slowed not because fundamentals collapsed, but because the cost of moving – in any direction – has become difficult to justify.

“Even if you’re doing well in life, you have to think to yourself, okay, if I sell this house and I do well, I’m going to have to go and buy this next house,” Verzella says. “I’m looking at a 6.75 interest rate. I’m looking at some of the highest sales prices on homes that have ever existed because they haven’t really corrected extremely.”

Verzella says many homeowners who bought 10 or 20 years ago and locked in rates below 3.5% feel no urgency to move, and are grateful they don’t have to. For those who do need to sell, the calculation is stark: they must weigh the gain on their current home against higher borrowing costs, elevated purchase prices, and property taxes that have kept pace with appreciation.

Where Motivation Is Showing Up

Roughly 66% of San Antonio’s market falls between $200,000 and $500,000, with meaningful inventory above $500,000 and below $200,000. The luxury segment is where motivated sellers are now appearing at discounted prices. Verzella describes homes that listed at $1 million a few years ago now selling in the $700,000 to $760,000 range, a significant correction in a market where most price levels have consolidated rather than declined.

Motivation is unevenly distributed, however. Verzella notes that many listings are canceling with fewer than 30 days on market, a pattern he attributes partly to sellers pulling listings after receiving little to no showing activity. The causes vary, pricing, presentation, condition, but the underlying dynamic is consistent: buyer pools in certain niches and price ranges have shrunk, and properties that don’t immediately attract attention are sitting.

The exceptions are what Verzella calls “unicorns,” homes on land with privacy, strong landscaping, pools, and good interior condition, priced correctly. “Those kinds of properties are still doing really well, all things considered, and still getting a great price relative to their peers,” he says. For sellers, this means that condition, presentation, and accurate pricing now separate homes that sell quickly from those that stall; generic listings in an average state cannot rely on broad demand to carry them.

The Military Buffer and Its Limits

San Antonio’s military presence – including Joint Base San Antonio and its associated medical and defense contractor ecosystem – has historically provided a demand floor that insulates the market from the sharpest national swings. Military buyers operate on non-negotiable timelines dictated by orders, which means they transact regardless of the rate environment. Combined with a tourism economy anchored by the Riverwalk and historical sites, and a medical sector spanning both military and civilian institutions, San Antonio has structural demand drivers that many mid-tier metros lack.

These buffers have limits. Verzella rates current residential affordability at a 3 on a 1-to-10 scale, with the trend still deteriorating. Fix-and-flip conditions score similarly at a 3. Commercial REITs rate a 6, the most favorable category on his algorithm, though still not strong. “A lot depends on what the Fed does,” he says, referencing the decision to hold the fed funds rate steady. “If they bring the rates down, I think we’ll see real estate follow ultimately, even if it’s lagging.”

What the Investment Case Looks Like Right Now

For investors willing to deploy capital, Verzella’s advice centers on building protection at every stage of a transaction. Buy below market from a motivated seller, create a cushion there. Be conservative on renovation spend, another cushion. Price the exit conservatively, a third layer of protection. The goal is to insulate against rate volatility by compressing timelines.

“If you can flip something in 60 days, you don’t have to worry so much about a dramatic rate change the way that you might if you take six months to renovate something,” he says. For buy-and-hold investors with a five-to-ten-year horizon, he views the current environment more favorably, noting that historical data across multiple decades shows upward trends over each ten-year period.

The practical opportunity, as he describes it, lies in properties that need modest work, exterior landscaping, design updates, some sweat equity, owned by sellers who can’t afford or don’t want to invest further. The key constraint is doing the math in advance: forecasting renovation costs, realistic exit prices, and ROI before committing capital. “In this environment where rates are very volatile, and rates are probably the biggest threat, creating cushion everywhere that you can is probably the smartest way to invest,” Verzella says.

Hyperlocal Conditions Still Override Broad Trends

Even within San Antonio, market performance varies block by block. Verzella points to recent flooding in the Boerne area as an example: some homeowners experienced catastrophic damage, while a listing he holds in Lost Creek, a community in the same area but at higher elevation and farther from the nearest watershed, received multiple showings in its first week and an offer within days. The buyer of that home might never have known flooding occurred miles away.

Verzella says outperformance is ultimately a characteristic of each individual home rather than of entire neighborhoods. A seller’s equity position, the home’s condition, and realistic pricing can make a property competitive even in a struggling submarket. Conversely, when every characteristic works against a listing, unmotivated seller, poor condition, overpriced relative to what the market will bear, he advises sellers to wait rather than waste time and emotion on a listing that won’t move. “I would just rather let you down now than disappoint you later,” he says.

For buyers with cash or patient capital, the current combination of motivated sellers, compressed luxury prices, and reduced competition from sidelined borrowers creates conditions where selective purchases can be made at prices well below recent peaks, provided the buyer does the math before committing.

About the Expert: Brayson Verzella is Founder and Team Leader of Team Infinity Real Estate Group, serving the San Antonio and Austin, Texas markets since 2005.

This article is based on information provided by the expert source cited above. It is intended for general informational purposes only and does not constitute legal, financial, or real estate advice. Readers should conduct their own research and consult qualified professionals before making any real estate or financial decisions.