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Austin's attempt to build an affordable home in a wealthy area violates property rules, judge says

A fallen chain-link fence around empty land
Patricia Lim
The land at 3000 Funston St. has remained vacant, save for the frame for the foundation of a home, since 2020 when neighbors sued over the development of a home.

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The empty, overgrown plot at 3000 Funston St. in West Austin will remain just that, it seems, after a local judge shut down the city’s attempts to build a home on the land.

On Tuesday, a Travis County district judge ruled city officials violated long established property rules when they began constructing an affordable home on the land in Brykerwoods, a wealthy neighborhood in West Austin. In her decision, Judge Maya Guerra Gamble wrote neighbors would suffer “irreparable harm and injury,” including to the value of their homes, if the city bypassed neighborhood rules in order to build the house — or, any house.

"We are disappointed by the ruling and will explore all legal options and next steps to allow the City ... [to] move forward with important affordable housing goals," a city spokesperson wrote in an email. She did not say whether the city planned to appeal.

An attorney for the neighbors and Marcela Patricia Buenrostro Del Real — the only named neighbor — did not respond to a request for comment Thursday. (A family member answered Del Real’s phone and said she was unavailable.)

The judge ruled the city has to pay Del Real's attorney’s fees totaling roughly $200,000.

Tuesday's ruling follows a preliminary one made in 2020, which halted the city's construction of a home until the full case could be heard.

While the case over 3000 Funston St. revolved around one home on one plot of land in a city of roughly a million residents, it raised an age-old and city-wide question: What rights do neighbors have over what gets built next door?

The City of Austin has owned the land, just east of MoPac, since 1970. In 2020, the city's nonprofit housing arm broke ground on the property. The plan was to build a three-bedroom home that it would sell to a family for less than $300,000 — notable, in part, because homes in this neighborhood sell for more than $1 million.

But before contractors could pour the foundation, a group of neighbors sued, arguing the city could not build because of a document dictating the amount of land needed to build. Commonly found in wealthy neighborhoods throughout the country, deed restrictions establish building rules that neighbors are legally compelled to follow. These rules vary widely, but can restrict how many homes someone can build on their land, how tall these buildings can be and, pertinent to this case, the minimum amount of land needed to build.

The Funston Street plot is about 4,200 square feet. A deed restriction in Brykerwoods states owners need at least 5,750 square feet in order to build a home. (The City of Austin recently voted to lower minimum-lot-size rules, but deed restrictions trump city zoning rules in court.)

The lawsuit also claimed the city could not build because of flooding problems in the area, but that argument was thrown out.

After an appeal and several postponements, the case went to trial in April.

During the daylong hearing in district court, Trey Jackson, the lawyer for the neighbors and a neighbor himself, said the case was nothing more than a contract issue. He argued that when Del Real, the nextdoor neighbor, bought her home in 2013 she did so under the impression that the lot would be left empty — a fact, Jackson said, ensured her home would retain a higher value.

An attorney for the city argued the case was about much more than a contract among neighbors. Alex Valdes claimed the harm done to the public by not building an income-restricted home in a city that needs affordable housing was greater than the harm done by potentially violating this deed restriction.

But throughout the case, Jackson continuously rejected this idea. “This case has nothing to do with affordable housing/low-income families, it’s about following the law,” he wrote in an email to KUT in 2021.

In court, Jackson objected numerous times to the city’s argument, calling it an “affordable housing trap” and an attempt by the city to “politicize [the] case.” Judge Guerra Gamble at times upheld his objections, cautioning the city’s lawyer to not go “crazy” with the affordable housing argument.

This week she solidified this stance, ruling against the city and upholding the neighborhood’s deed restriction.

Correction: An earlier version of this story misspelled the Travis County district judge's name. The story has also been updated to make clear that the Austin City Council's vote to lower minimum lot sizes is not yet final.

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Audrey McGlinchy is KUT's housing reporter. She focuses on affordable housing solutions, renters’ rights and the battles over zoning. Got a tip? Email her at Follow her on Twitter @AKMcGlinchy.
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