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USA Real Estate Blog

How Land Use Regulation Threatens Texas

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My Manhattan Institute colleague Connor Harris just put out a study urging Texas to liberalize restrictive urban zoning codes. You can download the the entire thing in PDF form. Here’s the executive summary:

Millions of Americans have found well-paying jobs and affordable houses in the rapidly growing cities of the South and Southwest. The Sunbelt’s low taxes, extensive road networks, and easy growth into undeveloped land have provided upward mobility and prosperity at a far lower cost of living than the Northeast and California. Nowhere better exemplifies the Sunbelt model than the Texas Triangle, which encompasses Dallas, Fort Worth, Austin, San Antonio, and Houston.

Although laws in the Texas Triangle facilitate “horizontal” growth through exurban development, they restrict “vertical” growth, or the redevelopment of built areas. Even cities with loose zoning codes, such as Houston, impose some restrictions.

Thanks largely to restrictions on housing supply, house prices in the Texas Triangle have become markedly more expensive. This suggests that restrictions on vertical growth are beginning to cause a housing shortage in the region’s more desirable areas. As horizontal growth reaches its limits, this shortage will only worsen. Unless restrictions on dense development, especially in central cities, are loosened, the Texas Triangle may come to resemble Los Angeles: a sprawl of unaffordable housing, slow transportation, and diminished social mobility.

Click through to read the entire report.

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