Texas and Florida have long boasted the number of immigrants they receive from expensive states like New York and California. But that migration may begin to slow as housing costs rise in the former pair of states. Florida has implemented some significant reforms in response. Will denim follow?

Recently paper Lee Ohanian and Joseph Vranich of the Hoover Institution conclude that housing costs are a key driver of business departures from California. “Seat Migrations from Santa Clara, Alameda and San Mateo Counties [are] not only to control business costs but also to employ workers with the benefits of lower housing costs,” they write.

But rising housing costs in Florida and Texas pose a risk to their impressive growth. “If you buy a house in Miami today versus just three years ago,” Peter Thiel told Barry Weiss at recent interview“you’re paying four times more in monthly mortgage payments,” due to a combination of higher housing prices and higher interest rates.

Like my colleague Roger Valdez regularly expires, outdated housing regulations limit the growth of housing supply, which leads to higher prices. “Texas has a little bit of everything,” Valdez it says“even the kind of thinking that too often prevails in political debates about rising housing prices”—i.e. restricting supply and hoping that subsidies for the poor will make up the difference.

Austin, Texas, most likely did tried to update its land use code to expand housing supply, just to be paralyzed multiple lawsuits from groups favoring the status quo.

In response, Texas Governor Greg Abbott stood up state-based reform it would prevent these local vetoes. “As opposed to the state having to take multiple approaches to gun shooting to override local ordinances, I think the broad Texas state law that says the state will preempt local ordinances is a superior approach,” Abbott says.

Two land-use bills being considered by the Texas Legislature stand out: one on “third-party review” (House bill 14) and one according to lot size requirements (Senate Act of 1787).

The third-party review, a priority of Texas House Speaker Dade Phelan (R.), would streamline the homebuilding process by allowing experts like architects or engineers to sign off on reviews of site plans, among other aspects of the permitting process, a law signed into law by Gov. Ron DeSantis (R.) in Florida. Site plan review takes the most time in the permitting process, adding up to 5% on the final price houses for every 3.5 months of delay. Addressing this bureaucratic bottleneck can act as a relief valve for cities struggling with heavy traffic.

Another piece of legislation, lot size reform, would transform the cost of buying a home by restoring the property rights of owners to the median lot size of 1,400 square feet. Less restrictive lot sizes are a vital component of any effort to make housing more accessible and affordable for Texas’ middle class. In the south, 40% of housing costs are land. Mathematically speaking, if cities in Texas can reduce the amount of land available to build a home, they can reduce overall costs. The City of Austin requires 5,750 square meterswhile Dallas requires a minimum 5,000 square meters. So it’s no surprise that Austinites spend 48 percent annual household income on housing costs, while Dallasites spend 42 percent their annual housing income.

A 2019 paper by Brian Asquith, Evan Mast, and Davin Reed for Upjohn Institute estimates that the new buildings lead to an immediate reduction in rents in the area by 5 to 7 percent. Sounds good, right? Well yes, unless you are one of the neighboring landlords who benefit from the higher rates.

These landlords and their allies claim to support the “community” over “developers,” but the result of their favored policies is the exclusion of lower- and middle-income Americans from their communities.

This problem isn’t new—across America, NIMBYs are fighting back against “yes-in-my-backyard” housing activists who seek to remove regulatory restrictions on housing. But it’s especially striking in Texas, a state that claims to stand strong for free enterprise but often falls short when it comes to special interests. The Texas Legislature should take the opportunity before them to do something constructive.