Everything really is bigger in Texas – especially the apartment building boom that’s reshaping the nation’s housing landscape.
Texas is having a moment. While much of the country grapples with housing shortages and construction slowdowns, the Lone Star State is building apartments at a breakneck pace that’s leaving other regions in the dust.
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The Numbers Tell the Story
According to a new RentCafe report, Texas metro areas are dominating the national housing construction scene. Austin, Houston, and Dallas alone are on track to complete more than 70,000 new apartments in 2025 – that’s more units than the entire Midwest combined.
The state’s impact extends beyond just apartments. Despite housing only 9% of the U.S. population, Texas accounts for 15% of all new home construction permits nationwide, making it the undisputed leader in new residential development.
What’s Fueling This Unprecedented Growth?
Population Explosion
The foundation of Texas’s housing boom is simple: demand. Between 2020 and 2024, the state welcomed 2.1 million new residents – a staggering 7% population increase. This massive influx creates an immediate need for housing that developers are racing to meet.
“The more people that show up in a community or a region, the more demand there will be,” explains Daniel Oney, research director at Texas A&M University’s Texas Real Estate Research Center. “Developers try to anticipate that demand and build apartments to meet it in the next eighteen months.”
Geography as an Advantage
Texas has a natural advantage that many states lack: flat, developable land. Unlike regions constrained by mountains, hills, or coastlines, Texas offers vast expanses of easily buildable terrain. This geographic gift translates directly into lower construction costs and faster project timelines.
The Regulatory Difference
Perhaps most crucially, Texas takes a notably different approach to development regulations. Shorter plan review processes mean developers face fewer bureaucratic hurdles and delays. In Houston, for example, zoning functions through local covenants and deed restrictions rather than city-wide zoning laws, leaving vacant and agricultural land free to develop according to market demand.
This regulatory approach aligns with arguments made in Ezra Klein and Derek Thompson’s 2025 book “Abundance,” which critiques how well-intentioned democratic processes can inadvertently create regulatory systems that prevent essential infrastructure and housing development.
The Cost Advantage is Real
These efficiencies create tangible benefits for residents. A comparison by the Texas Affiliation of Affordable Housing Providers found that Texas projects have:
These savings flow directly to renters, with Texas consistently offering below-average rents for zero-to-two bedroom apartments compared to the nation’s top 50 markets.
The Challenges Ahead
Despite this success story, Texas faces some significant headwinds:
Labor Market Tensions
While major metros like Dallas, Houston, and Austin have abundant construction labor, smaller Texas cities struggle with worker shortages. They simply can’t compete with the wages offered by booming metropolitan projects.
The state’s right-to-work status keeps labor costs down but also limits workers’ bargaining power for better wages and conditions.
Immigration Policy Impacts
Nearly a quarter of Texas construction workers are undocumented immigrants – approximately 337,000 people according to the Urban Institute. Immigration enforcement actions and policy changes could dramatically impact both the labor supply and the population growth driving demand.
“A lot of our growth has been from international migration,” notes Oney. “If that goes down nationally, will Texas grow slower?”
Rising Costs
Even in Texas, inflation is pushing up the cost of living, and the state isn’t immune to broader economic pressures affecting construction materials and labor.
Important Steps to Rent Your Home Out from A to Z
Step by step checklist for getting a home rented, and link to the full property management guide
1 Consider strengths and weaknesses for your home and location and consider special strategies to utilize them. Is it a college area? If so, you’ll likely handle a lot differently from low income, or a suburb
2 Get the property in show-ready condition by handling repairs, but also low-cost aesthetic fixes like spray painting rusted AC grates, and other things that really stand out. A sure way to attract sub-par tenants and repel the rest is to show a home with unrepaired issues
3 Decide whether you’re going to allow pets or not. Before you decide, know that for most landlords it’s the single best thing you can do to increase your “bottom line” profit over the long term. More on this subject here
4 Set a rental rate that will balance a minor amount of time on market hassle, with monthly rate. Whether in the form of owner-occupied showings, stress, or vacancy. Most owners fail to properly account for these subtle but real costs, especially vacancy. Vacant homes are much more costly than most account for. We can provide a free rental rate estimate compiled by people, not an algorithm, here
Looking Forward
Texas’s housing construction boom represents more than just regional success – it’s a case study in how policy choices, geography, and demographics intersect to create economic opportunity. As other states grapple with housing crises, the Texas model offers both inspiration and important lessons about the tradeoffs involved in rapid development.
Whether this pace can continue depends on maintaining the delicate balance of population growth, available labor, and regulatory efficiency that has made the Lone Star State America’s housing construction capital.
To read more on this topic, visit What’s Driving the Home-Building Boom in Texas? – Dwell/
