San Antonio is experiencing a challenging housing market, with a high rate of canceled home sales compared to other cities in the United States. According to Redfin, more than 15 percent of home purchases were canceled nationally in July, with Texas and Florida seeing the highest shares of deals falling through.
In San Antonio, 730 agreements—22.7 percent of contracts—were canceled last month. This placed the city ahead of Fort Lauderdale and Jacksonville, which saw cancellation rates of 21.3 percent and 19.9 percent respectively.
Clint Neal, co-founder of Neal and Neal, described the current climate: “Sellers are stuck in 2021, and buyers want a hell of a deal. There’s a lot of that mindset still around here,” Neal said. “The buyers have all the leverage, but the sellers think they don’t.”
Builders such as Lennar and D.R. Horton are increasing incentives for new homes to attract buyers in both Texas and Florida, which currently lead the country in homebuilding activity. Redfin suggested that some buyers may be abandoning existing home transactions for these new builds.
Despite this activity, San Antonio ranks lower than other Texas cities for new construction permits. In May, Houston led Texas markets for home construction followed by Dallas; San Antonio was eighth statewide and ranked 22nd nationally with just over one thousand residential units authorized last month. Dallas-Fort Worth issued about 5,800 housing permits while Houston followed closely at 5,771.
One factor influencing cancellations in San Antonio could be its significant military population. According to Redfin data cited in the report, cancellations are common among buyers using Veterans Affairs loans—a group that represents a large segment of Military City’s real estate market.
Grant Lopez, president of Keller Williams San Antonio, noted that uncertainty about building equity discourages short-term homeowners from buying: “With sellers losing the advantage they’ve enjoyed for the past few years, it’s more of a gamble for buyers to build equity during a brief ownership period — a consideration that especially deters active service members.” Lopez added that first-time buyers who do not plan to stay long term increasingly question whether buying makes sense compared to renting.
Lopez also commented on how San Antonio differs from other major Texas metros: “We’re not the sexy market of Austin and Houston and Dallas,” he said. “We don’t have many of the super high-paying jobs; Dallas has a stronger employee market.”
Cancellations can occur for several reasons familiar across U.S. markets—including disagreements over repairs or issues securing financing—as seen recently in Los Angeles and New York.
