San Marcos Entry-Level Homes: Can Buyers Afford Them?

Can buyers afford the typical home in San Marcos today? The median sale price for entry-level properties (the bottom quartile) reached $328,119 across 55 closed sales in August. With a 30-year fixed mortgage rate at 7.28% according to Freddie Mac data from October 1, 2026, monthly payments have risen significantly compared to previous years. ALEX Intelligence estimates the affordability impact using a standard scenario: a 20% down payment on the median entry-level price. At the current 7.28% rate, an ALEX Intelligence estimate, not an appraisal, places the principal and interest payment at $1,796 per month. To make this more accessible, buyers often use buydowns. An ALEX Intelligence estimate, not an appraisal, of a 3-2-1 buydown would cost approximately $12,204 upfront, lowering the first-year monthly payment to $1,296 for a savings of $500. A 2-1 buydown costs about $6,204, resulting in a first-year monthly payment of $1,454 with a savings of $342. Despite these tools, the median price for entry-level homes is up 17.8% from the prior month but remains 5.7% lower than the same time last year. The market shows resilience with 55 closed sales in August, though this represents an 8.3% drop compared to August 2025. Buyers seeking affordability must weigh the upfront cost of buydowns against the long-term interest rate environment. The median price per square foot for these homes is $180, up 5.3% from July but down 7.2% year-over-year. While inventory remains tight with only 6.19 months of supply, entry-level buyers face a complex landscape where lower prices are offset by higher borrowing costs. Want first look at San Marcos homes? Get new listings sent to you the day they appear. Data from Unlock MLS. Information deemed reliable but not guaranteed. Model outputs are ALEX Intelligence estimates, not appraisals. Read more Central Texas market data on the ALEX blog: https://alex-companies.com/blog MIT, Nvidia, Google & IBM-Trained. Cross Domain-Expert: Quantum, AI, Ethics, Sovereignty, Intelligence, Philanthropy. Solepoint Planning. VUI AI Cloud Architect. AI Certifications Development. Quant/AI Instructor. Castor Venture Club Member. Associate Broker. George Arnold Alexander III, MPA Director, ALEX Companies Associate Broker, Alexander Tiffany Southwest, LLC dba ALEX.realestate, et.al. Texas License #574878-B · Broker License #565194-BB Broker, ALEX Real Estate · North Carolina License #367733 Independent Broker, ALEX Real Estate · Colorado License #II.100112456 [email protected] · +1 713.918.9951