Red States Lure Americans With Lower Housing Costs

Texas, Florida and other conservative-led states are attracting new residents through a combination of lower taxes, warmer climates, and an anti-regulation housing strategy that many high-cost states have resisted, according to a new analysis from Fox News. As Americans continue relocating from coastal markets to the Sun Belt, the influx is testing whether fast-growing regions can add enough homes and infrastructure to keep pace.

The Red State Housing Advantage

Housing industry leaders say southern states that have prioritized new construction are better positioned to accommodate growth, while markets burdened by restrictive zoning rules, lengthy permitting processes, and other regulatory hurdles have struggled to add supply and keep home prices in check.

Jim Tobin, president and CEO of the National Association of Home Builders (NAHB), told Fox News Digital that the strategy has become a competitive advantage.

“Those economies are wide open. They are inviting more businesses, they’re generally low-tax states and they’ve made housing a priority,” Tobin said. “They’ve got the land and the will and courage to let builders build in those areas to meet the housing demand for those new jobs.”

According to the NAHB, government regulations account for roughly 24% of the cost of a typical single-family home, adding nearly $95,000 to the average price of a new house. For multifamily housing, the regulatory burden is even higher at approximately 41% of total costs.

Texas Leads the Way

Texas has become the leading example of the red state housing strategy. Over the past ten years, Texas issued 2,017,652 housing permits (1,303,555 single-family) — nearly double California’s total of 1,069,096 permits, according to data from the National Association of Realtors cited by Newsweek. In 2023 alone, Texas started approximately 217,000 total housing units, compared to 106,000 in California and just 26,000 in New York.

Lawrence Yun, chief economist at the National Association of Realtors, said the disparity is largely driven by regulatory differences. “Texas has built many more homes than California over many years,” Yun told Newsweek.

Daryl Fairweather, chief economist at Redfin, noted that “it is easier to build in Texas because of more relaxed zoning laws, less red tape, cheaper land, and cheaper construction costs. There is also strong demand for homes from out-of-state buyers.”

Texas Housing Reforms Take Effect

In September 2025, three major Texas housing reform laws went into effect, loosening zoning and land use regulations. As reported by Texas Public Radio, Senate Bill 840 allows multifamily housing by right in commercial zones; House Bill 24 reforms the “tyrant’s veto,” making it harder for nearby property owners to block zoning changes; and Senate Bill 15 permits higher-density single-family development on larger plots in major cities.

Gov. Greg Abbott hailed the reforms, saying, “This session, Texas did more than any state in America to make housing more affordable. Sweeping reforms to ensure housing is more affordable and quicker to construct in the state of Texas are now law.”

However, experts caution that deregulation alone may not be sufficient. Jacob Wegmann, a professor at the University of Texas at Austin, noted that high interest rates, expensive construction labor, and broader economic conditions remain significant barriers. “Rents are dropping in a lot of places,” Wegmann told TPR. “And tons of apartments have gotten built recently, and interest rates are high, and construction labor is still expensive.”

Ben Martin, research director at Texas Housers, added a more pointed critique: “The legislature is pretty clearly looking for solutions to the housing crisis that don’t cost any money. Unfortunately, if you want to make housing affordable, especially for the people who have the most unstable housing and are at the highest risk of falling into homelessness, it is going to cost money.”

The National Housing Crisis

The red state housing strategy is unfolding against the backdrop of a nationwide affordability crisis. The typical home sold in the U.S. is priced around $400,000 — well above what the median family can afford. Realtor.com estimates a shortfall of approximately 4 million housing units between available supply and demand.

In response, Congress passed the largest housing bill in decades on March 12, 2026. The bipartisan 21st Century ROAD to Housing Act passed the Senate 89-10 and aims to improve housing affordability through deregulation, expanding existing programs, and banning institutional investors from buying single-family homes. As NPR reported, Sen. Elizabeth Warren, D-Mass., a co-sponsor, described the bill’s broad appeal: “It’s Democrats. It’s Republicans. It’s pieces they built out together. That is the strength of this bill.”

Sen. Tim Scott, R-S.C., the bill’s other sponsor, framed the issue in personal terms: “It’s not a Republican issue or a Democrat Issue. It’s an issue about helping moms like the one who raised me, the amazing woman that she was, become homeowners.”

Population Shifts Reshape the Nation

The housing affordability gap is driving significant population shifts. The South added more people from July 2023 to July 2024 than all other regions combined, according to Census Bureau data cited by CBS News. Texas, Florida, and North Carolina are among the fastest-growing states, while California and New York have experienced net domestic out-migration.

Matthew Walsh, housing economist at Moody’s Analytics, told Newsweek that builders are following these demographic trends. “Texas was among the four fastest growing states in the nation last year, while California and New York lost residents. Builders are sensitive to these local demographic trends when making investment decisions.”

Challenges Ahead

Despite the success of the red state model, rapid growth brings its own challenges. Tobin acknowledged that infrastructure often struggles to keep pace with new development. “One of the main complaints is that infrastructure does not keep up with that influx of population or housing growth,” he said. “States that find themselves ahead of the curve are planning those two critical components, infrastructure and housing, together and are going to be better prepared for growth in the future.”

Meanwhile, the bipartisan housing bill faces an uncertain path to becoming law. President Trump has said he will not sign any legislation until Congress passes the SAVE America Act, which would require voters to provide proof of citizenship. However, a bill passed by both chambers can still become law if the president takes no action and 10 days pass with Congress in session.

What to Watch For

As the midterm elections approach, housing affordability remains a top concern for voters. The ability of red states to attract residents through lower housing costs is reshaping the political map, with population shifts translating into electoral college changes and congressional reapportionment. Whether blue states will respond with their own reforms — and whether deregulation alone can solve the nation’s housing crisis — are questions that will define the debate in the months ahead.

The answer, according to Tobin, is straightforward: “The answer to the housing crisis in the country is more supply. This bill will absolutely help us build more supply affordably.”