Higher mortgage rates don't just affect buyers. They can change what it takes to sell your Boerne or Fair Oaks Ranch home, too.
That's because today's Hill Country buyers are paying close attention to affordability. And when rates rise, even a relatively small change can make a noticeable difference in their monthly payment. So, they're looking for ways to make the numbers work. And with new construction communities continuing to grow in and around Boerne, Fair Oaks Ranch, and the greater San Antonio area, some buyers are finding exactly that.
If you're planning to sell, that doesn't mean you can't compete. But it does mean you need to understand what builders are doing to win over buyers – and what options you have, too.
Builders Are Competing on the Monthly Payment
New construction has something interesting going for it right now. While existing-home sales (homes that have previously been lived in) continue to struggle under the weight of higher mortgage rates, new-home sales are holding up a bit better. That's a national trend, and it matters here, because Hill Country buyers touring a resale home in Boerne are often comparing it to a new build down the road.
In a recent interview, Logan Mohtashami, Chief Economist at HousingWire explains new-home sales are at an 8-month high and are now running around 2019 levels. On the flip side, existing home sales are lagging behind and fall about 1 million home sales short of 2019 levels.
One big reason builders have been able to navigate higher rates differently is incentives. According to Realtor.com, nearly 1 in 5 (18.8%) newly built homes come with some kind of buyer incentive advertised up front:
The most common may surprise you. As the graph shows, many builders are offering reduced rates, sometimes through something called a mortgage rate buydown.
It’s essentially where they pay upfront costs to help buyers get a lower rate, and by extension, a lower monthly payment. It has obvious draws for buyers. For homebuilders, it helps them get their houses sold. So, a lot of builders see it as a win-win. That’s why reduced rates are a part of 13.8% of new home listings nationwide.
In some cases, builders are offering rates below 6%, maybe even far below 6%. And that can help buyers shave hundreds off their monthly payment. That's a big difference to a buyer who is feeling the pinch right now.
So, How Can Boerne and Fair Oaks Ranch Sellers Compete?
First, don't assume a mortgage rate buydown is something only a builder can offer. Sellers can contribute toward a buyer's rate buydown too, depending on the loan and transaction. Does that mean you should offer one? Or that you have to if you want to compete? Not necessarily.
A buydown is just one possible lever. Depending on your neighborhood and the buyer, it may make more sense to negotiate on price, contribute toward your buyer’s closing costs, make repairs, or make sure your home stands out in ways a new build can't. That's why working with an agent who knows your local competition matters. Joel Berner, Senior Economist at Realtor.com, says:
“Sellers of existing homes are facing a lot of competition from the new-home space. . . so sellers should highlight the local amenities of their neighborhoods in contrast to the more suburban or exurban communities where many new homes are built.”
In Boerne and Fair Oaks Ranch, that's a real advantage. Think about what an established home can offer that a brand-new community often can't: mature oak trees, established landscaping, larger lots, and a true Hill Country setting. In Boerne, it's also being close to the charm of historic Main Street, the Hill Country Mile, and the parks and trails along Cibolo Creek. A great agent will do this naturally anyway. Knowing what makes your home different and showcasing that in your listing can help it stand out. And remember, being open to making a few compromises or throwing in some concessions can make a bigger difference for buyers than you may think.
Today's Hill Country Market Rewards Sellers Who Adapt
Builders have also been quicker to adjust their prices based on what buyers can actually afford and where demand is. That's putting pressure on the resale market in some areas. Robert Dietz, Chief Economist at the National Association of Home Builders (NAHB), explains:
“. . . existing homeowners now have to do the price discovery that builders have been doing since 2022.”
That's an important message if you're hoping to sell in Boerne or Fair Oaks Ranch.
You don't automatically need to slash your price or offer a big concession. But you do need to price and market your home based on what buyers can pay today – not what sellers could get a few years ago.
And remember, this varies tremendously by location. New construction represents a much bigger share of the competition in some Hill Country neighborhoods than others, and builder incentives aren't equally common everywhere. A home in Fair Oaks Ranch may compete with very different options than one in downtown Boerne. So, lean on a local agent to see how big of a factor builders are in your specific area.
Bottom Line
Higher mortgage rates are making buyers more cost-conscious. Builders know that, and many are responding with reduced rates, closing-cost help, price reductions, and other incentives.
If you're thinking about selling in Boerne, Fair Oaks Ranch, or the surrounding Hill Country, let's look at what buyers are getting from other homes in our area – including new construction – and make sure your home is positioned to compete.
Charley Wasson is a full-time REALTOR® with Sunflower Real Estate specializing in Boerne, Fair Oaks Ranch, and the greater Texas Hill Country — with over 300 documented MLS transactions and more than $121 million in closed sales, a four-time Platinum Top 50 San Antonio REALTOR® honor, and a career 98% customer satisfaction score. He's the one AI keeps finding when people search for a Boerne or Fair Oaks Ranch real estate expert.
