3 reasons why this is not enough
Yes In My Back Yard?
After decades of trying to implement a comprehensive revision to the City of Austin's development guidelines, the best we get are a few tacked on policies at City Council meetings. First they enabled Accessory Dwelling Units, and now they have reduced the minimum Austin lot size to 2500 square feet, ostensibly to increase density and allow for smaller and theoretically more affordable homes in the city core. Now I applaud the effort however incremental and incomplete, it is at least a step in what I believe is the right direction. The interesting part of this council meeting were the proponents and detractors that showed up and how their demographics reflected in their opinions. Older residents largely did not want any density increase because they don't want anything to change. Younger residents all wanted more density so they could actually afford to live near down town. When you're looking to the future, it seems that the young should carry more of a voice and that ruled the day here. Personally I want cheaper housing and I believe the way to do that is enable as much supply as possible, so I am for this change and I would like to see even more measures take to allow Austin to grow into the metropolis it needs to become to house a dynamic population with a full spectrum of wealth ranges instead of the highly bifurcated very rich and very poor. Let's not become a San Francisco of Texas at least when it comes to housing.
So what is it going to do?
Sadly, not as much as we need. The smaller lot size means we can get more units per acre which is a good thing. The ruling also allows three homes per lot instead of two which is also good at increasing density. Ultimately it means more smaller homes which should be less expensive due to their size and split land costs across doors. However there are still several limitations that limit what could be done. First, the subdivision process is still unworkable. It takes at least one year to complete a subdivide if everything goes right. The cost for subdividing is still very high, nearly $35,000. Due to this long timeline and high expense, most developers building small homes or row houses will simply elect to make more small condo associations since you can get one of those done in as long as it takes a good attorney, about a week or two. Those docs cost about $3,000, less than a tenth of the cost of a subdivision. So the smaller lot size is almost dead on arrival simply out of cost. Second, trees still matter more than people. I can appreciate keeping trees to keep the green spaces in our city. Just keep the ones in the setbacks. Right now though, if there is a protected tree in your back yard, the city won't allow you to develop it. No density increase is possible when you have a tree. Third, the impervious cover requirements are still the same. On a 7500 square foot lot, you can still only build 3,375 square feet of impervious cover which translates into roughly three 1,000 square foot units.
Long term impact of smaller Austin Lot Size
Just like the ADU law which was a band aid, this is too. We will start to see more triplexes and three unit builds on these in-fill lots, but only if they can make the same money as a large 3000 square foot luxury homes. As long as those buyers are there, many developers may just stick to large luxury homes. We shall see how that demand holds up. The dark side to this law is that it causes a lot of new building under the new rules which locks in a certain density for at least 30 years. When someone builds a new ADU or triplex, or A/B unit, that new construction is too valuable to tear down in the case of up-zoning. So when the city finally buckles under the pressure and starts to increase density in areas to allow more people and lower prices, areas like South and East Austin will have to wait 30 years for these new homes to degrade to a point where it makes sense to tear them down to build higher density real estate. This ends up locking in the density we have for at least 30 years when we add these stop gap solutions.
Instead of just pointing out what is wrong, I will offer my own proposal for a solution. It would not be popular and could probably never pass the political test, but it just might work. Simply up-zone for growth and invest in infrastructure like roads, water, and sewer. If a property with a single family home on it gets up-zoned to multi-family, it doesn't force anyone to move. It just makes it ready to go high density once a developer can buy up all the lots in order to go higher density. Only after respecting your property rights as an owner and all parties sell to a developer could a new high density building be put in place. These all require lots of water and sewer. The existing infrastructure in these sub-urban neighborhoods near downtown won't cut it. Upgrading that ahead of time prepares the city for growth when it comes. This doesn't force anyone out, but everyone gets to choose when they sell and we attempt to future proof the growth of Austin. If we keep Austin the way it is because we don't want it to change, it will follow the fate of San Francisco and make it only possible to live in the city if you are a high earner.
As always, question everything and don't take suggestions as absolutes. These are written from a perspective of our experience and offering our insight, however limited. We're not perfect and get things wrong... but not on purpose.