Real estate data from the Austin Board of Realtors showed the median home price in the combined areas of San Marcos, Buda and Kyle was $229,900 in March, up 3.6 percent from the same time last year.
And according to a news release from Chief Appraiser David Valle, the average market value of homes in Hays County grew 7.1 percent to $230,014 over last year.
“We’ve seen increases in value over the last five years,” he said, attributing the rise in property values to three things: job growth, population growth and Hays County’s proximity to Travis County.
“There’s just a lot of people moving into this area. We’re right in the metro with Travis County, and a lot of jobs are being created there; it impacts Hays County. Hays County also continues to be more affordable than Travis County. Some people are looking to Hays County for a little more affordable home values than Travis County,” he said.
Growth along the corridor
New U.S. Census Bureau population estimates released in March showed Hays County was the fourth-fastest growing county among those with populations of 10,000 or more in the country from 2016-17.
The estimates also showed the county grew from a population of 157,104 to 214,485 in seven years. From 2016-17, it grew from 204,365 to 214,485 people, a 4.95 percent year-over-year change.
“Growth” is a familiar word to residents living in cities located along the I-35 corridor that connects San Antonio and Austin, and officials say growth—not just in population, but also in jobs, infrastructure and education—will continue to impact those cities for the foreseeable future.
San Marcos Mayor John Thomaides touched on the topic during his State of the City address, saying, “With this growth, we must remain vigilant in our efforts to keep the unique character and charm of our city intact and protect the natural beauty we all love.”
Meanwhile local economic development representatives are embracing Hays County’s position along I-35.
The Greater San Marcos Partnership, a public-private partnership serving the regional economic development interests of San Marcos, Hays County and Caldwell County, has dubbed the area between San Antonio and Austin the “Innovation Corridor”.
GSMP President Adriana Cruz said one of the ways her organization approaches companies looking to settle in the area is by using Texas State University as an asset and showing companies that the university is a workforce pipeline. Texas State’s president, Denise Trauth, is chairwoman of the GSMP board.
“Becoming a center of innovation and becoming a center for research as the university has transformed itself over these past 15 years really helps to drive future economic benefit,” Cruz said. “The university is very, very deeply involved and committed to economic development and job creation in the city and the two-county footprint.”
Growth is also appearing in the form of jobs in Kyle and Buda: In early April, three new medical facilities bringing a combined 225 jobs began construction in Buda, and in late April, a new mixed-use, master-planned development called the Hays Commerce Center broke ground in Kyle.
The commerce center, set to be complete in the fourth quarter of 2018, contains more than 400,000 square feet of leasable space, and according to a GSMP press release, its developers will be targeting e-commerce and logistics industries.
According to preliminary appraised values from the Hays Central Appraisal District, commercial and industry property in the county increased by 12.61 percent in value year over year, from $2.22 billion in 2017 to $2.5 billion in 2018.
Hays County added 83 new commercial buildings to the appraisal roll this year.
Property tax protests
When determining the value of a property, the appraisal district classifies properties according to a variety of factors, such as size, use and construction type. Using data from recent property sales, the appraisal district appraises the value of typical properties in each class. Taking into account variables such as the age or location of the property, the appraisal district uses typical property values to appraise all the properties in each class.
Property owners have until May 30 to protest their appraised values if they feel their property was not adequately appraised. Residents should gather evidence showing why their value should be lowered, such as recent sales of comparable homes, photos of damage and repair estimates.
As property values in Hays County have gone up, so, too, have the number of protests the HCAD receives each year. From 2013-17, the number of appeals filed increased 99.34 percent, and Valle said he expects the number of appeals filed in 2018 to increase over last year.
According to the Texas Comptroller’s Office, between 70-90 percent of appeal disputes are settled when the property owner meets one-on-one with an appraiser during an informal process.
Last year 12,508 of the 14,602 appeals filed in Hays County were settled through informal processes, according to the HCAD 2017 annual report. The other cases went through a formal hearing with the Appraisal Review Board, a three-judge panel of volunteers who hear the appeal, consider the evidence and make a decision on the value of the property.
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Considering tax rates when buying
Even as some municipalities and school districts in the county have lowered tax rates in the past few years, local homeowners continue to see the amount of money levied to local taxing entities steadily rise. And those levies, coupled with an increasingly premium real estate market, are making it increasingly hard to find affordable housing.
Stacy Bass, who serves on the board of directors for the Austin Board of Realtors, said when considering affordable housing in Hays County, homebuyers should pay attention to which tax rates are increasing and factor that into their budget.
“In Hays County we are primarily the destination for affordable housing along the I-35 corridor for people to get jobs and commute into Austin. The sad thing I see going on [is] tax rates at 3 percent and above, the majority [come from the] most affordable housing stock,” she said.
For example, a home in Kyle’s Plum Creek neighborhood may be appraised at $211,420 and have a total tax rate of 2.8 percent after adding up each tax rate from the various taxing entities, including Hays CISD, Hays County, the Plum Creek Conservation District and Austin Community College.
A homeowner in Dripping Springs pays taxes to Dripping Springs ISD, which has the highest tax rate in the county at $1.42 per every $100 valuation, as well as to the county, the city and various emergency services districts.
“If you are a homebuyer in the $300,000 or less price point, you don’t have the luxury of deciding what tax rate you want to be in,” Bass said, because those homes are less readily available. “[Tax rates are] something all consumers should really pay attention to.”
Bass recommended everyone protest his or her values and get an informal hearing with the appraisal staff.
“That’s where they are going to have the best luck getting someone to listen to their individual needs,” she said, adding that in her experience, homeowners do not have much luck lowering their values during a formal Appraisal Review Board hearing.
She recommended that homeowners reach out to a local real estate agent who could help them gather material for their home value protests with the HCAD.
Bass said all factors indicate the housing outlook for Hays County and the Austin region is strong, and she does not anticipate the market slowing anytime this year.
“I do think it’s still extremely competitive and hard to find a house in certain price points in our market, and that’s probably not going to change in the next many years,” she said. “Something’s got to give at some point with our property taxes. The problem is, we’re growing so fast.”
Additional reporting by Caitlin Peronne and Amy Denney