By Michael Girdley

What’s really stopping more families from moving into inner city San Antonio?

San Antonio has a population of young professionals, but they’re a small minority. San Antonio is a town of families. As a group, we all want a vibrant downtown full of residents, arts, nightlife, businesses, and kids. However, our population — especially parents — seem to keep buying in the near and far suburbs.

I spoke to a number of parents over the past year who say they would love to move into Southtown, my neighborhood, but they tell me finances are keeping them out. So, I looked into it. I learned it costs a bunch more to live in our inner city than the suburbs.

Here’s the Zillow.com search for downtown in the Bonham Academy area and a similar search in Alamo Heights and Stone Oak. Take a few minutes to look through the listings. For example, here’s a listing for a 2,117 sq. ft. home priced at $209,000 for a 4 bedroom/2 bath on .16 acres in the 281 north/1604 area. Now, I don’t think anyone would argue that this property has about as much soul as a character in True Blood, but compare it to a representative Southtown option in Bonham Academy’s draw for a 1,800 sq. ft. 2/2 plus in-law on 0.06 acres for $255,000:

For a family comparing the inner city to the suburbs, the gulf between living in the suburbs and downtown is huge (data according to zillow.com):

  • List price per square foot in Stone Oak: $92 / sf
  • List price per square foot in Lavaca: $148 / sf
  • List price per square foot in 78209 (Alamo Heights) zip code: $165 / sf
  • List price per square foot in King William: $195 / sf

Yes, you can buy a cheaper home in or near downtown than in the Bonham school area. However, for a family comparing downtown to Stone Oak, the deep west side or Alamo Heights, an apples-to-apples comparison requires limiting downtown to areas with equivalent school quality to those in AHISD or NISD. Bonham Academy is one of those. Unfortunately, the word has gotten out about Bonham and this year the lottery to get in was oversubscribed. So, going to Bonham Academy if you live outside its draw isn’t automatic.

Looking at the other costs of owning a home: taxes, financing and maintenance. For maintenance, your century-old home is going to break down on a regular basis. Many historic home owners say a historic house owns you. They’re right.

The property tax rates are very different (our Lavaca home has taxes 18% higher than our NEISD example house and 14% higher than our AHISD sample:

  • SAISD Home Total Tax Rate (for our Lavaca home above) per $100 in value:2.635384
  • AHISD Home Total Tax Rate** (for a randomly selected Alamo Heights house) per $100 in value: 2.315756
  • NEISD Home Total Tax Rate (for our example home above) per $100 in value: 2.226626

Financing your urban home is often very difficult. Many real estate agents avoid downtown for this reason. Deals fall apart because often appraisers can’t find enough comparables to justify a loan.

Finally, unlike other urban areas, a family needs at minimum one car to acquire groceries, visit doctors, and so on. So, you can’t expect the savings that a resident of New York, San Francisco or downtown Austin can realize by avoiding car maintenance, operation and insurance.

Realistically, there’s no way our society is going to stop subsidizing sprawl. Some people just like the suburbs. That’s okay. However, if we want families to move into our inner city, there’s got to be a compelling reason for them to want to pay more to do so. In a subsequent post, I’ll talk about the different opportunities for San Antonio to get families to move back into town.

** Alamo Heights recently announced an increase in property tax rates.

Michael Girdley is a businessman, angel investor and father of two.  He lives in Southtown San Antonio in a house that’s 121 years old. Follow Michael Girdley on his blog, in which he regularly asks questions he attempts to answer himself.