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Austin's Growth Leaves Lowest-Income Households Behind
Austin leads in affordable housing construction, but the benefits aren’t reaching those who need them most.
Jordan B.
May 07, 2025
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Good morning. Austin is leading the nation in affordable housing construction, but a closer look reveals a critical shortfall. Despite record numbers, the city’s lowest-income residents are being left out.
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Market Snapshot
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market mismatch
Austin Leads in Affordable Units—but Misses the Mark
The Texas capital is topping charts for affordable housing construction, yet still falling short where need is greatest.
Affordable leader: Austin delivered 4,605 affordable units in 2024—doubling its 2023 numbers—and is set to add another 3,452 in 2025, according to Yardi Matrix. With 9,528 more units planned through 2027, Austin is outpacing larger cities like Miami and Los Angeles in the creation of rent-restricted housing.
Rapid growth meets deep need: Fueled by tech-driven expansion, Austin's population has swelled by over 170,000 since 2010, propelling it into the top ten largest U.S. cities. This surge has intensified pressure on the housing market, particularly for low-income families already struggling with affordability.
Missing the mark: Despite the surge in affordable units, the city is falling short where the need is most critical. In 2023, only 63 units were built for "deeply affordable" housing—targeting households earning about 30% of the area median income—even though this demographic makes up 17% of Austin's population.
Headwinds ahead: Public-private investments and policy reforms have powered Austin's growth, but challenges loom. Home prices have soared 58% since the mid-2010s, and rising interest rates, along with material tariffs, threaten to slow the city's momentum. Even rent-restricted units are becoming unaffordable for many, highlighting the gap between construction and true accessibility.
➥ THE TAKEAWAY
Equity gap persists: Austin is building faster than any other US city, but its success in adding affordable housing doesn’t yet translate to equity, especially for those most at risk of being left behind. Until it addresses the shortfall in deeply affordable units, its most economically vulnerable residents will remain priced out of the boom.
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✍️ Editor’s Picks
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Wealth shift: Nearly half of global family offices plan to boost CRE investment in 2025, favoring stable, income-producing assets like industrial and multifamily amid economic volatility.
High risk: As cannabis companies lean heavily on debt, Chicago Atlantic sees opportunity in a $6B loan maturity wave, betting on high-yield lending in tightly licensed markets.
Land lock: Pitkin County plans to rezone federal and state lands under a rarely used designation, aiming to block future development and preserve open space.
Cautious optimism: CRE deal activity slowed sharply in early 2025 amid ongoing uncertainty, but rising fundraises point to investor confidence in long-term market resilience.
Permit fix: Dallas launched its new online system, DallasNow, aiming to slash permitting delays that have long frustrated developers and cost the city millions.
🏘️ MULTIFAMILY
Lease leaders: RentCafe’s new Renter Engagement Tracker shows DC as the hottest rental market in Q1 and strong regional momentum from the Midwest and South.
Housing hotspots: Dallas and NY are leading the charge in multifamily investment activity, with Dallas topping the nation in unit volume and NY dominating in loan volume and new development.
Permit slump: Multifamily building permits have fallen sharply in most US cities, signaling tighter rental supply and potential rent hikes ahead.
Housing shake-up: President Trump’s latest budget proposes slashing HUD funding by 44%, reshaping Section 8 into state-run grants, and eliminating major affordable housing programs.
Vintage value: S2 Capital has acquired Amberly Place, a 770-unit, 1989-built apartment complex in Tampa, for $97 million, with plans to renovate and reposition the property through its value-add fund.
Crisis averted: Dallas-based Willowood Group avoided foreclosure on a $39.4M Fannie Mae loan for its 506-unit Oasis Apartments after striking a last-minute deal.
🏭 Industrial
Industrial alliance: BKM Capital and Kayne Anderson have launched a $1.5B joint venture to acquire value-add light industrial assets in high-growth U.S. markets
Zoning clash: Amazon is taking King George County to court after a zoning board rejected its claim to vested rights for a planned $168M data center.
Pipeline pause: Northeast industrial construction is cooling as oversupply fears and tariff uncertainty drive a 21% drop in development, with completions projected to hit multi-year lows.
🏬 RETAIL
Dining boom: Restaurants led US retail openings with nearly 3,000 new locations since 2024, outpacing grocery and discount stores as Americans continue shifting food spending toward dining out.
Soho deal: Meadow Partners is buying 200 Lafayette Street from Brookfield for $40M, a retail-office site anchored by Eataly and Moncler.
Final script: Rite Aid has filed for bankruptcy again and plans to close or sell its remaining 1,240 stores, marking a likely end for the struggling pharmacy chain.
Lease takeover: Burlington is taking over two SoCal Joann store leases, part of its plan to absorb 45 sites as Joann shuts all 800+ stores in bankruptcy.
🏢 OFFICE
Land grab: Nvidia paid $123M in cash for a 10-building Santa Clara campus across from its HQ, continuing to support surging AI growth.
Anchor down: Carnival will build a 600–700 KSF HQ near the Miami Airport by 2028, uniting 2,000+ employees and reinforcing the city's cruise hub status.
HQ move: Mudrick Capital signed a 12-year lease to relocate and double its HQ at Manhattan’s 31 W. 52nd St., signaling confidence in Midtown offices.
🏨 HOSPITALITY
Urban strength: RLJ Lodging beat Q1 expectations on urban hotel gains but cut its 2025 outlook amid economic uncertainty.
📈 CHART OF THE DAY
US apartment occupancy jumped to 95.7% in April, its highest April gain since 2010, surpassing pre-pandemic norms nationwide as operators prioritized filling units over pushing rents.
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