This story originally appeared on Texas Public Radio

The Hunt for Affordable Homes

To put it simply, the San Antonio area doesn’t have enough homes of good quality for middle income earners.  A U.S. Housing and Urban Development study found that more than 150,000 San Antonio homeowners or renters are paying more than a third of their income – the recommended maximum – for housing.

These are working people with household incomes around $50,000. For many of them, having the American dream is slipping beyond their reach.

It’s cold, rainy and dark outside. Not the ideal time to house hunt. Still, first-time homebuyers Gabriela Ramirez and Brian Wakely have rushed to see a five-year-old, 1,600-square-foot home for sale, near the Stone Oak area of San Antonio. The home is priced at $205,000, which is a bit of a stretch for the couple’s budget. Gabriela is finishing her marketing degree. Brian works at a cable television company.

“We were thinking lower than $200,000, but when we started looking, we didn’t want to live in those neighborhoods so we decided to bring up the price,” says Gabriela. “Once your family grows you’re going to grow into a bigger house so you want resale.”

“When you’re looking at the lower end of the price range, $175,000 to $180,000, the areas aren’t as well kept,” says Brian as the couple checks out the tile floors and open kitchen of the home they’re touring.

Their realtor, Brian Mylar, urges them to move quickly if they want this house.

“If you go from $150,000 to $250,000, those homes don’t stay on the market very long. That is the most popular price range in San Antonio. There are lots of cases of multiple offers, sometimes homes only stay on the market for a day,” says Mylar.

Mylar says it’s especially competitive for median income buyers looking near the bottom of that range, for houses priced around $150,000.

“Houses aren’t being built in that range,” says Mylar. “Unless you want an older home, you aren’t going to find anything new in that range.”

Housing Prices Have Risen Faster Than Wages

The San Antonio Board of Realtors, (SABOR) says that in Bexar County last year, the median price of a brand new home climbed to $255,000.  The median price of all homes sold rose to $184,000.  That’s 42 percent more than the cost of the median priced home 10 years ago.

Meanwhile household income for our area  actually went down. The U.S. Census Bureau says the San Antonio metro area had a median household income of $52,689 in 2014. When adjusted for inflation the median household income in 1999 was $55,631 in today’s dollars.

So how did this happen?

“When we started we sold lots for many, many houses under $100,000, that wasn’t uncommon at all 25 years ago,” said San Antonio real estate developer Norman Dugas.

He says the dramatic increase in the cost of new homes today begins with the price of raw land. More people are moving to the area and that’s driven up the cost.

What’s Increased Housing Prices?

Standing in front of a huge wall map, Dugas points to the subdivisions where he’s put in the drainage, roads and utility access needed for building. He says the cost of materials has increased faster than inflation, and the cost of new government regulations is also being passed on to homebuyers.

“The San Antonio Water System’s (SAWS) water impact fee is now almost $2,800 per home.  It used to be non-existent.  You know, Bexar County has changed the street standards from an inch and a half of asphalt to two inches of asphalt.  Doesn’t seem like much but that’s 33 percent more asphalt.  And all those things disproportionately affect the price of entry level homes,” says Dugas.

Dugas says a lot ready for building usually accounts for 20 percent of the home price.  So at an average of $40,000 to $45,000 for a starter home lot, the area’s entry level homes are now priced between $200,000 and $225,000 – more than many median income households can comfortably afford.

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