8th-10th REI Property(Land in Texas)

[V.G Jason]

Investment Info:

Bought some land in Fredericksburg Texas to create an STR for those avid hunters and wining trips. Been invited to plenty over the years, rarely and barely went. Understand the appeal, will market to it. Other side of the property I am going to build a little ranch house for my family.

8th-10th REI Property(Land to build STRs)
List Price: $161,000
Purchase Price: $147,500
Financing: Cash
Size: Little over a half acre(about 22k sq ft)
Build: Current design is 3 STRs

1 House- 4,000 SQ FT 5 bedrooms/4.5 bathrooms with expansive backyard incl large pool(full size lot is 6,300 sq ft)
1 House- 2,100 SQ FT 3 bedrooms/3 bathrooms with backyard small pool & hot tub(full size lot is 3,100 sq ft)
1 House- 1,600 SQ FT 2 bedrooms/2bathrooms limited backyard with hot tub(full size lot is 2,200 sq ft) 

Prices are coming at about $225sq/ft for the 4k house, $208/sq ft for the 2.1k house and I'm able to do the 1.6 house for about $188.5 sq/ft.

Costly to build, don't think it'll cash flow for the first 2-3 years but I'm betting this area picks up to due location and proxy to major areas. It's also an area I've wanted to get into for personal years since the start of Rona.

[Ian Fortney]

Hi!  

Wanted to post some things here to make sure you are good to go on STRs in Fredericksburg.

Can you share the address or which zone the property is? If you don't know which zone your property is in, you can find it here

Depending on what zone you are in will really determine some of the requirements for your STRs. As you probably know, last year they past stricter STR laws with STR Ordinance No. 2022-13. The major changes with this compared to the previous ordinance is parking, occupancy limit and lot size requirements.

Lot size requirements: 

- R1: 7,500 sq ft lot or 10,000 sq ft if building a guest house or accessory unit) minimum  

- R2:  5,000 sq ft lot minimum

- R3: 7,500 sq ft lot minimum

Looking at those minimum lot sizes, there's a potential that none of your houses will qualify for a STR permit. Now if you were in R2, then your first house will, but not the other two. Granted, there's a lot of different zones and yours may not be one of the ones above. Before proceeding, I would not only read over the ordinance, but also talk to Jan Musgrove who looks over STR permits for Fredericksburg.

I am currently under contract and set to close pretty soon on a STR in R2, which is how I am intimately familiar with these ordinances. Let me know if I can answer any other questions!