Question 1

San Marcos is about to change its impact fees. What does that mean for my construction budget?

Accepted Answer

Price the change into your underwriting now, because the number just moved and it isn't final. San Marcos has been charging water and wastewater impact fees under a 2018 ordinance, about $6,500 total per new connection. On August 5, 2026, City Council approved on first reading, 6 to 1, a maximum of $14,519 per service unit for water and $11,161 for wastewater, a combined $25,680 per new connection, with no phase-in adopted at that reading. The city faces a statutory deadline of September 1, 2026 to finalize the ordinance. The final adopted amount and any vesting or phase-in date were not available when this was written, so confirm the current fee and your plat's vesting status with the city before you set the construction budget line.

Question 2

Does every San Marcos construction loan need a state review before I break ground?

Accepted Answer

If the lot sits over the Edwards Aquifer recharge, transition or contributing zone, yes, and it has to clear before the ground is disturbed. Hays County sits over the Edwards Aquifer, and TCEQ requires an Edwards Aquifer Protection Plan, in most cases a Water Pollution Abatement Plan, approved before construction, land clearing or tank installation starts. TCEQ's own timeline runs up to 30 days for administrative review plus 90 days for technical review once an application is complete, so a heavy-site-work deal can carry four months of state review before the city's own permitting clock even starts. Confirm your parcel's zone on TCEQ's maps and budget the carry.

Question 3

How long should I plan for permitting and inspections in San Marcos?

Accepted Answer

Longer than the building permit alone suggests, and the city has not published a number to hold it to. No plan review turnaround time or expedited review path for San Marcos was found, so do not build your draw schedule around a specific day count. What is documented is the cost of getting it wrong: work started without a permit is billed at double the normal fee, a reinspection runs $263, and each resubmittal after the second costs $315. Build slack into your schedule rather than assuming a fast review.

Question 4

Besides the impact fee, what does San Marcos actually charge to permit a new build?

Accepted Answer

The building permit itself is a small line item next to the site fees around it. San Marcos charges $0.63 per square foot for a single-family residential building permit, about $1,260 plus a $15 technology fee on a 2,000 square foot house. The bigger money is in the site work: a parking fee-in-lieu of $7,875 per space, a parkland development fee of $444 per unit, a sidewalk fee-in-lieu of $20 per square foot, and protected-tree fees of $184 per caliper inch. None of those are the impact fee. They stack on top of it.

Question 5

Is there real demand for what I'd build in San Marcos?

Accepted Answer

Zero units in structures of five or more apartments were permitted in San Marcos in 2025, with all 12 months reported, the same year Texas State posted a record fall enrollment of 44,596 students. Single-family permitting stayed active at 718 units over the same year. Not all of that enrollment growth lands inside San Marcos itself, since the university's fastest growth was at its Round Rock campus and online, so don't underwrite it one for one. Still, a city with no new apartment supply and steady single-family activity is a case for weighing a build-to-rent exit with our DSCR rental loan alongside a straight resale.

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