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Fast facts on the new code and

Affordability

Austin has a lot of attractive qualities: A good economy, in the most beautiful part of the state, filled with exciting opportunities. We're home to a world-class university and a young and educated citizenry. It’s the kind of city people talk about overseas. We wouldn’t want to change any of that.


But these great qualities also drive demand. So if we want Austin to remain something else than an enclave for the very wealthy, we need to increase our supply. An updated code will allow the city to direct growth where it is most needed, adding to our housing inventory so that everyone has a place to live that they can afford. 


FACT: There will likely be fewer tear-downs of existing homes in neighborhoods under the draft code. A newly proposed preservation incentive will protect neighborhood character by encouraging owners to preserve existing homes, rather than tearing them down. This incentive allows a homeowner to build one additional home or granny flat on their property than they otherwise would be allowed to build under the code, only if they preserve the existing home on the property. Many community members and Council Members have expressed concern about demolitions of existing homes, and this preservation incentive will address those concerns. If an additional home is built due to the preservation incentive, other requirements of the zoning code, like height, setbacks, and tree preservation will still be applicable.


FACT: Under the new code, a homeowner outside a transition area would still be allowed to add a garage apartment. To incentivize the preservation of existing homes, a third unit could potentially be built only if there are steps taken to not demolish the existing single family home on that property. The ability to add a third unit is only granted if the original house is preserved. Under the current code, there are far too many demolitions of older homes, and the new code will help to fix this. 


FACT: Texas state law makes it illegal to raise property taxes on a property based on zoning, if there's a homestead exemption. Property taxes are based on how the land is actually being used, not how it is zoned. So if you own a single-family home and you don't tear it down or otherwise change the land's use, you won't see any property tax increase due to how your land is zoned. 


If you think in terms of "comps," you can understand it this way: a single-family home can only be compared against other single-family homes for their taxable values. And that's straight from Section 23.01(d) of the Texas Property Tax Code: 


"The market value of a residence homestead shall be determined solely on the basis of the property's value as a residence homestead, regardless of whether the residential use of the property by the owner is considered to be the highest and best use of the property."


FACT: The new draft code will require participation in Austin's affordable housing program in order to achieve the maximum number of homes allowed on a lot in a transition zone. The proposed R4 zone will allow 4 homes by-right (before accounting for reductions for tree protection, environmentally sensitive areas, smaller lot sizes, etc which frequently reduce the number of homes that can be built on a lot), and up to 8 homes will only be allowed if the property owner participates in Austin’s affordable housing program, which requires either affordable homes built on site or paying the cost of providing affordable homes offsite. 


The other zone in transition areas, RM1, only allows 6 homes to be built by right (again, before accounting for reductions for tree protection, environmentally sensitive areas, smaller lot sizes, etc which frequently reduce the number of homes that can be built on a lot), but will also allow a bonus of up to four additional homes if the owner participates in the affordable housing program. These additional “bonus” homes will help pay for new subsidized homes for low and moderate income Austinites.  


In addition, as stated previously, the transition areas that contain R4 and RM1 zones are proposed for only about 2% of the land in the city. 


In Texas, policy tools like requiring developers to provide affordable housing (called “inclusionary zoning”) onsite or obligating them to pay fees to build more affordable housing are illegal under state law, so Austin is limited to providing affordable housing through incentives.  If we want to maximize the amount of income restricted affordable units, we have to maximize the use of these incentives. 


FACT: The goal of the new code is to allow for more affordable housing, in turn allowing more people to live in opportunity-rich areas near good schools, jobs, and transportation choices. Because land values are so high in many of those areas, to make this work, the housing needs to be smaller and make more efficient  use of the expensive land. That means more homes on the same or smaller pieces of land.  


While there is affordable housing in Austin today,  unfortunately it's located in places without access to good schools, jobs, and transportation choices. As a city, we absolutely should be doing all we can to bring  good things to those places, and in the meantime, we also need to allow for more people to live where those good things already are.  


FACT: Tens of thousands of neighbors worked for years to create a shared vision for how our city should steer growth called Imagine Austin. The new land development code provides the tools to actually realize that vision.