“This problem is so big, there’s not enough money to buy your way out. Some policymakers try to do demand-side incentives to buy off mortgages or supplement rent. If you don’t increase supply, those demand-side incentives have unintended consequences that actually make the problem worse.”
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“A major way that Texas has kept prices down is through building gobs of new housing. Lone Star State jurisdictions collectively permitted about twice the number of new homes that California did last year, despite the state having around 8 million fewer residents.
Data culled by the Financial Times shows that the difference in per capita building is even more pronounced when one compares cities like Austin and Houston to San Francisco, which is in turn reflected in prices. Median home prices in Houston are a quarter of what they are in San Francisco.
The state has some of the most affordable housing of all the booming sunbelt states (save North Carolina) and is more affordable on average than the U.S. as a whole.”
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“Part of Texas’ housing success is its uninteresting geography that Glock alluded to—lots of flat, dry land around its major cities that’s ideal for building new exurban subdivisions.
“A couple of the metros might have some physical constraints, but not really,” says Jacob Wegman, an associate professor at the University of Texas Austin’s School of Architecture. It’s “nothing compared to the California coastal metros or the Northeastern metros with their harbors. That’s got to be part of the story.””
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“Texas’ policies also put no real regulatory obstacles in front of new suburban housing either. The state’s counties, for instance, can’t adopt zoning laws. That means housing is allowed on all unincorporated land.
High-cost, low-growth California and New York both have environmental laws that require endless studies on new development, and which give third parties the right to sue over new housing approvals. The result is new subdivisions can take half a century to approve.
Texas, in contrast, has no such laws.
“There’s just no real mechanism for neighbors who don’t want greenfield development to happen to stop it in any meaningful way,” says Wegman. “That’s got to be a big, big part of the story.””