Starter Homes Live in Texas, Die in Arizona
Happy Tuesday, and welcome to another edition of Rent Free. This week’s stories include:
- A win for starter homes in Texas…
- …and a defeat for them in Arizona
- A new constitutional challenge to affordable housing fees in Denver
- A veto of a rent-recommendation algorithm ban in Colorado
Starter Homes Are Resurrected in Texas…
After suffering a near-death experience last week, Texas’ Senate Bill 15, a.k.a. the Texas Starter Homes Act, has passed the Legislature and now goes to Gov. Greg Abbott’s desk.
The bill would prevent larger cities in larger counties from requiring that homes sit on lots larger than 3,000 square feet in new subdivisions of at least five acres.
Proponents argue the bill will enable the construction of more inherently affordable owner-occupied housing in cities that currently require much larger minimum lot sizes.
“Texas is the first state to take seriously the idea that a basic starter home, without any subsidy, is usually affordable to people making average or below average incomes, [and] should be available throughout the state,” says Salim Furth, a researcher at George Mason University’s Mercatus Center.
Minimum lot size bills have been one of the more controversial and less successful YIMBY reforms in state legislatures. Texas’ bill is one of the first to make it over the finish line.
The initial version of S.B. 15 would have capped minimum lot sizes at 1,400 square feet, which mirrors unzoned Houston’s minimum lot sizes.
That version passed the Senate back in March but was watered down in negotiations between the House and Senate during last-minute considerations of the bill.
The legislation survived an effort by Texas House Democrats to effectively gut the legislation.
Rep. Ramon Romero Jr. (D–Fort Worth) briefly succeeded in amending the bill to only require that cities create a starter home zoning district with the smaller minimum lot sizes. The amendment would not have required cities to actually apply this new zoning district to existing land or to new subdivisions.
This would have effectively made S.B. 15 a voluntary paperwork exercise.
Romero, who also briefly managed to kill S.B. 15 via a procedural move in the House earlier in May, has criticized the idea that allowing smaller homes on smaller lots would yield more affordable homes.
“It’s already been proven that just because you have smaller (homes) does not immediately equate to more affordable (homes),” he said to The Texas Tribune last month.
(One study of minimum lot size reductions in Houston, Texas, facilitated an “unprecedented” increase in the rates of infill housing construction in single-family neighborhoods.)
That gutting amendment was stripped out of the bill in last-minute negotiations between the House and the Senate, meaning that S.B. 15 will have some teeth, provided that Abbott signs it into law.
While the bill does not apply to existing residential areas, Furth says it will provide developers a lot more flexibility when constructing new subdivisions, where most new housing in Texas is being built.
“Most single-family home production in Texas is done in non-residential or extremely large lots. A normal Texas subdivision is going to be five-plus acres, and maybe 100 acres,” he tells Reason. “This will allow [builders] to include small homes in that mix and make sure there’s a variety of price points and variety of styles.”
…and Killed in Arizona
Meanwhile, in Arizona, a near-identical Starter Home Act is effectively dead in the Legislature.
Similar to Texas’ S.B. 15, Arizona’s S.B. 1229 initially would have prevented cities from requiring homes in new five-acre-plus subdivisions to sit on lots of 1,500 square feet or more. It also would have prohibited cities from dictating home designs and aesthetic features.
As in Texas, the bill was amended to raise its minimum lot size cap to 3,000 square feet. That helped get the legislation out of the Senate on a 16–13 vote, with Republicans and Democrats on each side of the vote.
Two House committees also approved the bill in March a
Article from Reason.com
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