Candace BarnettePro-housing efforts are heating up across the country, with a record amount of pro-housing legislation passed between July 2024 and June 2025, according to a policy brief from the Mercatus Center at George Mason University. States are responding to a national housing shortage that has pushed the median home price to $435,300, well beyond the affordability of the average U.S. household.
The median household income in America is currently $80,610. When compared to the median home cost, this creates an affordability ratio of 5.4, outside the acceptable range of 3-4 that housing economists consider affordable.
In response, states introduced a record 412 bills this year—a 57% jump from 263 the year before—and passed 123, also a new record. The bills largely center around deregulation, overriding local zoning laws to make it easier for developers to build.
The U.S. faces a shortage of 1.5 to 4.5 million homes, according to the brief, which has driven up costs nationwide. States are responding with reforms intended to increase supply while lowering prices.
Texas was especially active in 2025, passing seven significant housing bills despite having only a short biennial legislative session. The state reduced minimum lot sizes to 3,000 square feet for large subdivisions in cities, allowing developers to build more homes per acre.
Texas also made it easier to convert empty office buildings into residential units. A new bill requires large cities to allow housing construction that matches existing density or meets other statewide minimums. The so-called “valid petition” process has also been eliminated, which previously allowed small groups of neighbors to force supermajority votes and block rezoning proposals.
The state also permitted buildings up to six stories high to use single staircases rather than two, reducing construction costs, and prohibited university towns from barring unrelated adults from living together.
On the other coast, California passed what may be its most impactful housing reform yet, according to the brief. The state exempted most infill housing development from the California Environmental Quality Act (CEQA), which had become a tool for housing opponents to delay or kill projects through environmental litigation.
CEQA reviews could last years, even for small developments in already-built areas that posed minimal environmental risk. The new exemption is intended to dramatically speed up construction timelines and reduce costs for housing projects in existing neighborhoods.
California also strengthened protections for accessory dwelling units (ADUs) and housing built on faith-based land. The state legislature is still in session and considering additional major bills, including one that would allow apartment buildings near transit stations.
Several other states made notable progress on housing legislation. Maine passed reforms led by Speaker Ryan Fecteau that set minimum lot sizes at 5,000 square feet for properties with sewer access and 20,000 square feet for those with septic systems. Maine now allows at least three homes per sewered lot and has streamlined environmental approvals that previously slowed development.
A number of other states passed their first major pro-housing legislation during this period. Both Arkansas and Iowa enacted new ADU laws that allow homeowners to build small rental units on their property. Nevada also approved an ADU law, marking its entry into pro-housing policy.
The brief notes that more than half of all states enacted at least one pro-housing bill over the past year, a significant increase in participation compared to previous years.
Looking ahead, the momentum appears likely to continue into 2026. North Carolina could build on its 2024 ban on downzoning by eliminating parking minimums statewide, according to the brief, noting that this reform has already gained unanimous legislative approval in the state.
The first six months of 2025 marked the most successful period yet for pro-housing policies. During that time, states passed 102 bills compared to just 30 in the same period two years earlier, representing more than a threefold increase in successful legislation.
The Mercatus Center, which published the brief, focuses on market-oriented policy research and has been tracking state housing legislation for several years. The center analysis suggests that these record-breaking numbers reflect systematic change rather than a temporary trend, as state governments increasingly recognize that housing affordability affects their ability to attract businesses and workers to their regions.
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