Is the short term rental market oversaturated in San Antonio?

Question

Does it seem that the short term rental market is oversaturated in San Antonio therefore lowering profits for operators? Is it even still a viable model for making money?

Sherylyn Holden · Answer

I have 5 short term rentals here in SA. Location is everything. It's definitely slower than a few years back. Perhaps due to more saturation and macro economic factors but overall good properties in good areas still perform.

I had to shift my mindset from a strictly "numbers" lense to a "hospitality" lense a bit. But I have had some that bust and some that do great (I don't offer any fancy amenities). In my experience, larger homes in a good area with A+ cleaning are my bread and butter and still perform well. You can find a slew of 3/2 rentals, but 5 bedrooms+ is not as easy. Find where can you be that scarcity in the saturation

Collin Hays · Answer

STRs are always viable if you find the right deal. I invest in the Smokies, and the best buy I ever made was in 2021, which turned out to be the very height of prices in the area.  You are only looking for one good deal. Who cares what the rest of San Antonio is doing?

Blake Anthony Carter · Answer

Hey Joe! We've done several successful deals in San Antonio. You can definitely still have success. SA's restrictions are a pain in the butt but they keep supply down which helps performance. Happy to show you some details on the success we've had with our clients.

Account Closed · Answer

With the military bases there and bootcamp graduations happening weekly, BAMC patients having family members needing a place to stay, traveling docs/nurses and all the TDYs to the installations it seems an STR in the right place and marketed right could easily succeed.  Being AF for 29 yrs, I never thought of SA being a tourist destination but more of a work destination.

Rashad George · Answer

I don't own a successful STR in SA yet but, I know it can be done. I see many plain STRs out there which probably don't perform super well. Having an amenity or set of amenities is all the rage these days. I've noticed the shift in STR amenities of the last few years at the places where I've stayed. It sounds like you're on the right path by doing your research and polling the community. Whatever you do, please don't have an STR with plain decorations that looks like a hotel where people still have to take their own trash and do their own daily cleaning.

Andrew Steffens · Answer

FWIW AirDNA gives it a 58, which is not great.  Most markets I operate in FL are 85+.  That said, as Collin mentioned getting a deal is what can make or break a property's profitability and overall viability.  Also with STR's you must know your market.  You can have two properties across the street from each other and one is a top 10% property and the other is a bottom 10% property.  It is all about location, amenities, design, and management (maintenance and housekeeping quality control, pricing, guest communications, and marketing.

Roberto Torres · Answer

This thread nails it pretty well. Blake's point about restrictions is actually the most important thing for anyone evaluating SA STRs — the compliance layer is exactly what keeps the market viable.

The 12.5% block face density cap (roughly 1 Type 2 permit per 8 houses on a block side) combined with the neighborhood notification process means supply stays naturally constrained in a way it doesn't in unregulated markets. That's what the AirDNA score of 58 doesn't capture — permitted operators in the right locations are protected from the flood of inventory that kills margins in other cities.

The piece that trips up most investors is verifying zoning before close, not after. RM-4 (common in Southtown, Dignowity Hill, Tobin Hill — the neighborhoods Sherylyn mentioned) permits Type 2 STRs. But you want that confirmed at the parcel level, not assumed from the zip code. I've seen investors close on properties that looked identical on paper with completely different compliance outcomes.

I built a tool that automates this — pulls live zoning data from SA's official GIS and generates a full permit roadmap for any SA address in minutes: strzonepilot.com. Happy to answer any SA compliance questions here too!

Rashad George · Answer

Also, consider having breakfast options for your guests or at least coffee. I feel like that part is often missed. It wouldn't take much or cost much to offer a box of donuts from a local HEB and a coffee maker. The best STRs that I've stayed at actually offered breakfast or a credit/card for breakfast at a local spot.

Jules Aton · Answer

I've only been there once but seemed like a busy tourist destination with a clear indication of the premier geographic area which are things I look for in STR.

Alyssa Marquez · Answer

My personal feeling is STRs can still be a viable play in SA, but I do think it’s much more of an arms race than it used to be. I’m talking about buying the right kind of asset, being conservative in your occupancy, price per night, costs of cleaning, and management, and your utility estimates.What I’d make absolute sure of is the math still pencils out as long term buy and hold rental. If the only way you make money is the STR math, I’d likely walk on the deal. But if you have good BDM and theSTR is just gravy, that’s great then buy.

Is the short term rental market oversaturated in San Antonio?

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