Escalating home insurance costs are severely straining housing affordability nationwide, and especially in Texas, where climate-related disaster risks are higher. Analysis of Texas Department of Insurance county-level data from 2000 to 2024 reveals these rising premiums disproportionately burden low- and moderate-income families, eroding both homeownership stability and insurance take-up rates.
Key findings
- Homeowners insurance premiums in Texas continue to outpace general inflation, consuming a growing share of median household income (reaching 4.65% in 2024).
- About 64% of Texas households (7.04 million) in 2024 could not afford a median-valued home in their county without becoming housing-cost-burdened (spending more than 30% of their income on housing). A 10% increase in homeowners insurance premiums would price out an additional 49,896 households.
- Wealthier households earning more than 120% of the median household income are largely insulated, while lower- and moderate-income households face statistically significant drops in homeownership as premiums rise.
- Accelerating insurance costs correspond with a decline in overall insurance take-up rates.
The analysis suggests that without intervention to stabilize costs, insurance hikes threaten to dismantle homeownership as a tool for long-term wealth building for Texas's more vulnerable populations.
