Homes are more affordable in places like Austin and Houston, Texas; Charlotte, North Carolina; Greenville, South Carolina; and Provo, Utah, than in other U.S. cities because these metro areas embrace and plan for outward suburban growth to a much greater degree than other metros.
If all metropolitan areas in the United States had housing and land-use policies similar to those in the 25 large, fast-growing metros in the Sun Belt and Mountain states, America’s 250 largest metros would have added about 5.6 million more homes from 2010 to 2023 than they actually did, the George W. Bush Institute-SMU Economic Growth Initiative estimates in a new report. Increases in housing supply would have kept average home prices some $115,000 below today’s levels, while monthly rents would be $450 lower, the report shows.
Our method: We estimate demand and supply curve relationships for each of the nation’s 250 largest metro areas and use these to calculate how each metro’s housing growth and price levels would have changed if every metro’s supply curves – the quantity of housing a metro would add at all possible price points – closely matched that of the average for our 25 Sun Belt-Mountain metros. See our main report for a full explanation of sources and methods.
America would have avoided much of its current housing shortfall with the additional homes that would exist today if the whole country matched the policies of the Sun Belt metros, the report shows. Home prices and rents would have risen only as fast as people’s incomes rather than far faster. This means millions of Americans who are severely burdened by housing costs today would be in much better financial shape.
Our twenty-five highlighted metro areas – including those which score highest in the report’s housing policy rankings – stand out among U.S. metros in the following ways:
- They allow more outward expansion in suburban and exurban areas than most other metros.
- They permit developers to build more housing of all sizes and configurations across a wider range of locations, including relatively attainable midrange apartments and townhomes.
- They’ve also mostly outpaced the rest of the country for implementing pro-growth housing reforms over the last decade.
Housing policies are far from perfect in the fastest-growing Sun Belt–Mountain metros. Some core cities have notoriously difficult permitting processes and above-average geographic segregation along income lines. Many suburban cities in these areas are becoming more reluctant to allow new apartments.
But relatively growth-friendly policies, even if they aren’t perfect, go a long way.
