New Report Says Regulations Drive Housing Costs

The Texas Public Policy Foundation's Taxpayer Protection Project released new research examining housing affordability in Texas, arguing that restrictive local regulations and rising property taxes are making homeownership increasingly difficult.

The report identifies a statewide housing shortfall of 306,000 homes, declining building permits, and a median home price of $321,000 as evidence of a supply-driven affordability crisis. It argues that restrictive zoning, large-lot requirements, and regulatory fees limit construction as Texas' population grows.

According to the research, government regulations account for 23.8% of the cost of a new home, or $93.87, and 40.6% of multifamily housing costs. The report identifies these regulatory expenses as major contributors to the state's housing affordability challenges.

Property taxes are another focus. The foundation estimates that Texas property taxes totaled $89.4 billion across nearly 5,000 taxing units in 2025, a 364% increase since 1998. The report argues that property tax growth has substantially outpaced the combined effects of population growth and inflation.

"The only way the Texas Miracle can continue is if people can afford to live here. A shortage of housing and rising property taxes have made owning a house difficult for all Texans," said Jose Melendez, campaign director for the Taxpayer Protection Project.

Policy Director James Quintero said 90% of Texans consider housing affordability a problem and called on state lawmakers to rein in local government spending and reduce regulatory barriers.

The foundation also unveiled its Texas Housing Regulation Cost Tool, which allows residents to look up their city or town and examine the estimated costs of local housing regulations.

The research and tool reflect the foundation's position that reducing regulatory restrictions and controlling property taxes can improve affordability. The findings and cost estimates were presented by the organization and were not independently verified in the announcement.