April 23, 2024 | Driving It Home with ABoR's Housing Economist

On this episode of Driving It Home Dr. Clare Losey and ABoR Deputy Director of Communications Danielle Hammett discuss the recent economic research on the impact of minimum lot size on housing affordability and the total cost of home ownership. The discussion revolves around a proposed change in Austin's minimum lot size from 5,750 square feet to 2,500 square feet. Dr. Losey explains that reducing the minimum lot size could lead to more affordable housing because it allows more homes to be built on subdivided lots, potentially reducing the cost of home ownership by decreasing the size of the land required.   Dr. Losey points out that holding other factors constant, reducing the minimum lot size can lead to lower home prices and increased housing supply. Specifically, if the lot size is reduced to 2,500 square feet, it could cause a 10% to 25% decline in the price of a new home. The research suggests that subdividing larger lots could generate up to 436 additional homes annually in Austin, significantly impacting the city's housing supply. While this might not be immediately apparent, the long-term effects are crucial, as it can take years for the changes to materialize due to permitting processes and construction timelines.   The episode concludes with a discussion about how this research might affect real estate businesses and potential home buyers. The hosts emphasize the importance of addressing affordability, especially in a rapidly growing city like Austin. They encourage listeners to share the research with their clients, suggesting that these changes could have significant implications for housing affordability and accessibility in the city.   New Research Report: The Impact of Minimum Lot Sizes on Housing Affordability https://www.abor.com/research Apple: https://podcasts.apple.com/us/podcast/driving-it-home-with-abors-housing-economist/id1714289732  YouTube: https://www.youtube.com/playlist?list=PLzH_caxJ3VPq5iExWilqZOahnREgSFgqC   Download the Audio Transcript + Episode Summary: https://www.abor.com/content/uploads/2024/03/DIH-3-26-24.pdf Connect with us on socials: https://www.abor.com/socials  Connect with Dr. Clare Losey on LinkedIn: https://www.linkedin.com/in/clare-losey   Have feedback? Email us at [email protected].