DALLAS — It’s getting tougher for lower-income families to afford to live in the state’s third-largest city.

The supply of homes affordable for less affluent families in Dallas has evaporated in recent years as the Dallas-Fort Worth region has boomed, a report released this month by the nonprofit Child Poverty Action Lab shows. Single parents, older adults and renters of color in particular have felt the pinch from higher rents — even as those rents have cooled.

“It’s hard to be a renter in Dallas,” said Ashley Flores, the Dallas-based organization’s housing chief who co-authored the report. “We have a serious shortage of affordable rental units for very low-income households.”

It’s a microcosm of the broader housing affordability problems facing Texas. Though the state builds more homes than any other state, it hasn’t built enough to meet demand — driving home prices and rents upward as the state has grown. Incomes have increased, but not enough to keep up with housing costs. Meanwhile, landlords have faced higher costs in the form of insurance and property taxes, which they appear to have passed along to renters. As a result, the cost of owning or renting a home has put more financial strain on families, taking a bigger bite out of household budgets. Low-income households in particular have a harder time finding housing they can afford.

Those factors are on full display in Dallas, the epicenter of the state’s largest urban area. The city, the report found, faces a deep shortage of rental homes affordable to families making 50% of the area median income, $52,000 for a family of four, or less — and that shortage has grown at a blistering clip. The city was short roughly 46,000 rental homes for families at or below that income level as of 2023, according to Child Poverty Action Lab’s latest analysis of Census Bureau data. Two years prior, that shortage stood at 33,660.

Now, for every 100 households at that income level, Dallas has just 60 homes they can afford to rent.

Incomes have grown, but haven’t kept up with housing costs. Half of the city’s renters were considered “cost-burdened” in 2023, meaning they spend more than 30% of their income on keeping a roof over their heads. That threshold means a family may not have as much money left over to tackle other household costs like health care, child care, groceries and transportation.

That pressure is most pronounced among the city’s families who rent. Some three-quarters of Dallas single renters with children are considered cost-burdened, the CPAL report found. Nearly three-fifths of all Dallas renters with children are cost-burdened.

Other renters felt the pressure, too. Nearly two-thirds of older Dallasites who rent were cost-burdened, the report found. So were 60% of Black renters and 51% of Latino renters.

Households among the poorest of the poor, those making 30% of the area median income or less, spend more than three-quarters of their take-home pay on keeping a roof over their head, the report says.

Cheap rent is increasingly hard to come by. The city’s supply of low-rent units that go for less than $1,000 a month has evaporated. From 2021 to 2023, Dallas lost 51,000 of those homes, roughly half of the city’s overall stock. That supply has shrunk as landlords pass on costs like rising insurance bills and property taxes, or the market simply allows them to charge more. Other homes might have been renovated or demolished, Flores said.

The rate at which Dallas has lost its cheap housing supply “was staggering to us,” Flores said. “I think my jaw hit the ground on that one.”

The majority of the city’s “naturally occurring affordable housing” — low-rent homes that aren’t subsidized in some way by the government — are concentrated in “missing middle” housing types like duplexes, fourplexes and cottage courts. Those kinds of homes are now largely illegal to build in most places that allow homes without special approval from the city. Those kinds of homes likely wouldn’t automatically be affordable to lower-income families if Dallas allowed them to be built today, Flores acknowledged. Allowing more “missing middle” housing would provide at least some cost relief by easing the supply crunch.

There are some bright spots, the report notes. Dallas rents have been relatively flat the past two years following major spikes during the COVID-19 pandemic. The city added 8,400 new apartments in 2024, some 16% of which were targeted for low-income households.

However, homebuilding has slowed in the Dallas region, Texas and the nation amid higher interest rates, steeper material costs and a labor shortage.

To some extent, Dallas officials have acknowledged the crunch. Of the city’s new affordable units in 2024, about three-quarters were created with city programs, the report found.

The Dallas City Council approved a comprehensive land-use plan in 2024 that aims to encourage more kinds of housing in what have long been single-family neighborhoods.

Texas lawmakers made it easier last year for Dallas officials to act on that plan and ease decades-old rules that restrict how many homes can be built and drive up the cost of housing, allowing for more “missing middle” housing types.

The idea is that allowing more homes to be built, even if they’re not targeted toward low-income residents, relieves some pressure from lower-income households because they won’t have to compete as much with families who are better off for the same housing stock.

Dallas is overhauling its zoning code, which will likely include measures to broadly allow more homes to be built, a notion that has riled homeowners in single-family neighborhoods in the past. That plan likely won’t be approved until 2027 — and that’s if enough city council members approve it.

“It is the constant struggle that we engage with here at City Hall, between protecting the historical fabric of the communities that people are used to and familiar with comparing that to what you see in other modern cities where duplexes, triplexes, fourplexes, are allowed to be interspersed,” said Dallas City Councilmember Chad West, who has pushed for measures to improve the city’s housing costs.

In the meantime, Dallas officials tweaked the city’s parking rules to make it possible for builders to construct more homes and fewer parking spots on land they own. The city’s voters also approved an $82 million housing bond in 2024, which included dollars to help fund affordable housing projects. City officials have also sped up the city’s notoriously long wait times for new building permits from the city, long a source of frustration for builders.

Texas lawmakers also staged unprecedented interventions last year to ease the state’s sizable housing shortage, making it easier to build apartments in more places and houses on smaller lots in some places. West warned that if city officials don’t make changes to allow more housing, state lawmakers will make those changes for them.

At the same time, the Communities Foundation of Texas has embarked on a $100 million push to boost the city’s housing supply — with the aim of building or preserving 5,000 homes over the next decade.

“I see a much more thriving community” if Dallas addresses its housing woes, said Wayne White, the foundation’s CEO and president. “I see a better Dallas. I see a stronger Dallas. I see this growth that has created this thriving community, I see that continuing, and I think that’s what we all want.”

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