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Population growth, lack of city regulations drive developers farther out
(San Antonio Express-News (KRT) Via Thomson Dialog NewsEdge) Aug. 5--So where exactly does San Antonio end?
With commuters making the daily trek from once-rural towns including Boerne and New Braunfels, and population and job growth fueling an 18,000-homes-per-year building frenzy, San Antonio's housing boom is redefining what's urban, suburban and country.
Call us Sprawlantonio.
Homes are sprouting like backyard bamboo. Even real estate agents take guided bus tours of the suburbs in an effort to keep track of all of the new development.
And last year was the first time the San Antonio area saw more housing starts outside Loop 1604 than inside.
"It's the sprawl effect," said Jim Gaines, research economist with Texas A&M University's Real Estate Center. "San Antonio is bumping into the southern part of Austin, with San Marcos caught in between." Of course, sprawl is not unique to San Antonio. The phenomenon is happening all over Texas, with most of the state's new-home development happening outside the limits of major cities and far from downtown centers, Gaines said.
What drives people to the suburbs are the combined factors of better schools, lower prices, more land availability and reasonable commute times, said Norman Dugas, a residential developer and president of Dugas Diversified Developments.
"You can get to Boerne in under 45 minutes," Dugas said. "Boerne is the imaginary circle. We have huge, huge areas in that circle that are available for development." Living beyond that circle, however, starts to look less attractive for San Antonio workers.
"Once you get a commute longer than an hour or about 45 minutes you start to run into resistance for people to move further out," he said. "Most of the marketplace doesn't want to spend two hours a day in the car." For builders, the lack of city regulation in suburban areas also makes it slightly more affordable to build there.
"The county doesn't have rules and regulations like the tree ordinance that the builder has to live by," said Becky Oliver with the Greater San Antonio Builders Association. "That's what encourages the developers to go outside the city." When it comes to development, counties in Texas have limited authority granted to them by the state.
"It saves you the fees and the hassles of dealing with the permitting authorities," Gaines said. "It means a lot of the new-home construction is being kind of directed on purpose outside of the city." Randall Allsup, manager for the San Antonio office of Metrostudy, a housing research firm, said development is being pushed away from the North Central area that's been popular with buyers in the last decade.
Regulations about construction on top of the Edwards Aquifer, the city's tree ordinance and the area's hilly, rocky landscape make building more difficult and more expensive. That pushes home prices higher and means builders who want to do a more affordable project -- under about $200,000 -- have to move elsewhere.
"Now you see development moving to the west, east and south," Allsup said.
Several large landowners in the far Northwest area of San Antonio recently banded together to extend water and sewer lines to their properties. That investment is opening the door to a huge amount of development -- able to support around 60,000 new houses -- outside Loop 1604 between U.S. 90 and Highway 16.
"There's a decade's worth of new development out there that's now possible," Dugas said.
The changing landscape isn't always easy for longtime owners to watch.
Chip Massey moved to Fair Oaks Ranch in the early 1980s. At the time, he could easily identify his home on an aerial photograph of the area -- there were just three other houses on his street, and vast portions of the development had not yet broken ground.
Now more than 5,000 people live in Fair Oaks Ranch, an incorporated town south of Boerne and off Interstate 10, built on what was a 4,000-acre ranch owned by Ralph Fair.
Massey still loves his town, but now dreads the developments popping up nearby.
"Of course I hate to see how built-up I-10 is becoming," Massey said.
Likewise, golfers at the Canyon Springs Golf Course in the Stone Oak area winced when work crews cut several acres of trees near the club's entrance to make way for a multifamily complex.
Golf course manager Karl Ludeke said the construction noise is annoying and everyone was sorry to see the trees go. But it's also the price of growth.
"The golf course was put here to sell the properties around it," Ludeke said. "I wouldn't be here if the developer hadn't put that golf course in here to sell land." Even longtime builders have been amazed by the pace and scope of San Antonio's growth.
Population growth, higher land prices and the introduction of national builders to the San Antonio market has supersized development, said Jim Bastoni, a partner in Imagine Homes.
"Once upon a time you could buy 50 acres and do a small neighborhood," Bastoni said. "The scale of the deals has gotten so much larger. There are no small deals anymore." Pulte Homes, for instance, purchased 1,600 acres off Texas 151 outside Loop 1604 for its traditional neighborhood, Alamo Ranch, as well as Hill Country Retreat, a Del Webb development for people 55 and older.
Even rural areas farther from San Antonio's core are seeing larger developments.
Cordillera Ranch is an 8,600-acre luxury development off Texas 46 and alongside the Guadalupe River in Kendall County. The neighborhood, by Lufkin-based DH Investment Co., features million-dollar homes on sites between 1 and 10 acres.
The final build-out should include 2,500 homes and a Jack Nicklaus Signature golf course.
"It's almost mind-boggling," said Rick Kuper of Kuper Sotheby's International Realty. "That is the epitome of what is happening." While Cordillera Ranch doesn't represent a typical development, Kuper said the vast amount of acreage makes sense.
"Texas, California and Florida will have 48 percent of the nation's growth between now and 2045," Kuper said. "The other states are overpriced. We're undervalued. The national builders do their homework and San Antonio is in the bull's-eye." "Good, bad or indifferent," Kuper said, "we're going to see incredible growth."
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