There's a difference between homesteading and squatting. Homesteading is building a domicile where there wasn't one. Squatting is occupying a space in lieu of action. Ask yourself: if these people were to apply for a building permit and do it all according to Hoyle, would they succeed? What would it cost? Could they afford to do it?
The answer is no. Because when they're accorded the rights and protections of citizenship they end up in a dwelling three or four times as expensive. That doesn't mean that Texas should tolerate shantytowns. It means that Texas needs to start subsidizing housing.