San Marcos City Council unanimously approved a development agreement Dec. 7 with Austin-based startup Casata to build a new microhome development a few miles from downtown. Just over 200 rental homes will be built on 25 acres of land, ranging from 400-1,100 square feet with one to three bedrooms for rent from $1,175-$1,800.

"We're in between tiny homes and regular homes. They're more efficient, and they're independent, physical homes," Technology and Marketing Manager Forrest Hardy said. "They are attainable housing, so they're housing for he middle class, and it's a really nice alternative for apartment homes."

Hardy added 90% of the homes will be long-term rental units, while the remaining 10% will be short-term rentals listed on Airbnb and Vrbo.

"This is a really significant addition to San Marcos and something that San Marcos doesn't have right now: microhomes for rent," Hardy said.

The development is expected to break ground this year, though there is no definitive timeline set for completion.