State-Level Housing Reforms Make Big Strides in 2025
This year, housing policy experts have pointed out that 2025 has been a remarkable period for state-level reforms aimed at enhancing housing issues. There’s a real push to address the housing supply and tackle the affordability crisis, and it seems some states are really stepping up.
According to tracking data, 124 pro-housing bills were passed by state legislatures in the year ending June 2025. This comes from the Mercatus Center at George Mason University, which is known for its libertarian perspective. To put this in context, the previous year saw only 40 such bills. So, clearly, there’s been a significant uptick in efforts to expand housing options.
Salim Firth, who directs Urbanity Projects at Mercatus, remarked during an online symposium that, “this year has been phenomenal for gains in housing supply.” It’s kind of astounding to see the number of bills tripling in just two years, and many of those bills are really impactful.
Firth specifically mentioned five states that have introduced major housing packages this year: Texas, California, Washington, Montana, and Maine.
In Texas, seven crucial housing bills were enacted, which included changes like reducing minimum lot sizes in major cities, allowing residential construction in commercial zones, and removing the often cumbersome petition process that could block new developments.
California, often viewed as the original state grappling with housing crises, has also made notable progress in reforming regulations that typically hinder new development. A significant new law now exempts most infill housing projects—basically, building on or redeveloping existing urban lands—from certain state regulations. This is crucial, especially given how environmental review processes can sometimes be misused to obstruct new home construction.
Furthermore, California passed SB 79, an important law permitting apartment construction near public transport, regardless of previous zoning restrictions. Interestingly, Governor Gavin Newsom backed this measure despite pushback from local leaders like Los Angeles Mayor Karen Bass, who voiced concerns about losing local control over zoning.
In San Francisco, Mayor Daniel Lurie recently got the Family Zoning Plan through, aiming to streamline regular zoning practices in line with state law for new housing creation. Firth praised this as a win for advocates who have been pushing for changes over many years.
In terms of political context, there seems to be a bipartisan consensus on housing reform in states with differing political landscapes. For instance, while Montana and Washington often have contrasting political views, both states passed important laws that limit local parking requirements, which can deter new developments.
In Montana, the law stipulates a minimum of one car parking space per housing unit. Meanwhile, Washington eliminated parking requirements for smaller apartments and put caps on parking for larger homes in towns of over 30,000 residents. Montana also became the first state to directly pre-empt local building height restrictions, mandating that cities allow residential buildings up to 60 feet tall in designated areas.
Montana’s reforms extend to allow accessory housing units, simplify construction for industrial parks, and mandate that certain legal disputes favor “free use of property.” Maine also enacted regulations to limit parking to one space per home in specified growth zones, alongside reforms to streamline environmental approvals.
