Here is how I would approach it. Even though San Marcos is in between Austin and SA (32m to Austin and 49 to SA), you have chosen Austin as the focus point so let’s proceed on that note.
You have a great vantage point since you live there.
How is the employment growth in Austin? Are they just McJobs or real jobs? Does it look good?
Jobs look good so next I want to know migration numbers. How many people are moving to Austin? Are people coming and are the numbers on the rise?
What is the housing situation in Austin like? Are the prices on the rise, which is forcing or making people look around for a better deal (IE Las Vegas). If so, places within a short commute might be target migration points.
What is San Marcos like? Is it a low income place? Is it a high class area? How are home prices compared to Austin? If comparable homes are cheaper, it may be a migration point. If they are the same or higher, is there something about San Marcos that is just completely awesome and makes people want to move there?
How is the convenience factor? If I want gas and groceries are there good places within a few minutes or will I have to drive 20 minutes for these things? Are there restaurants of good quality within a 15 minute drive? How about things like Hospitals, Chiropractors, Dentists, etc. Are these in a 20 minute or less drive? If not, are there plans on the table for them?
and so on.
San Marcos has grown by 10,000 residents since 2000. The population as of last year was about 44k. The median home price is about 99k. Considering its size, it seems to be seeing decent growth of about 5% annually.
The median home value in Austin is about 154k.
In San Marcos, there are at least 630 homes on the market. I don’t know what % of the new residents are renters but based on a 2500 per year growth, that is about 200 people per month moving there. Should be a buyers market galore right now.
Austin is growing, from what I saw, at 2% annually, which is ok since they have just over 600k residents, but not spectacular. That is 12k per year, 1k per month. There are over 7,000 homes on the market in Austin right now.
For me, I am not sure this all adds up to leaving the Austin market to go speculate.
You also have another outlet to soak up movers, Cedar Park, which is to the north and 15 miles closer. It is growing faster and more viable. There are around 30k there now and the growth projection has them at 400,000 in 2010. That is some serious growth. 370k more people in 5 years? Wow. That is Vegas type numbers. If they even hit half that, it is nice.
Nice thing is you are there though and can spend time in the area and see what is happening on the battlefield.
Sorry for rambling on. Man, I need to cut my post sizes down.