matthestMar 19

Austin’s surge of new housing construction drove down rents

https://www.pew.org/en/research-and-analysis/articles/2026/03/18/austins-surge-of-new-housing-construction-drove-down-rents

Austin’s Surge of New Housing Construction Drove Down Rents

After decades of explosive growth, Austin, Texas, in the 2010s was a victim of its own success. Lured by high-tech jobs and the city’s hip reputation, too many people were competing for too few homes. From 2010 to 2019, rents in Austin increased nearly 93%—more than in any other major American city. And home sale prices increased 82%, more than in any other metro area in Texas.

Show threadpclowesMar 19

Its wild how the solution to housing costs is really just:

Build more housing. Keep law and order.

No it doesn’t need to be “affordable”. Yes rent control is a terrible idea.

Just build more housing.

Note: that the US already has plenty of housing and housing costs basically go up in areas of low crime relative to economic opportunity. If you build housing, but allow crime to rise, you have wasted everybody’s time.

Show threadestearumMar 19

New construction has already decelerated in Austin due to falling prices, which compresses already-near-zero margin on real estate development.

So yes, it really is "just build more housing." The problem is: why would you build more housing as prices fall?

Show threadcuuupidMar 19

It's not necessarily prices falling here but the profitability of [demand] at [price]. Like if prices fall 10% but demand rises 20%, you would want to build more housing.

This is the beauty of the free market because it guarantees three things:

[1] Real estate is generally a good investment and will hold value or appreciate in the long term, because supply will adjust to demand shocks to rescue values

[2] If people want to live somewhere, houses will be built for them to live there

[3] Real estate developers and construction are solid, safe businesses with great unit economics because building may decrease prices, but may still increase demand

It's when you constrain and restrict a market that players have to adjust and then you get crazy scenarios

Show threadkomali2Mar 19

It seems to me that the market will select for urban sprawl though which is a negative for society but has the highest margin. E.g. Houston suburbs, miles and miles of cheap to fab single family homes that turn it into a suburban hell scape where you have to drive everywhere.

I don't think the free market is giving the promises you say it is - supply isn't elastic for real estate if nobody's building because there's no margins. Demand can be anywhere really.

I like to look to Tokyo for an example. Small lots, extremely predictable regulations (that are still strict enough to ensure a safe living situation), fast approvals, mean it's much faster and easier to throw up an 8-10 story apartment than say downtown Austin, and so even today they keep doing it despite land in Tokyo being very expensive. And, no sprawl.

Show threadtaorminaMar 19
Have you seen Tokyo?
Show threadkomali2Mar 19
I've lived in Tokyo and Houston. Tokyo is infinitely more livable and the housing is still relatively affordable. In Houston even if you can get a new place it'll be clapboard garbage that's a one and a half hour drive from work.
Show threadhunterpayne
Average home price in Tokyo is 1.5x that of Houston. Average wage in Houston is 1.5x that of Tokyo. So the data doesn't support your post unless you really really love sushi and arcades.
Mar 19 at 5:22amWeb