I have long said that following Austin politics is like watching a soap opera, including that you can miss several episodes then catch up quickly. I use that analogy because, as I hope a few folks noticed, I have been on a six month plus break from publishing.
Now, here’s an important programming announcement: what is perhaps Austin’s longest running political soap opera — the Land Development Code (LDC) rewrite — is coming back for a few new episodes before the end of the year. (The LDC saga has run since 2012 or since the mid-1980s depending on how one looks at it.)
The big announcement came from Mayor Steve Adler in his final State Of the City Address (SOCA) back on August 25. Quoth the Mayor, “We must fix the Land Development Code to unlock the needed housing supply. We must reinvent the development process, so that building in Austin no longer costs too much and takes too long.” Adler then specifically referred to ongoing efforts to pass at least some code amendments before he and at least one LDC ally leave office in early January: “Final ordinances should be passed before the end of the year,” promised the Mayor, who then added pointedly, “We didn’t give up.”
Adler’s contention that the LDC slows down housing approvals and makes housing cost more is of course a core argument by backers of the LDC rewrite. This talking point is often accepted as a given in media coverage. And, there is actually fairly widespread agreement that the LDC is unnecessarily cumbersome to use. Disagreement of course sets in on discussion of solutions. The bulk of opposition, however, is not to removing unnecessary or duplicative obstacles to building, or to speeding up the development process. The core opposition is to the mass of other complications, particularly the massive upzonings that Adler and his Council allies insisted on cramming into the LDC package (more on that in a future installment).
In any case, arguments like Adler’s work best if the current LDC is actually slowing down housing approvals — or slowing them down to anywhere near the crisis level claimed by Adler, urbanists, and many developers.
That does not appear to be the reality. Consider this from the Kinder Institute for Urban Research at Rice University (commenting on a Rent.com review of national housing activity during the first year of the pandemic): “Austin punched way above its weight on housing production. . . Measured on a per-capita basis — the number of housing permits issued divided by the total population — Austin’s housing production was way ahead of any other city in the nation. The only city on the Rent.com list that came remotely close to Austin on a per-capita basis was Nashville, which is experiencing a similar boom in population and home prices.”
“We must fix the Land Development Code to unlock the needed housing supply.” Mayor Steve Adler
This pattern continued into 2022 and it’s not exactly a secret. For instance, a May 2022 Redfin report said Austin is #1 in both single family and multifamily building permits per capita during the first quarter of 2022. This news was reported fairly widely in local media and even made national media. For instance Axios published a June story on the Redfin report with the headline, “Austin leads the nation in homebuilding.” Local media outlets reporting on the Redfin data included the Austin Business Journal, with a story by Editor Colin Pope headlined, “No big U.S. city is building more homes per capita than Austin, Redfin says.” KXAN, a news “partner” with the ABJ, ran a similar story with the headline: “Redfin: No big US city is building more homes per capita than Austin.”
“Austin punched way above its weight on housing production. . . Measured on a per-capita basis — the number of housing permits issued divided by the total population — Austin’s housing production was way ahead of any other city in the nation.” Kinder Institute, Rice University
And, Austonia reported: “Austin had more single-family building permits per capita than any other metro in the country in the first quarter of 2022. Austonia added another point that is very relevant to Austin’s LDC discussion, “the city is doing more than just building that quintessential single-family home: Austin also topped the list for new multifamily property permits, with 26.1 permits per 10,000 people in the same quarter.”
But, What About Within the Austin City Limits?
When it comes to Austin’s LDC there is an important point to note about the above data. As reported in one of the quoted passages above, this is data for the Austin metro area, not just the City of Austin. Backers of the LDC rewrite, including Adler and the LDC Council majority, are particularly focused on increasing the percentage of new housing within the Austin metro area that is going into the city limits — as opposed to the rest of the metro area. So it is important to analyze building permit data inside the city limits and to compare that to other cities.
The Independent discovered that exact numbers to compare different cities are very difficult to find. Most data sources report metro area data only. There is, however, a widely used (especially in academia) federal database called the SOCDS Building Permits database (the Housing and Urban Development Department’s State of the Cities Data Systems) which can be used to compare numbers from within cities.
Those numbers show a pattern within the city limits that is very similar to the one for the metro area.
- According to SOCDS numbers, the City of Austin issued far more building permits for housing during the last five years than Houston, Dallas or San Antonio — the three Texas cities with a larger population than Austin.
- According to SOCDS figures, during the overall five year period from 2017-21 Austin issued 75,983 building permits for housing while also booming Houston — which doesn’t even have zoning — issued 70,206 .
- In the five year period, 2017-2021, Houston was the only one of those three larger Texas cities that issued more building permits than Austin even once. That was in 2019.
- Meanwhile Dallas and San Antonio combined issued just over a thousand more building permits than Austin.
The Independent reached out to the Austin’s Development Services Department (DSD) about the SOCDS numbers and also asked for their numbers for the same period. The City/DSD declined to comment on the SOCDS numbers: “Regarding both the SOCDS and Kinder Institute data, without detailed knowledge of their methodology, we cannot provide insight into the differences in our data.”
DSD did provide building permit numbers to the Independent and they were slightly lower, but not significantly different, than the census based SOCDS data. DSD reported 72,392 building permits to the Independent for the 2017 through 2021 period; four percent less than the SOCDS numbers. This number is still higher than the SOCDS numbers of all other Texas cities, including Houston, even though the City of Houston’s population is is more than double the City Austin’s.
(The Independent was unable to obtain corresponding numbers from the other cities by press time. Collecting the data individually, however, would likely be less precise than the SOCDS numbers. It is widely considered better to use data collected in a standard method, like SOCDS, as opposed to collecting data individually from different sources.)
To summarize, in both the metropolitan area and the SOCDS/inside the city numbers Austin is beating Houston in the number of permits issued. During the five year period Austin beat Houston not just in per capita numbers, but in the actual number of permits issued — even though the Houston city population is more than double Austin’s and Houston’s metro area population is more than triple that of the Austin metro area. Given that, the four percent difference between SOCDS and City of Austin numbers would not be enough to change the overall trend, or point.
Then There’s Per Capita Numbers
When per capita numbers rates are calculated Austin leaves the rest of the field in the construction dust. In fact, when per capita numbers are used, Austin pulls out to a Secretariat like lead in both the metro area and within the City limits. (Boomer Alert: Secretariat was a champion race horse who won the 1973 Triple Crown, the first Triple Crown winner in 25 years. He won the 1973 Belmont Stakes, the final leg of the Triple Crown, by 31 lengths. Watch below both to see the race and to get an idea of how far ahead of the rest of the country Austin is in issuing building permits, even though our mayor says a new LDC is needed to “unlock” the housing supply.
Austin’s national leadership status on building permits within the city limits can be seen in the graph below. The points fit around a line that shows the relationship between a city’s population and building permits. Those above the line performed above normal. Data is from the HUD SOCDS building permit database.
The Secretariat style lead for Austin is more apparent in the graph below which illustrates how high above or below the average, based on population, the cities have performed. The graph also shows which cities are “punching above their weight.”
Turning to the per capita numbers of the three booming Texas cities that are bigger in population than Austin, our town once again leaps to a Secretariat style lead. That graph can be found at the top of this story. The source is also SOCDS.
Conclusion, Part 1
So, given the metro data and the city comparisons in SOCDS, Mayor Adler’s claim that a new LDC is needed to “unlock the needed housing supply” just doesn’t stand up to numerical examination. A big irony here is that Adler and the 10-1 Council — as the policy making body of the City for almost eight years — should be able to take at least some credit for the rapid pace with which the Development Services Department is pumping out building permits. But, admitting that and taking some credit — even in a speech designed to tout accomplishments — works against the Adler-Council Majority narrative on the LDC. So they have to keep whatever credit they deserve for that to themselves.
Next: A comparative look at building permit numbers for apartments, plus a look at another factor that might be driving high housing prices, and a nostalgic look back at the “Austin Bargain.”
Coming Soon: An examination of how voting lockstep with developers became synonomous with being a “progressive” Council Member.
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