Marla Johnson, director of the Hays-Caldwell Women’s Center, which provides shelter and counseling services for those dealing with domestic abuse, said housing affordability issues in Hays County are directly affecting her organization’s clients.

About 10 percent of HCWC’s clients have been able to move from the organization’s San Marcos shelter to more permanent housing because many of those clients are having trouble finding affordable housing options.

Although it is not a new trend for victims of abuse to return to their abusers, Johnson said she believes the issue is getting worse, as fewer and fewer of the center’s clients are able to find affordable housing options when they are looking to move out of the HCWC shelter.

“What we are unfortunately seeing is that women and men—we have men in our shelter too—are returning to their batterers,” Johnson said. “For them to really not have any other option, you know that they’re going back into a situation that’s dangerous for them and possibly for their children because they really don’t have anywhere else to go.”

The scarcity of housing below the $200,000 price range in San Marcos is one of several housing affordability issues facing Hays County. In San Marcos, Kyle and Buda, rising property values are making it harder for some residents to afford owning or renting homes or apartments.

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San Marcos

In San Marcos, the average value of a home increased 31.5 percent from 2010 to 2016, according to the Hays Central Appraisal District. The average rental rate in the city increased 53.16 percent during the same period.

Average household income countywide increased only 12.16 percent between 2009 and 2014, the most recent period for which data is available from the U.S. Census Bureau.

San Marcos Realtor Monica McNabb said any buyers looking for a “halfway nice” home in San Marcos between $175,000 and $225,000 will very likely have a tough time.

“If you’re not [paying] cash, you’re out,” she said.

In mid-June, there were 74 active listings in San Marcos in the Multiple Listing Service database, which tracks properties for sale. Of those 74 listings, only six were priced at less than $200,000.

The MLS does not include listings for homes that are sold directly from builders to residents, so some offerings at Blanco Vista, a master-planned community that offers some homes starting at $190,000, were not included in the database. But McNabb said those looking to buy a home for $200,000 or less will have a difficult time finding anything in the city.

The price of a piece of raw land in San Marcos—before accounting for construction, permit and infrastructure costs—makes it difficult to turn a profit at a relatively low pricepoint, McNabb said.

“The bottom line is there is just nowhere for those people to buy,” McNabb said. “A builder can’t make money [with a] $150,000 [home] in San Marcos.”

City Council Member Scott Gregson said he suspects much of the demand for existing housing in San Marcos in the $150,000-$230,000 range is related to Texas State University.

Homes in that price range fit into a “sweet spot” for investors who can purchase the property and rent it out for a profit, he said, so when homes come on the market in that price range, they are often bought quickly.

“We’re trying to encourage people to buy a home and live in it,” Gregson said. “Not just buy a home and use it for investment purposes and rent it out.”

The city of San Marcos is working to address this issue through its new land development code, which governs construction of residential and commercial properties as well as roads, environmental standards and other aspects of development.

The city’s current regulations set the minimum width of a single-family residential lot at 50 feet. Under the new land development code, dubbed Code SMTX, lot widths can be as small as 20 feet. The new minimum requirements will give builders more flexibility, Planning Manager Abby Gillfillan said.

“You take a 150-foot-wide lot, you could get three homes on that [under the current regulations],” Gillfillan said. “[With what’s proposed in Code SMTX] you could get five homes.”

Fitting five homes on a lot that previously would only allow three will require smaller homes, Gillfillan said. But by using shared spaces such as courtyards and moving parking to alleys behind homes rather than in front of them, developments that use the new “cottage-style” residential option presented in Code SMTX will blend seamlessly with existing neighborhoods, she said.

Code SMTX is anticipated to be approved by City Council this fall.

Gregson said there is no “bumper sticker solution” to San Marcos’ affordability issues. The challenge of housing affordability involves city design—the distance a resident travels to get to basic needs such as grocery stores, medical services and employment centers can add to the cost of living—as well as employment opportunities, he said.

“The real question … is, ‘How do we make people be able to afford a house at a market rate?’” Gregson said.

Gregson said City Council’s 2015 decision to restrict jobs-based tax incentives to companies that pay at least $15 per hour could help make home ownership a realistic goal for more city residents.   

Kyle

Dustin Heathman, who works in the oil industry, moved from Lakeway to Kyle’s Waterleaf neighborhood in December 2013 in large part because of the affordability the city offered. Since moving to Kyle, the assessed value of his family’s home has nearly doubled, Heathman said.

“If property values go up—and they will—and they continue to go up at the rate that they’re going up, then [current residents] are not going to be able to stay here,” Heathman said. “Then I wonder what Kyle becomes.”

Although the rising values mean the family could sell their home and make a tidy profit, Heathman said he bought the home planning to raise his family there, and with one of his children already enrolled in school, uprooting the family again is not an option.

In Kyle, the average home increased in value from $127,467 in 2010 to $171,404 in 2016. The average monthly rental rate increased from $889.25 to $1,035 during the same period.

“[Duplexes and accessory dwelling units] were built for 200 years in this country, and everybody kind of stopped building them. But for a long time they were a great source for affordability in neighborhoods.”

—Chance Sparks, Buda planning director

The city’s property tax rate of 58.48 cents per $100 of property valuation is the highest municipal rate in the county, but city spokesman Jerry Hendrix said it is important to remember that Hays CISD and other entities make up a large portion of residents’ tax bills.

“I think the city of Kyle provides a really good value for the property taxes people pay,” Hendrix said.

Buda

The city of Buda began work in June on its Housing Action Plan. The plan aims to identify housing types missing in the city and address those deficits through code revisions and partnerships with Central Texas entities focused on housing, such as the Capital Area Home Finance Corp., City Planner Chance Sparks said.

City residents have voiced a desire for more housing options, such as duplexes and accessory dwelling units, two options Sparks said are difficult to build under the city’s current land development code.

“[Duplexes and accessory dwelling units] were built for 200 years in this country, and everybody kind of stopped building them,” Sparks said. “But for a long time they were a great source for affordability in neighborhoods.”

The city formed a steering committee comprising city residents and representatives from Hays CISD, the Buda Fire Department and the Hays Communities YMCA, Sparks said. 

Sparks said the Housing Action Plan is scheduled to be completed before the end of 2016.

One of the top priorities in the city’s 2011 comprehensive plan is ensuring people can live their entire lifecycle—from childhood through retirement—in the city, Sparks said.

A high-performing school district, “small-town charm” and other quality- of-life factors make the city a desirable place to live, which can make it difficult for people in different stages of life—young families, for example—to afford a home in the city, he said.

“When you put all that stuff together, it’s a recipe to drive property values,” he said.