Where Investors Are Buying in Texas

Texas remains one of the most active investor markets in the country, but the playbook has shifted. Higher rates, tighter insurance, and resetting appraisals have pushed serious capital into specific corridors and away from others. Here's how experienced investors are deploying across San Antonio, Seguin, New Braunfels, and the surrounding growth markets — and what underwriting actually looks like in 2026.

Reggie BenjaminOctober 4, 2025

San Antonio core

South, east, and select northeast pockets of the San Antonio core continue to attract BRRRR, buy-and-hold, and small multifamily investors. South-side ZIPs around 78211, 78214, 78221, and 78224 still produce entry-price deals that pencil for long-term hold, though the days of any-house-works are long over. The east-side path — including portions of 78202 and 78203 — has tightened as appreciation closed the value-add window in many blocks. Selected Northside infill (parts of 78213, 78228) attracts small multifamily and duplex/fourplex investors. The investor we see succeed here is selective on basis, conservative on rent assumptions, and clear-eyed about property management cost. Cash flow targets vary by entry strategy — value-add BRRRR is targeting different metrics than turnkey buy-and-hold.

I-35 corridor — Schertz to Seguin

The I-35 northeast corridor is the busiest single-family rental absorption zone in greater San Antonio. Schertz and Cibolo continue to draw tenant demand from Randolph AFB families, SCUCISD pull, and a steady commute to either San Antonio or New Braunfels — meaning rentals lease quickly and turnover stays manageable. Seguin is where entry-price BRRRR plays still pencil; appreciation has trailed Schertz/Cibolo, but rent has held, and basis remains accessible. New Braunfels (Veramendi, Mayfair, older central sections) draws executive-rental and corporate-housing demand, particularly tied to Comal ISD and growing employer base. Investors who succeed on this corridor watch property tax notice cycles closely and stress-test insurance renewal scenarios — both have moved against the underwriting that worked five years ago.

I-10 East and southeast Bexar

The I-10 East and southeast Bexar growth ring — Converse, southeast Universal City, parts of southeast Schertz, and into the Floresville path — attracts entry-price rental investors and small BRRRR plays. The pull is basis and proximity to Randolph and JBSA-East employment. Watch insurance and tax assumptions closely on anything south or southeast of 410, where carriers have repriced and county appraisals have caught up to recent comps. New construction build-to-rent deliveries are starting to land in this corridor and will affect existing rental pricing — model rent escalation conservatively.

Hill Country edges and STR

Selective short-term-rental plays exist in Spring Branch, Canyon Lake, and parts of Bulverde — but STR underwriting in 2026 has narrowed considerably. Regulation varies by jurisdiction (HOA-level, county-level, and city-level overlap), seasonality drives revenue concentration heavily into late spring through summer, and management cost stays high. Investors making STR work in this corridor are typically buying for blended use (personal Hill Country home plus rental income) or are building portfolios with established management infrastructure. Pure STR-cash-flow underwriting is harder to make pencil here than it was in 2021-2022.

Build-to-rent and small portfolio

Build-to-rent activity has accelerated in San Antonio and the I-35 corridor. Some investors are building 4-12 home portfolios on builder lots with negotiated package pricing, then leasing through professional management. Others are acquiring small (5-20 unit) multifamily in older San Antonio neighborhoods for value-add holds. Larger build-to-rent and institutional multifamily routes through Executive Real Estate Group's commercial channel, which is structured for assignments at scale.

Underwriting expectations

Conservative is the watchword. We model cap rate, debt service coverage ratio (DSCR), property tax escalation (Texas reappraisals can move 8-12% on a single year for purchased property), insurance escalation, vacancy reserve, maintenance reserve, and at least one downside exit scenario before recommending offers. DSCR-financed acquisitions need to clear the DSCR threshold with a conservative rent figure, not the optimistic rent figure. We don't recommend leveraging on best-case rent assumptions — too many 2021-2022 deals are now upside-down on that exact mistake. Final loan structure and qualification are determined by a licensed lender.

Insurance, tax, and exit watch-outs

Three line items have shifted underwriting in Texas since 2022 and deserve direct attention. Insurance: carriers have repriced and dropped capacity in parts of Texas, and renewal premium can be materially higher than the inherited policy. Always quote renewal pre-purchase. Property tax: Texas reassesses to market on transfer, and county appraisal districts have caught up to comparable sales in most growth corridors. Underwrite with a fresh tax estimate, not the seller's last-year bill. Exit: liquidity differs by corridor. Schertz/Cibolo resale is liquid. Older south-side and east-side resale runs longer days-on-market and pickier financing. Model exit before purchase.

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Frequently Asked Questions

What's the best San Antonio neighborhood for buy-and-hold rentals?

It depends on strategy. Schertz, Cibolo, and parts of Converse lead for stable turnkey holds with strong tenant pull. South-side ZIPs (78211, 78214, 78221) still produce entry-price BRRRR opportunities with the right basis. Seguin offers entry-price acquisition with held rents. We match neighborhood to your strategy, target leverage, and hold timeline.

What cap rate should I expect in San Antonio?

Cap rates are deal-specific and depend on asset class, condition, location, and underwriting assumptions. Single-family buy-and-hold in San Antonio typically runs lower cap than industrial/flex or value-add multifamily. We model cap rate alongside cash-on-cash and DSCR rather than relying on a single metric.

Are short-term rentals still profitable in the Hill Country?

Selectively. Spring Branch and Canyon Lake STR can work for the right property with the right management, but underwriting has narrowed considerably from 2021-2022. Regulation, seasonality, and management cost all matter. Pure STR-only underwriting is harder to make pencil than blended-use scenarios.

What does property tax escalation look like in Texas after purchase?

Texas reassesses to market on transfer. Depending on county appraisal practice and recent comparable sales, the new tax bill can run materially higher than the seller's prior bill — sometimes 15-30% higher in a single year on a purchase that triggers reassessment. Always underwrite with a fresh tax estimate, not the prior-year bill.

Should I form an LLC before buying my first rental?

It depends on insurance strategy, financing structure, and tax/asset protection goals. Talk to a CPA and attorney before structuring. We help investors map property strategy alongside their CPA's and attorney's guidance — we don't provide tax or legal advice.

How do I find off-market deals in San Antonio?

Most off-market deal flow comes through relationships — agents, wholesalers, attorneys, and CPAs who know investors are buying. We route off-market opportunities to qualified clients in our investor network and pre-screen for basis, exit, and underwriting fit.

Is build-to-rent worth it in the San Antonio metro?

It can be, particularly on negotiated builder package deals where basis comes in below retail comps and rent absorbs cleanly. The math depends on builder incentive structure, financing, and target hold period. We help model BTR scenarios against acquisition of existing rental product before recommending.