Kyle Mayor Todd Webster said he moved into the east Kyle subdivision of Steeplechase in 1998 and has lived in the same home since.

Since then he has obtained his law degree, his wife began working at Austin Community College and his children have grown from infants to high school graduates.

Webster said he contemplated a move up—into a bigger home on a bigger lot with a higher price tag. But moving up would have also meant moving out of Kyle.

“I started looking, and every place that I found was outside of Kyle,” he said, adding he did not want to move his daughters who were nearly done with school.

The city has gained a reputation over the years for having affordable homes—from about $150,000 to the $200,000s—but has lacked a higher-end product to retain residents who have outgrown their first home or entice high-earning professionals to move to Kyle.

At least three developments—Cypress Forest, at the corner of West Center Street and Old Stagecoach Road; a more than 2,000-acre tract of former Texas General Land Office property featuring land fronting the Blanco River; and Anthem, a master-planned community currently in Mountain City’s unincorporated area—are set to build homes with larger lots, different amenities, more green space and higher price tags than are currently available in Kyle’s housing stock. Cypress Forest was the first to break ground in September. Because of their higher property valuations these homes could ease the property tax burden Kyle’s homeowners have borne in recent years, Webster said.

“I think there’s a lot of people in Kyle that will have an opportunity to move into those neighborhoods instead of moving out of town,” he said. “I want Kyle to be a place where people feel like they can stay.”

Balancing the tax base

In addition to potentially reducing community turnover, move-up homes can help balance the tax base, city leaders said.

Homes with higher valuations generate more property tax revenue and can ease the burden on taxpayers on the lower end of the scale. At a certain individual property valuation the city begins to “break even” as the tax revenue generated matches the cost of providing services, such as sidewalk usage, parks, library services and police support, Webster said.

City Finance Director Perwez Moheet said the cost of service to a $150,000 home is about equal to the cost of service to a $300,000 home, for example, but the higher-priced home generates about twice as much tax revenue for the city.

“In the high price-points that gap [between the cost of providing service to a home and its contribution toward paying for those services] will narrow,” Moheet said.

Kyle City Council approved in September a property tax rate increase of $0.0465, from $0.5383 per $100 valuation in fiscal year 2014-15 to $0.5848 per $100 valuation in fiscal year 2015-16.

Several residents said in public hearings that their property tax bills have been rising every year, and they may be forced to move out of Kyle if the property tax rate keeps increasing.

Cypress Forest

Kyle’s first homes with lot widths of 65 feet and larger are expected to be built by next summer, officials said at a Sept. 16 ground breaking for upcoming residential community Cypress Forest.

The Cypress Forest homes, which are likely to be priced in the high $200,000s to $400,000 range, will be a step up from the housing Kyle has traditionally offered, Council Member David Wilson said.

“It’s a break from starter homes we have in our community,” Wilson said. “We have some real quality homes. We are a good value in the Austin area, and everyone knows it. This is going to add an additional value.”

David Weekley Homes and Scott Felder Homes will begin building the 340 homes on 55-, 65- and 80-foot-wide lots. Additionally, Cypress Forest will feature natural landscaping and community amenities, such as a pool, trails and a lake.

Presales are expected to begin in early 2016. Cypress Forest’s first model home is targeted for completion in June 2016.

Jim Rado, David Weekley Homes area president, said the company is building in Kyle because of its demographics—with more mature families and a growing number of pre-empty nesters.

“That market segment hasn’t been met as well as it could be partially because the land itself has not been as pretty as what we have here,” Rado said. “We’ve got a gorgeous piece of property here we think will attract that buyer
segment.”

“You build for what the research shows, and the research shows there is definitely a pent-up demand for move-up housing in the Kyle corridor.”

- Clark Wilson, president of Clark Wilson Builder

The 130-acre neighborhood, its entrance near the intersection of Center Street and Old Stagecoach Road, was annexed into the city of Kyle this year.

Other developments

At least two other residential developments offering move-up homes in the Kyle area are in the works. Both are currently west of the city limits and could be annexed by Kyle.

Anthem will offer a move-up housing product with lot sizes ranging from 6,000 to 10,000 square feet. Green space will be a major aspect of the community’s character, said Clark Wilson, whose firm is building the neighborhood.

“As a builder you do research,” Wilson said. “You build for what the research shows, and the research shows there is definitely a pent-up demand for move-up housing in the Kyle corridor.”

On June 1 a Houston-area developer paid $17.33 million to acquire a 2,166-acre tract of land from the Texas General Land Office. Adjacent to Kyle’s western boundary, the development is planned to offer move-up residences, schools, churches and commercial property, said Bob Richardson, CEO of RVI Planning and a consultant for the developer.

“It’s too early to tell what they are going to do,” City Manager Scott Sellers said. “There has been so much talk about possibilities, and that’s because the developer is so open to possibilities. … It’s going to provide a product that is in major need in Kyle.”