Austin boasts 9th highest rate of new home construction in U.S.

Austin is trying to accommodate its housing demand by building more homes than most other U.S. cities, a new report has found.

According to a new ConsumerAffairs housing report, Austin has the ninth highest rate of new home construction in the nation for 2025. The research platform analyzed new building permits and new construction home sales from January and February 2025 in the 150 largest U.S. cities.

Houston (No. 1) and Dallas (No. 2) led the nation as the top two cities building the most new homes this year.

The findings revealed there were 3,889 new building permits issued during the first two months of the year in Austin, and 520 newly built homes were sold during that same period.

The city is keeping pace with consumer trends: According to recent study by the National Association of Home Builders, more than three in five homebuyers would prefer to purchase a new-construction home over an existing one, the ConsumerAffairs report says.

The high rate of home construction is also affecting Austin’s rental market. A separate ConsumerAffairs study found Austin was just one of two U.S. cities (out of the 70 most populous) where rent prices dropped from 2023 to 2024. Median rent prices fell 3.5 percent to $1,719 in 2024.

The rise of artificial intelligence is also playing a key role in fast-tracking development opportunities in the city, the report added.

“After a 2022 audit found that it took an average of 345 days — more than 11 months — to review a building application, the city began a pilot program using AI to review building plans and flag them for inconsistencies between construction applications and Austin’s building rules,” the report’s author wrote.

Austin may be one of the original pioneers to implement the technology, and it appears other major cities are following in the Texas Capital’s footsteps. After several wildfires devastated Southern California in January 2025, the city and county of Los Angeles launched a new program using AI to help rebuild housing in the metro area.

Elsewhere in Texas
Houston is dominating other housing markets with the highest growth rate in new building permits, totaling more than 11,000 permits between the first two months of the year. The city also leads with the highest rate of new construction homes sold during the same time period, with more than 1,300 sales.

ConsumerAffairs says Houston is the only major U.S. metro that doesn’t implement zoning laws, meaning housing density is not regulated and communities don’t need to be separated by “use type.” Many rules that are in place are in favor of dense housing development.

“The absence of these laws has contributed to Houston’s infamous sprawl, but it’s a boon for developers and homebuilders, who have far fewer restrictions to navigate when constructing new homes,” the report said. “After 1998 reforms to the city’s development ordinance lowered the minimum lot size for single-family homes from 5,000 to 1,400 square feet, more than 25,000 new homes were developed on these new, smaller lots between 1999 and 2016.”

The top 10 cities with the highest rates of new home construction in the U.S. are:

• No. 1 – Houston, Texas
• No. 2 – Dallas, Texas
• No. 3 – Phoenix, Arizona
• No. 4 – Atlanta, Georgia
• No. 5 – New York, New York
• No. 6 – Charlotte, North Carolina
• No. 7 – Orlando, Florida
• No. 8 – San Antonio, Texas
• No. 9 – Austin, Texas
• No. 10 – Tampa, Florida