What Every Property Owner in Texas Needs to Know Now (Part 2)
By Leigh Budlong
This is the second in a series of articles exploring major changes to Texas zoning laws that went into effect September 1, 2025.
In a previous Building Savvy article, I wrote about the new Texas zoning bills to introduce the scope of widespread changes. They are vast and being interpreted differently by city. Cities that must comply with the new State Zoning that is tied to population (namely SB840, SB2477 and SB15) currently include Arlington, Austin. Brownsville. Corpus Christi, Dallas. Denton. El Paso. Fort Worth. Frisco. Garland. Grand Prairie. Houston. Irving. Killeen. Lubbock. McAllen, McKinney, Mesquite, Pasadena, Plano and San Antonio. And a few more are close to the 150,000 population requirement (within a county with 300,000 people).
Interestingly. SB840 and SB2477 do not list a source for making that call. From the “estimates” in population, the new zoning bills seem to cast their requirements to over 10 million people.
Interpretations Matter
If you’re reading this and thinking “it doesn’t impact me” please remember, as I wrote in Part 1, this is the initial test with plans to expand to smaller cities. From my reading and analysis of the bills as well as viewing city documents and meetings on the bills, this is without question the largest change in property rights in Texas history.
In a city already on the SB840 list, I expect to hear about growing pressures of uncertainty given a) a city’s interpretation of where SB840 applies and b) if there are just “too many” options that now pose another challenge of building with confidence. Greater confidence would require locating SB840 candidates near those locations that are exempt from SB840 namely: HOAs and Historic status locations (landmarks and historic districts). The other exempt areas do not sound appealing for housing, i.e. near heavy manufacturing, military bases, police training and airports.
The main issue in how a city interprets SB840 seems to be Section 218.102 (Regulation of Mixed Use Residential and Multifamily Development). Why? Because it reads as follows: “Notwithstanding any other law, a municipality may not adopt or enforce an ordinance, zoning restriction or other regulation that imposes on a mixed-use residential or multifamily residential development.” Then it goes on to list the development standard requirements such as “a limit on density more restrictive than…”
The law was not written to cite a previous section in the document and that is why cities like Dallas are interpreting it to mean “citywide.” Cities like Austin, however, are only interpreting it to relate to locations cited in the earlier part of the document.
When you consider the difference, it is clear. This is a big deal both for existing property owners and developers. Where’s my moat? Where does this end?
Reality Sinks In
City Council Member William Roth of Dallas has indicated the city should pursue litigation to restore their rights under “home rule.” This would likely mean challenging the bill behind the ushering in of HB2127, also known as “Death Star” bill.
While cities scramble to update their codes, there is also the need to update their process to move permits through. The City of Austin announced its Expedited Site Plan Review Pilot Program on October 1. The pilot’s objective is focused on permitting time to six months, down from 12–14 months. Their process uses AI for processing permits relative to SB840 and SB2477.
Some cities are also adding their own twists. For instance, Plano has a requirement to post notice in front of projects built under .SB840 and SB2477 to make it clear it is State of Texas making this project possible.
How This All Came To Be
I’ve been asked about the “backstory” and through some digging I”m finding ways to connect a few more dots.
My perspective is that a property owner in a city with zoning regulations buys knowing its status. I realize not everyone actually does the homework. But the zoning was known to the lender, for instance, and maybe the Realtor. While this is not viewed as a “contract,” there is a level of obligation that was met. But now the rules have changed. The number one concern is erosion of quality of life which affects financial well-being. Will property values be negatively impacted?
If it can happen to a homeowner, who’s to say it can’t happen to a developer? What if there is excess building for instance? What if the State creates another set of rules about rent control? Will the new rules consolidate development to the largest of large companies?
It doesn’t seem that long ago that the news was buzzing about the “missing middle” of the housing market. It was all about 3 to 8-unit buildings that could be fulfilled by smaller scale developers. However, that didn’t seem to do the trick. Or maybe the objectives changed.
What I can relay is the Texas Comptroller’s office issued a report citing 320,000 needed housing units in time for the 89th State of Texas Legislative session. Lobbyists were available with the reports and stories to support the need to add new laws. The report used to fuel State of Texas Legislators is Home Policy and it was produced by Up for Growth, which is a lobbying group in effect.
Up for Growth is not a grassroots organization.
It has the real estate industry’s biggest institutional players involved: John Prete, CCO Asset Management Americas Blackstone Real Estate (the largest owner of units in the country); and Chuck Leitner, who ran CBRE Global Investors as its Global Chief Executive Officer.
They Started Early and Got Connected at the Federal Level
A press release about Up for Growth’s aim to solve the housing crisis was issued in 2020. That was 5 years ago. The following is an excerpt:
Up for Growth Action supports policies focused on tearing down systemic barriers to housing development, such as exclusionary zoning, and increasing access to capital for affordable housing development. Advancing solutions that address these challenges creates what Up for Growth Action terms “accessible growth” – prioritizing housing production in areas of high economic opportunity, areas that leverage investments in transportation and infrastructure, and in areas where jobs already exist.
The Group “Yes In My Back Yard” Has a Seat on the Board As Well, and a Tie-In to US Congress
I learned “Yes In My Back Yard” is a 501(c)(3) nonprofit, while its partner organization, YIMBY Action, is a 501(c)(4). Per Google AI, the two organizations operate in tandem to promote housing supply and affordability.
Neighborhood groups in states outside of Texas are banning together to figure out how to stop a new comprehensive plan from happening in their states. What they tell me is that the meetings are attended by Yes In My Backyard supporters. In an age where we are now learning that protesters may be paid, it begs the question: What is their validity in a land use decisions being made by elected officials who took an oath to serve the People?
Here’s more from the 202 press release:
Though a relatively new organization, Up for Growth Action already boasts progress in enacting its legislative agenda. Earlier in 2020, the Yes In My Backyard (YIMBY) Act passed the U.S. House without opposition. The Neighborhood Homes Investment Act, the Build More Housing Near Transit Act, and the Affordable Housing Credit Improvement Act – all endorsed and advanced by Up for Growth Action – were included in the House-passed Moving Forward Act. Though primarily focused on federal policy, earlier this year in California, Up for Growth Action led the effort to pass AB 2345, which expands the state’s density bonus law and is projected to add nearly 200,000 new homes to the state over the next five years, many of which will be affordable.
“Of the many national organizations, Up for Growth Action is well positioned to help lead the charge as communities around America seek to reimagine their entire landscape,” said Roderick Hall. “And given that housing is a civil rights issue, the work by Up for Growth Action to advance pro-housing policy matters now more than ever. We must ensure that all Americans have access to opportunity, especially our BIPOC and low-income communities.”
The incoming Biden-Harris Administration has already outlined a comprehensive housing plan well-aligned with Up for Growth Action, including a focus on reducing exclusionary zoning to increase housing stock, direct investment in housing, and recognizing the relationship between where people live and their overall wellbeing.
“We laid the groundwork for pro-housing policy through our work in the 116th Congress,” continued Kingsella. “In the 117th Congress, we will push these policies across the finish line.”
The Texas Zoning Bills are the Breadcrumbs Set Up by Massively Well-Connected and Funded Entities
What has happened in Texas is now going on in other states like Arizona, California and elsewhere. While SB840 and SB2477 do not mandate an affordable housing program, I think this will develop over time.
In conclusion, what is just starting to sink in for Texas is now a hot topic in California with SB79, a similar concept to allow by-right multifamily which was signed into law on October 10, 2025. Funding and connections help create the ability to “blueprint” similar bills across the U.S. And this will mean a major change in investment strategy. It will impact how most people feel about buying a home.
Although a home may not be the largest investment for some, it is for many. It is used to provide shelter, place of identify and security as well as to fund dreams and pursuits. The notion of apartment living or residential condominiums is very different.
In my next article I’ll be writing about 15-minute cities and how this concept is part of a transfer of property rights in Texas.
Up for Growth Action’s Directors in 2020 Who Got the Ball Rolling:
Dr. Akilah Watkins-Butler. President and CEO, Center for Community Progress, Flint, MI
Cynthia Parker, Chairwoman of the Board and Member of the Executive Committee. President and CEO of BRIDGE Housing Corporation, San Francisco, CA
Neala Martin, Secretary and Treasurer and Member of the Executive Committee. Senior Vice President, Acquisitions, CREA, LLC, New York, NY
Doug Bibby, Member of the Executive Committee. President, National Multifamily Housing Council, Washington, DC
Ken Gear, Member of the Executive Committee. CEO, Leading Builders of America, Washington, DC
Chuck Leitner, Member of the Executive Committee. CEO, CBRE Global Investors, New York, NY
Kevin Dinnie. Chief Operating Officer, Trammell Crow Residential, Dallas, TX
Adrienne Bush. Executive Director, Homeless and Housing Coalition of Kentucky, Frankfort, KY
Roderick Hall. Director of Organizing, Abundant Housing LA, Los Angeles, CA
Antonio Marquez. Managing Partner, Comunidad Partners, San Diego, CA
Kris Siglin. Vice President for Policy and Partnerships, National Community Stabilization Trust, Washington, DC
Bob Simpson. Founder, Simpson Impact Strategies, Sioux Falls, SD
About the Author: Leigh Budlong took her experience in commercial real estate to solve a knowledge gap, founding Zoneability in 2014–a product line owned and operated by Beyond Value, Inc., a Texas company. Zonability Reports uses patented software to reduce complex city zoning ordinances, comprehensive plans and mind-numbing documents into a simplified analysis that identifies hidden insights and opportunities. Zonability clients are primarily title companies seeking to engage in the success of real estate agents and brokers, developers and investors.
Visit www.txzoning.com to gain an edge on State Zoning.
THIS ARTICLE ORIGINALLY APPEARED IN VOL 5 2025
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