States Embrace Diverse Strategies to Ease Housing Supply Constraints

This is one in a series of five articles examining key debates that will unfold in the nation’s statehouses in the year ahead.

High housing costs continue to be a major concern among Americans, and in the coming months, state lawmakers can build on bipartisan approaches taken last year to ease the nation’s housing shortage, a key driver of soaring rents and home prices.

In 2024, states passed 50 bills aimed at increasing housing production, according to George Mason University’s Mercatus Center—20 more than over the same period in 2023. Lawmakers in a diverse set of states sought to address barriers to housing development by streamlining lengthy and costly permitting requirements and revising restrictive zoning laws, among other efforts.

Arizona, Colorado, Florida, Hawaii, and Maryland passed legislation in 2024 to allow apartments in some or all areas near commerce or transit, such as urban downtowns. Arizona and Hawaii’s bills also required that municipalities allow vacant offices and other underused commercial space to be turned into housing.

In Arizona, then-House Majority Leader Leo Biasiucci (R) said in an interview with The Pew Charitable Trusts that H.B. 2297, which passed in April with strong bipartisan support would reduce the time it takes local governments to approve new housing. Representative Biasiucci explained that previously, building homes on commercial lots in the state—often “old grocery stores or strip malls that have outlived their useful life”—meant navigating rezoning processes that could take as long as four years. By automatically allowing housing to be built, the bill bypasses that process.

“We can increase supply, which in turn will help lower rent prices,” Rep. Biasiucci, the bill’s sponsor, said. “Lower rents mean more disposable income for consumers, which supports local small businesses and boosts the economy. In the end, it all comes down to increasing supply.”

The bill’s passage by 24-3 in the Senate and 43-15 in the House illustrated how “legislators, regardless of their political differences, recognized the urgent need to address this issue in their communities,” he said.

A law passed during Montana’s last legislative session in 2023 to allow housing in commercial areas also enjoyed strong bipartisan support, including from all members of the Senate. S.B. 245’s sponsor, Senator Daniel Zolnikov (R), said the measure will lower the cost of building because the homes would be in places where water lines and other infrastructure already exist. And because the buildings would be near stores and businesses, more people would be able to live closer to work.

“It was just common sense,” Sen. Zolnikov told Pew in an interview.

Permitting

Like zoning regulations, onerous permitting procedures can slow housing development. Builders face higher costs for staff, attorney, and consultant time, as well as interest on borrowed money, while waiting for local government approvals. But a recent study, published by New York University’s Furman Center and funded by The Pew Charitable Trusts, found that California’s 2017 law, which streamlined requirements for affordable housing, reduced the average permitting time in Los Angeles from seven months to 2.7 months.

In 2024, Arizona, Colorado, Florida, Hawaii, New Hampshire, Oregon, Rhode Island, Tennessee, Vermont, and Virginia passed legislation to streamline local permitting processes. Among the reforms was Florida’s H.B. 267, which required local governments to process permits for single-family, duplex, triplex, and quadplex structures of less than 7,500 square feet within 30 days.

Co-housing

Other states sought to allow more people to save money on rent and utilities by sharing living spaces. For instance, Hawaii’s H.B. 2090 and Washington’s H.B. 1998 eased local restrictions on “microunits”—essentially a higher quality version of the boarding houses of old—in which residents have private rooms but share kitchens, bathrooms, and common areas.

This type of housing provides opportunity for very low-income people. For instance, in Portland, Oregon, a formerly homeless man who arrived at a microunit building with only a backpack now has a room with a bed, chair, TV, decorative lights, potted plants, and action figures.

And research indicates that adapting office buildings into microunits rather than apartments reduces plumbing costs, making conversions of vacant office buildings into housing more financially feasible for developers. A recent study by Pew and Gensler, a global architecture firm, found that converting a Denver office building to 120- to 180-square-foot microunits would cost $123,000 per unit, less than half of the $400,000 cost to turn it into studio apartments, in part because each room did not need its own bathroom and kitchen. The study estimated that those microunits would rent for $850 versus $1,420 for a studio. Similarly, in downtown Seattle, the analysis determined a microunit could run $1,000 a month, compared with $1,530 for a studio, and in Minneapolis, $750 instead of $1,100.

After rents across Washington state increased by 42% from 2017 to 2023, bipartisan lawmakers passed H.B. 1998, requiring municipalities to allow microunits because they can offer far lower rents than studios, according to the bill’s sponsor, Representative Mia Gregerson (D). “This is not a new idea,” she said. “This is an old idea, a good idea that we need to bring back again.”

Meanwhile, Colorado’s H.B. 1007 addressed another issue preventing people from sharing housing: regulations in municipalities that barred more than two unrelated people from living together. “In the midst of the housing crisis,” allowing people to live together is “a powerful and free tool that states can employ in order to help ... their constituents,” one of the bill’s sponsor, Senate Majority Whip Julie Gonzales (D), said in an interview with Pew. Colorado became the third state, after Iowa in 2017 and Oregon in 2021, to pass such a so-called “Golden Girls” law, removing caps on housemates.

Senator Gonzales also said that her legislation showed how lawmakers from both parties can work together to address a main concern of their constituents. “It was a powerful way to build consensus across the aisle,” she said. “I really encourage legislators in blue states and red states alike to consider this as a straightforward way to meaningfully address the housing crisis.”

Single-stair construction

Another way to reduce the cost of multifamily housing is allowing apartments to be built with a single staircase. Nearly all cities require two staircases for buildings over three stories, which was adopted as a fire-safety measure before the development of modern fire-suppression technology, such as sprinklers. However, allowing a single stairway while also requiring contemporary fire-safety measures would enable construction of new, fire-safe buildings with family-sized units.

In 2024, Connecticut and Tennessee passed legislation to enable single-stair buildings, and California, Minnesota, New York, and Virginia each directed a state agency to examine making the change. In Connecticut, lawmakers had many discussions “on how to make housing more affordable and to enable us to build better and more appropriate housing,” Representative Maria Horn (D) explained when the bill was being debated in the House. “We have learned that our rules create pretty onerous requirements for building a number of stairwells in residences.”

Rep. Horn emphasized that Connecticut’s new law featured “safety and egress” requirements, including that single-stair buildings have automatic sprinkler systems and “any features necessary to allow for firefighters to ascend a stair as occupants descend.”

Tennessee’s H.B. 2925 took a different approach. Lawmakers changed their state’s building code to enable municipalities to permit single stairs in multifamily buildings up to six stories, so that local governments can “choose this methodology to try to reduce costs in their area,” one of the bill’s co-sponsors, Representative Kevin Vaughan (R), said on the House floor before the vote.

Rep. Vaughan emphasized that the bill requires that single-stair buildings have no more than four units per floor, with each no more than 20 feet from the stairs. “This provides a way to build structures where your travel distance is up and down, as opposed to down long corridors,” he said, adding that the state’s building code also requires that single-stair buildings have sprinklers.

A holistic approach

State policymakers are likely to also consider a wide range of other housing strategies in 2025, from authorizing accessory dwelling units (ADUs)—sometimes called “granny flats” because people often use them to house family members—to lifting parking requirements.

Last year, Arizona, California, Colorado, Hawaii, Massachusetts, and Rhode Island passed laws allowing spaces—such as garages, backyards, basements, and attics—to be turned into ADUs. California’s bill strengthened an existing state law that already allowed ADUs. These units, cost less to build than houses or apartments and can also provide inexpensive housing for nonrelatives. Rhode Island’s H.B. 7062, for instance, removed requirements that ADUs could only be used for family members.

California, Colorado, Maryland, New Hampshire, and Washington enacted legislation eliminating or lowering parking requirements for new multifamily developments, a move expected to lower costs and allow more units to be built.

“Upzoning”—expanding the list of housing types allowed in some residential areas—is also a popular tool. Arizona and Washington now require that duplexes, triplexes, and fourplexes be allowed in certain areas that were previously zoned for single-family homes, and Maryland, Colorado, Utah, and Washington all increased the number of homes allowed around transit.

Because several issues are driving the housing shortage, Rep. Gregerson, who has sponsored various bills in Washington, said solving the nation’s housing deficit requires a “holistic approach.”

Arizona’s Rep. Biasiucci agreed. “No single piece of legislation will solve the housing shortage, but incremental progress is essential,” he said. “Legislators across the country should look to successful policies from other states and consider adapting them to their own contexts. Pursuing a range of legislative fixes will gradually help address the national housing deficit.”

Kery Murakami writes for The Pew Charitable Trusts’ housing policy initiative.