A range of housing options in Austin, reflecting the city's evolving housing policies.
Austin’s HOME initiative, launched in February 2024, aims to address the city’s housing challenges by allowing developers more flexibility to build. After six months, the Development Services Department reported 159 applications and 99 approvals, mainly for two-unit developments. However, the anticipated increase in tiny home applications has not materialized, and preservation efforts for older buildings remain low. As the city faces ongoing discussions around housing equity and affordability, the next phase of the initiative is set to encourage more significant changes.
Austin, a city known for its lively culture and booming population, has just released a report highlighting the first six months of the Home Options for Mobility and Equity (HOME) Phase 1 initiative. The program, which launched in February 2024, was designed to tackle Austin’s persistent housing challenges by allowing developers to construct up to three units on single-family lots.
All eyes are on the results from the Development Services Department, which recently shared data revealing a total of 159 residential development applications were submitted under the new rules, with 99 approvals granted. Of those, the majority, 72 approvals out of 103 applications, were for two-unit developments. It’s a sign that the new framework is beginning to bear fruit, but there’s still room for improvement!
Interestingly, despite the initiative emphasizing tiny homes as a potential solution for housing shortages, the report showed the city received not a single application for these compact dwellings. Many had anticipated these tiny homes to play a significant role in meeting the demand for affordable options. It seems there’s still a gap between the city’s vision and reality.
The initiative also included a Preservation Bonus program aimed at incentivizing developers to protect Austin’s older buildings. However, participation has been rather low, with only two applications—both from District 1—submitted under this program. Those applications managed to preserve an impressive 91% of the original structures. City staff have already flagged this aspect for further review, hoping to boost its effectiveness in the future.
In another observation, the report noted there were 214 demolition permit applications from February to August 2024. This figure has seen a slight decrease from the previously recorded 222 applications. It’s a small win for those who cherish Austin’s historical charm, suggesting some developers might be reconsidering their approach.
The approved projects averaged about 1,719 square feet per unit, pointing to a mean floor area ratio (FAR) of 0.48. Notably, most of the projects fell within the 0.15 to 0.25 FAR range, indicating a trend towards medium-density housing rather than more compact designs. This reflects a shift from the past, moving away from the much-maligned “McMansion” style.
Despite the mixed results, there’s optimism from former city officials about future developments. A more detailed dataset regarding HOME’s first phase is expected to be available by February 5, 2025. Meanwhile, the Austin Board of Realtors will join forces with the Housing Department to track housing cost data as it relates to the initiative.
The second phase of the HOME initiative is already in the works. It aims to further reduce the mandatory land size for building single housing units from 5,750 square feet to just 1,800 square feet. However, this move has faced some pushback from Council Members who worry about the rapid timeline of these changes.
In recognizing vulnerability to gentrification, an amendment has been added to consider implementing an “equity/anti-displacement overlay.” There is a growing consensus on the need for more significant preservation bonuses that encourage developers to incorporate older homes into their projects, rather than pushing them out in favor of new constructions.
There is a broader discussion taking place about whether deregulation is really the answer to lowering housing prices in high-demand cities like Austin. Many believe that without careful planning, we might see further displacement in some neighborhoods that could benefit from more affordable housing options.
As Austin navigates these new waters, the resolve of its residents and leaders will be put to the test. With ongoing discussions and forthcoming changes, all eyes will remain on how the city manages its housing challenges and strives for a vibrant, inclusive future.
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