6 Reasons for the Texas Affordability Crisis

By Alex Buscemi, Editorial Manager at Builders

Ask a Texan what's keeping them up at night heading into November's midterms, and you probably won't hear much about the culture-war fight of the week. You'll hear about the rent, property taxes, and insurance premiums that keep climbing. Affordability has taken center stage in this year's Texas races. And for good reason: it's the thing impacting every kitchen table in the state, red and blue alike. 

Here are seven reasons the cost of living in Texas has gotten so high, several of which are unique to the way Texas is built.

1. Property taxes are brutal because there's no income tax

Texas loves to brag about having no state income tax, and it's a real perk. But the money has to come from somewhere, and a lot of it comes from your house. The median Texas homeowner pays roughly $4,108 a year, nearly $900 more than the typical American, despite Texas homes having lower median values. That means homeowners are paying more tax on less house. Local government spending has also grown fast, which pushes property taxes even higher. 

2. Homeowners insurance has become its own crisis

Even after the mortgage and the property tax, the insurance bill is waiting, and in Texas it's a monster. Premiums now average north of $4,000 a year (nearly $1,700 above the national average) and the costs keep climbing as hurricanes, hail, freezes, and floods make the state increasingly expensive to underwrite.

3. Texans keep pouring in, and housing hasn't kept up

As a legion of Fortune 500 companies and tech giants relocate here due to lower operational costs, there are few states growing like Texas. But that growth is a double-edged sword. As people and companies flood in — concentrating in the Dallas-Fort Worth, Houston, and Austin-San Antonio metros — there simply aren't enough homes to go around. Exacerbating the problem is the red tape in these cities that makes building new homes expensive. New laws have eased regulations, but supply hasn't yet caught up with demand. 

4. There aren't enough homes for middle- and lower-income families

The shortage isn't spread evenly, it bites hardest at the bottom and middle of the market. A Dallas report found the city's affordable housing supply is evaporating, with incomes failing to keep up and landlords passing higher taxes and insurance straight through to renters. So even the renters who thought they'd sidestepped the property-tax-and-insurance squeeze are paying it anyway, just folded into the monthly rent.

5. Texas runs on imported labor, and the immigration crackdown is squeezing it

Texas built its boom in no small part on immigrant workers, who make up a striking share of the workforce in construction, agriculture, and the service trades. That matters enormously for affordability, because those are the very industries that build the houses and staff the economy. Now the intensifying crackdown on illegal immigration is projected to bring major labor shortages that could slow the economy over the longer term, according to the University of Houston's regional forecast. Fewer available workers means higher labor costs and higher prices.

6. Texas is the nation's trade titan, which makes it vulnerable to trade shocks

Texas has led the country in exports for 24 straight years, shipping $450.3 billion in goods in 2025. That global reach is a tremendous strength, but it's also an exposure. The same University of Houston forecast points to tariffs as a leading force shaping the state's economy through 2026, with the major damage showing up as a shock to prices. When a state's economy is this wired into global trade, disruptions abroad, tariffs, conflicts, supply-chain snarls, don't stay abroad. They turn up in what Texans pay at the register.