Dive Brief:
- After a period of soaring rents, a housing construction boom in Austin, Texas, helped drive the city’s median rent down by more than 16% from 2021 to 2026, according to a new Pew analysis.
- Between 2015 and 2024, Austin grew its housing stock by 120,000 units — a 30% increase that far outpaced the overall U.S. growth rate of 9%. Median rent in the city is now 4% lower than the national average.
- A number of housing policy reforms helped pave the way for new construction, including targeted rezoning, parking minimum reductions and cutting restrictions on accessory dwelling units. The city has also focused on subsidizing affordable housing options.
Dive Insight:
As cities across the country face high housing and rental costs, many are exploring regulatory reforms to encourage housing construction.
Austin’s metro population surged 33% from 2010 to 2020, causing rents to skyrocket by nearly 93% from 2010 to 2019.
In 2007, the city created a vertical mixed-use zoning category to incentivize construction, allowing more units per site and reducing minimum parking requirements by 60%. The measure led to more than 17,600 new units built or in the process of being built as of 2024, according to Pew. In 2023, Austin became the largest U.S. city to eliminate parking requirements for nearly every type of property citywide.
In 2015, the city also made it easier to build ADUs, also known as granny flats or coach houses, by reducing its minimum lot size mandate and halving the number of parking space requirements. Between 2015 and 2024, the city permitted nearly 3,000 ADUs, far outpacing its prior rate of permitting.
The city has also pushed for affordable housing construction by implementing density bonuses and using hundreds of millions in municipal bonds to acquire land for new construction.
Rents dropped 7% in apartment buildings with 50 or more units from 2023 to 2024, the largest drop recorded in any large metro area, according to Pew, and rents in older, non-luxury buildings with low-income renters fell approximately 11%.
Austin’s population boom has also started to slow since its meteoric rise.
“Austin’s success serves as an important example of how regulatory barriers to building more housing are often varied and interconnected,” Pew’s report stated. “No single solution can solve a housing shortage, but Austin has taken multiple steps that have helped to unlock large amounts of housing supply in its market and reverse rent growth.”
