Most 2026 deliveries landed in first quarter in San Antonio’s multifamily market

San Antonio multifamily market overview

San Antonio’s multifamily market is navigating a period of acute stress, with vacancy and rent metrics reflecting the cumulative impact of years of elevated deliveries against a demand environment that has struggled to keep pace. Vacancy surged 160 basis points during the first quarter and 220 basis points year over year. First-quarter negative absorption of 1,700 units was the primary driver, though trailing 12-month absorption remained positive at 745 units, underscoring how subdued demand has been in recent periods. Rent pressure has been broad-based, as asking rents declined for the fourth consecutive quarter to a five-year low, with declines across all asset classes. The North Central submarket stood apart, recording both annual vacancy improvement and rent growth, and serving as a pocket of resilience in an otherwise challenged market.

The multifamily investment market in San Antonio reflects the challenges of the current operating environment. Distressed and foreclosure activity increased during the quarter as property income fell short of lender thresholds, introducing forced sales that added to transaction volume. The first quarter median sale price was $132,600 per unit across 12 reported transactions. A notable undercurrent in sales data is a shift toward newer-vintage assets, as a large share of San Antonio apartment stock was acquired and repositioned over the past five years. Cap rates widened to an average of 6.0% in the first quarter, up 50 basis points from the 5.5% average recorded in 2024, reflecting weaker fundamentals and higher investor risk pricing.

Looking ahead for San Antonio

The path toward stabilization in San Antonio runs through the supply side of the equation. Deliveries are forecast to total just 2,600 units for the full year, a 63% decline from 2025 and the slowest pace of new multifamily supply the market has completed since 2011. With only 800 units scheduled to deliver over the remainder of 2026, near-term pressure from new completions is diminishing. Permitting activity has also stepped down sharply, with full-year 2026 estimates pointing to the lowest annual total in over a decade. This contraction in the pipeline, including both proposed projects and those underway, establishes a structural foundation for recovery, though the pace of improvement will be determined largely by demand. Absorption has been variable in recent periods, leaving demand a key driver of near-term performance.

The investment outlook for San Antonio hinges on how quickly the distressed sale cycle runs its course. Forced sales introduced by income shortfalls have repriced risk in the market, with cap rates now averaging 6.0% and likely to rise until vacancy begins a sustained decline and rent trends stabilize. For patient capital, this repricing creates an entry point not widely available in this market in the prior cycle. The market has a deep base of value-add buyers, many of whom repositioned assets acquired during the past five years and may become more active as distressed opportunities increase. As fewer aged properties remain in the available inventory, the shift toward newer-vintage assets observed in the first quarter may continue. As new supply contracts, San Antonio’s investment market should gradually rebalance toward a more stable transaction environment.

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For a more complete analysis of the supply, demand, vacancy, rent and investment trends in the San Antonio multifamily market, download and read the full report below.

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