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Is Boerne, Texas a good real estate investment?

Boerne's fundamentals support long-term value: 20.3 percent Kendall County population growth from 2020 to 2025 driven by domestic migration, six straight A ratings for Boerne ISD, and land and groundwater constraints that limit new supply. Cash flow is the hard part, because Texas property tax rates and Hill Country prices compress yields.

The appreciation case, stated in verifiable terms

Demand. Kendall County grew 20.3 percent between 2020 and 2025, from an estimated 44,568 to 53,289 residents, and the growth came mostly from domestic migration (Community Impact). In-migrating households form demand immediately and arrive with prior-sale equity.

Sorting pressure. Boerne ISD has held a Texas Education Agency "A" rating for six consecutive years (Boerne Star). School ratings are the primary filter relocating families apply before they look at a listing, and that filter concentrates demand inside district boundaries.

Constrained supply. Hill Country terrain limits finished-lot yield per acre, and groundwater across Kendall County is regulated by the Cow Creek Groundwater Conservation District (ccgcd.org). A project that cannot document water does not get built at the density its pro forma assumed. Rising demand against constrained supply is the whole appreciation thesis.

Access. Boerne sits roughly 31 miles northwest of San Antonio on I-10 (City-Data) — commutable to a metro job market while remaining a separate town with its own downtown, county government and school district.

None of those four reverse quickly. That is what "fundamentals" means.

The cash flow problem, stated honestly

Appreciation and cash flow are different businesses. Boerne is better at the first than the second, and the reason is on the tax bill.

For a home inside the city limits in Boerne ISD, the 2025 adopted rates per $100 of taxable value were:

Plus any special district on the parcel. Kendall AD lists Kendall County MUD, Miralomas MUD, Cow Creek Groundwater Conservation District and Kendall County WCID #1 among entities that can appear on a bill (Kendall Appraisal District).

Two consequences investors miss:

  1. An investment property gets no homestead exemption and no 10 percent homestead cap. The 10 percent cap on annual increases in net appraised value applies only to property that already carries a homestead exemption (Texas Comptroller). Your rental is reappraised at market value with no such cushion.
  2. The partial substitute is expiring. The circuit breaker in Tax Code §23.231 caps appraised value increases at 20 percent per year for non-homestead real property at or below an annually indexed threshold. It was created by SB 2 (2023) as a pilot for tax years 2024, 2025 and 2026, and it expires December 31, 2026 unless the Legislature renews it (Travis CAD). It excludes land under agricultural special appraisal and homesteads under the 10 percent cap. An investor underwriting a Boerne rental on 2026 assessed value should model what happens if that cap lapses. A CPA or tax advisor is the right person to run that scenario.

On the price side, published Boerne figures are third-party model estimates that move. Zillow reported an average Boerne home value of roughly $554,983 as of September 2026 (Zillow) — not a closed-sale statistic. Get current MLS sold and rent comps for the specific ZIP and property type before underwriting anything.

The short-term rental angle, and its ceiling

Boerne is a destination town, which makes nightly rental the obvious yield play. It is also regulated. Boerne has its own ordinance — No. 2023-09 — and San Antonio's STR rules do not apply here. Key terms: $200 registration fee, two-year permit term, $200 renewal within 30 days of expiration, safety inspection required inside city limits ($100 with a city inspector) but not in the ETJ, minimum liability insurance of $500,000 per occurrence and $1,000,000 aggregate, occupancy of two per bedroom plus two, one parking space per bedroom, events prohibited, and — the deal-killer — an STR may not operate within 200 feet of another STR on the same block face in residentially zoned areas (City of Boerne).

Hotel occupancy tax is 13 percent combined: 6 percent state plus 7 percent City of Boerne (City of Boerne).

The failure mode is specific: an investor buys the block closest to the Hill Country Mile because the nightly rate justifies the price, then discovers the block-face allowance is already consumed by an existing permit holder. Confirm the specific address with the City of Boerne Planning Department, (830) 248-1501, inside the option period. And a city permit is not a POA's permission — deed restrictions are a separate question for a Texas real estate attorney.

Land plays are a different instrument

Raw Hill Country acreage does not cash flow, and untaxed it carries a real holding cost. 1-d-1 open-space appraisal values qualifying land on productivity value rather than market value, and requires current principal agricultural use to the degree of intensity generally accepted in the area, with agricultural or timber production in 5 of the preceding 7 years. Wildlife management use requires previously qualified open-space or timber land used in at least 3 of 7 specified ways. Changing use triggers a 3-year rollback tax — the difference between taxes paid on ag value and what would have been paid on market value (Texas Comptroller).

Buying ag-valued land and developing it converts a low carrying cost into a rollback liability. That math belongs to a CPA, and the qualification question belongs to Kendall Appraisal District.

If you are exchanging in

IRC §1031 allows deferral on real property held for productive use in a trade or business or for investment. After the Tax Cuts and Jobs Act it applies only to real property. The clocks: 45 days from transfer of the relinquished property to identify replacement property in writing, and 180 days to receive it, or the due date of the return including extensions, whichever is earlier. Reported on IRS Form 8824. A personal residence does not qualify (IRS). Work with a CPA and a qualified intermediary before the relinquished property closes, not after.

The honest verdict

Buy Boerne for a long hold, for land you cannot replace, or for a resale-price thesis backed by school ratings and in-migration. Do not buy it expecting a Midwest cap rate. And run the tax line at full market value with no exemption before you sign anything — that is the number that kills Hill Country pro formas.

Related questions

Questions about a specific property?

Call or text 830-446-3847 · Email heath.shepard@kw.com

This is not investment, legal or tax advice. Talk with a CPA about depreciation, rollback taxes, the circuit breaker and 1031 timing, a lender about financing structure, Kendall Appraisal District about valuation and exemptions, and the City of Boerne Planning Department about short-term rental eligibility for a specific address.

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