Rapid Growth Overwhelmed Austin. These Housing Reforms Made a Difference.

For places experiencing rapid population growth, Austin's housing crisis may sound familiar. As demand outpaced supply, costs surged and options dwindled.

The Austin metro was the country's fastest-growing region from 2010 to 2022, according to census data, with the city's population increasing by about 25 percent between 2010 and 2019. During that time, rents soared by 93 percent, Zillow data shows.

An influx of new residents during the pandemic only intensified the housing crisis. "We were losing ground on affordability," says Stevie Greathouse, division manager of the Austin Planning Department.

Although the city's growth has slowed since then, meeting housing demand remains a challenge. However, a series of changes to land use regulations is helping improve affordability and availability in a significant way. "The city has very old land development codes, very old zoning overlays, and a lot of commercial corridors that decades ago were on the outskirts of town," says Brendan Kennedy, program manager of the city's housing department. "The intent was to open those up for housing development."

Around 54,000 new housing units were constructed between 2018 and 2023, and nearly 40 percent were affordable, according to nonprofit HousingWorks Austin. "All this work takes everything firing on multiple cylinders," Greathouse says. "We can't solve our housing crisis with regulations alone, and we can't solve it with subsidies alone. It needs the conversation of aligning regulations and investments, and programs."

Roadmap to New Regulations

Austin adopted its Strategic Housing Blueprint in 2017, which called for over 135,000 new units by 2027, with 60,000 residences for households at or less than 80 percent of the median family income.

Around the same time, the city planned to overhaul its land development code, but the process was halted after facing legal challenges. "Since we weren't able to do that comprehensive work, we've taken on a number of reforms that have really moved forward on a piecemeal basis," Greathouse says.

A light rail train in Austin, Texas. Photo: Getty Images/iStock Unreleased - peeterv

Among the first changes were several code amendments to provide density bonuses in exchange for attainable housing, including Affordability Unlocked. Launched in 2019, the program eases compatibility and parking restrictions for developers if at least half the units are affordable. Nearly 900 units total have been built under the program, city data shows, and of those, roughly 650 are affordable.

Since then, Austin implemented other density bonus programs, Greathouse says, including a program allowing taller mixed-use buildings along a proposed light rail in exchange for attainable housing. Other reforms include the elimination of minimum parking requirements and the adoption of the Home Options for Mobility and Equity (HOME) code amendments, which aim to increase the housing supply in areas with single-family zoning.

The first phase of HOME, adopted in 2023, allows up to three residences on a single-family lot. The second phase, adopted the following year, reduces minimum lot sizes from 5,750 square feet to 1,800 square feet.

Around that time, the city also updated its compatibility requirements, which had "a fairly significant impact on the ability to build multifamily housing," Greathouse says.

These and other reforms, along with more multifamily construction, helped increase supply and reduce rent costs. Having a city council that has "taken our challenges around affordable housing very seriously" and local and state subsidies also have contributed to the city's success so far, Greathouse adds.

Next Steps: Rethinking Processes

Rethinking processes can be as crucial as regulatory changes, Kennedy says, because lengthy and complicated review timelines can deter housing developers from moving forward.

Austin is currently revamping its permitting processes, including site plan reviews, in hopes of making them more efficient. "There's been broad attention to the amount of time that site plans take," says Robert Anderson, a project coordinator for the city's housing department. "So, there's been a lot of executive attention to making sure that we have staff to support on-time reviews."

Increasing deeply affordable housing also continues to be difficult because of factors like high interest rates and rising construction costs. "We just had an affordable housing development that was in the works and pipeline for a long time that will not move forward due to the challenging market conditions," Kennedy says. "That's a frequent occurrence and a challenge we keep trying to overcome."

But planners in Austin are continuing to find ways to utilize public subsidy dollars for deeply affordable housing, as well as providing support services for residents transitioning out of chronic homelessness.

"It's just essential that we try to figure out how to coordinate across departments, agencies, funders, nonprofits, and the community to try to apply regulations, subsidies, and partner programs all together," Greathouse says. "That's the hard part, and that's the joy of planning."

Top image: A view of downtown from East Austin, one of the city's many neighborhoods. Photo: iStock/Getty Images Plus - peeterv.