Texas Comptroller Unveils Report Highlighting Housing Affordability Crisis

Texas Comptroller Glenn Hegar announced the release of his agency’s Housing Affordability Challenge report, which explores factors contributing to the housing affordability crisis in the U.S., its impact on Texans, and how Texas compares to the rest of the country.

“Texans continue to suffer from elevated prices and high interest rates that put significant upward pressures on the costs of borrowing and home ownership, and so this report covers an immediate issue,” Hegar said. “Simply put, our state, which is generally well regarded for its low cost of living, is facing the pressures of a decline in housing affordability as our population and demand for housing continue to rise. Since 2008, Texas has been the No. 1 state for new building permits for privately owned housing units. However, the state’s population, particularly in the major metropolitan areas, is growing at a quicker pace than housing is being built.”

Key Findings

The Housing Affordability Challenge report highlighted several key findings:

• Decline in Housing Affordability: Affording a home is increasingly difficult in Texas and across the U.S. Between 2021 and 2023, the country experienced its fastest-ever decline in housing affordability due to rising home prices and interest rates. In Texas, median home prices rose by 40% between 2019 and 2023.
• Housing Supply Shortages: Despite Texas leading the nation in building permits since the 2007-2008 financial crisis, the state was still short 306,000 homes in 2023, according to an analysis by the nonprofit organization Up for Growth. This shortage disproportionately affects lower- and middle-income buyers and first-time homebuyers.
• Rising Associated Costs: The lack of affordability extends beyond housing prices and mortgage rates. Homeowners’ insurance rates in Texas rose by 6.9% in 2021 and 11.8% in 2022. High interest rates and personal credit scores also pose barriers to prospective homebuyers.
• Regulatory and Zoning Adjustments: Changes to regulations, zoning codes, and ordinances could help ease the affordability crisis. While there is bipartisan support for building more housing, opinions differ on how to achieve these goals. Some advocate for relaxing zoning regulations to encourage more housing development, while others worry about potential negative impacts on neighborhood structures and property values.

“Lawmakers have taken critical steps in recent years to lower the overall cost of home ownership by reducing the property tax burden on Texans, and we are making progress as a state toward lowering artificial barriers and removing regulations that limit or inhibit home building,” Hegar said. “But this issue remains daunting and key to our continued overall economic health. My office will continue to work with legislators to provide support as they work to address this issue and prepare bills for the upcoming legislative session.”