HOUSING | Texas’s Housing Shortage
Why businesses should be concerned about an ever-shrinking supply of shelter.
Written By Magatte Wade
Texas’s business boom continues to draw eyes across the country: From Samsung’s $17-billion manufacturing facility to the new Goldman Sachs office that plans on hiring 4,000 employees in Dallas, the key component in this attractiveness is the ample availability of reasonably priced housing for employees. However, year after year, our housing market experiences a dangerously large shortage in supply, leading to skyrocketing prices and fewer and fewer options for employees seeking a place to live.
With about 1,000 people moving to Texas each day, a new job for a new Texas resident cannot mean one less house for a lifelong Texan driven out of the market.
As a small business owner myself, I’ve seen how the housing shortage continues to be a major hurdle for those looking to prosper in Texas. Rising housing prices have made it difficult for businesses to attract and retain employees, with their employees struggling to afford housing. When employees are unable to find reasonably priced housing, they eventually move away, leading to high turnover rates for Texas businesses. Some are driven out of business entirely, like Baby Greens.
Due to sky-high housing prices, Baby Greens’s Founder Sharon Mayes, a beloved Austin-based healthy fast food restaurant owner, shut her doors because their employees could not afford to live in the area. Before closing, Baby Greens even tried to hire new employees by offering a starting wage of $17 an hour, $5 higher than the industry average in Austin. With rent in the city sitting at a whopping median of $2,930, Baby Greens could not find new employees willing to stomach the outrageous cost of living. With housing and rental prices now increasing in San Antonio, too, I have no doubt restaurants and other small business owners are facing the same problems.
While Austin is the fifth most expensive city in the country, Texas’s other cities struggle with housing supply problems as well. The median renter in San Antonio, Fort Worth, and Dallas makes far below what is required to afford a starter home. For Texas to continue to be a desirable location for businesses to operate and expand, it is imperative that we increase our supply of free-market workforce housing for the middle-class Texans who are the foundation of our communities, as well as our state’s flourishing economy. With about 1,000 people moving to Texas each day, a new job for a new Texas resident cannot mean one less house for a lifelong Texan driven out of the market.
There are a few meaningful ways in which we can solve Texas’s housing crisis. One option is to encourage the development of units that are within reach of people, like entry-level professionals, firefighters, and teachers, such as townhomes and garage flats. These types of homes can be more affordable than standard single-family units while also offering the added benefit of being far more energy-conscious due to their smaller size, low use of resources, and proximity to where employees work and play.
Another way to increase the housing supply is to ease onerous obstacles deterring builders from constructing new homes. Streamlining the permitting process and reducing regulatory barriers, which can be time-consuming and costly for builders, have proven successful tactics before.
One study found that 45 percent of housing construction did not even get off of the ground in over-regulated markets. By making it easier for builders to get started on new projects, we can increase the number of homes being built, add to the overall housing supply, and decrease housing prices, benefiting our workforce and, in turn, our businesses.
Increasing the housing supply in Texas is key for the state to continue to add jobs, innovate, and thrive economically. By providing more housing options, we can make sure our Texas businesses and residents can flourish. By encouraging the development of housing that is accessible to our workers and streamlining the permitting process, we can make a meaningful impact on the state’s housing market and sustain our impressive economic growth. Reasonably priced housing will be felt by everyone in our community, both employers and employees alike.
Magatte Wade is a serial entrepreneur, inspirational speaker, visionary business leader, and advocate for African dignity and prosperity. Her TED talk, "Why it is too hard to start a business in Africa—and how to change it," has been seen by more than 600,000 people. She has written for The Guardian, HuffPost, and Barron’s and spoken at numerous high-profile venues, including the UN, the Clinton Global Initiative, the Aspen Institute, and dozens of universities. Follow her at and @magattew