HBAV is actively working to advance legislation to remove barriers to building the homes Virginians desperately need.
The Virginia General Assembly gaveled in Wednesday for its 60-day session, with housing expected to be a central theme as lawmakers look to tackle rapidly rising costs, statewide shortages, and local barriers to new residential development affecting every community in the Commonwealth.
The 2026 session opens as Virginia also prepares for a historic transition in leadership, with Abigail Spanberger set to be sworn in Saturday as the Commonwealth’s first female governor. Spanberger made affordability the centerpiece of her campaign, pledging to increase housing supply, lower costs, and strengthen Virginia’s workforce and economy.
With a number of new lawmakers taking their seats in the House, the agenda in Richmond is still expected to move quickly. In addition to major policy initiatives and four constitutional amendments, legislators are constitutionally required to adopt a two-year budget this session. It’s a process that will carry significant implications statewide.
As the session begins, HBAV has also expanded its government affairs team with the addition of Kara Alley as deputy director of government affairs. In her role, Alley supports HBAV’s advocacy efforts before the General Assembly, executive agencies, and regulatory boards on behalf of Virginia’s home building industry.
“The stark reality is that Virginia is facing a housing shortage of nearly 180,000 units, and that gap is projected to grow to 214,000 by 2030,” said Craig Toalson, CEO of HBAV.
“That reality is shaping the conversation in Richmond. This deficit is driving up costs and pricing working families out of the communities they work or serve. This session, HBAV is focused on targeted, practical initiatives that remove longstanding barriers to housing production and expand housing opportunities so every Virginian can afford to live and work in the communities they call home.”
HBAV’s 2026 Legislative Agenda
HBAV’s 2026 Legislative Agenda focuses on removing state and local barriers to housing production, investing in critical infrastructure to support new residential development, increasing transparency into local housing policies, and protecting critical residential economic development incentives.
Please follow the HBAV blog for the latest on our 2026 Legislative Agenda as legislation is introduced and assigned throughout this session:
Remove Regulatory Barriers to Housing Production
Market-Driven Parking Standards | HB 888 (Delegate Irene Shin)
The Challenge: Outdated minimum parking mandates remain a significant cost driver and barrier to housing production. Many localities require more parking than the market demands, increasing construction costs that are ultimately passed on to homebuyers and renters. Excessive parking requirements also consume land that could otherwise be used for housing, reducing the number of units that can be built on a site.
What Our Bill Does: HB 888 caps minimum off-street parking requirements for projects near mass transit and public transportation, within certain residential, mixed-use, and revitalization zones, and certain affordable housing developments. The bill also requires certain localities to administratively approve minimum off-street parking reductions of at least 20% in specified areas.
Small Lot Ordinances | HB 1212 (Delegate Briana Sewell)
The Challenge: In many Virginia communities, zoning rules limit housing options by requiring large lots and low densities, even where demand is strongest. These requirements raise per-home land costs, restrict housing near employment and transit, and reduce opportunities to build entry-level homes.
What Our Bill Does: HB 1212 requires localities over 20,000 people to create at least one small-lot residential zoning district that allows one- and two-family dwellings and townhomes by-right on lots of 3,000 square feet or less. Localities must implement this new district in a way that increases by-right residential development capacity compared to what was previously allowed.
Housing Near Jobs: Multifamily in Commercial Districts
The Challenge: Housing demand has outpaced supply for decades, particularly near employment centers and transportation corridors. In many jurisdictions, new residential and multifamily development is subject to lengthy rezoning processes that add months or years of delay, increase pre-construction costs and deter investment where housing is most needed. Expanding opportunities for by-right residential and multifamily development in commercial districts would reduce approval timelines and accelerate housing production near job centers.
What Our Bill Does: The bill requires localities to allow residential and multifamily development by-right in designated commercial zoning districts, eliminating the need for discretionary rezoning approvals and enabling faster, more predictable pathways to housing production.
Reduce Infrastructure Cost Barriers
Residential Development Infrastructure Fund | HB196 (Delegate Josh Thomas)
The Challenge: Infrastructure costs — water, sewer, roads, and stormwater systems — are a major barrier to new residential development. These upfront investments can make housing projects financially unviable, particularly in areas where new infrastructure is needed to support growth. Without dedicated funding to help localities expand capacity, housing production stalls and communities miss opportunities to attract residents and businesses that drive economic growth.
What Our Bill Does: HB 196 would create a Virginia Residential Development Infrastructure Fund to provide grants and loans to localities for water, sewer, stormwater, and transportation infrastructure needed to support new residential development. The fund would be managed by the Virginia Resources Authority in coordination with the Department of Housing and Community Development (DHCD).
Water and Sewer Connection Fees
The Challenge: In many Virginia communities, connection fees now exceed $15,000-$25,000 per unit, pricing first-time buyers out of homeownership and adding significant upfront costs to starter home construction.
What Our Bill Does:The bill allows localities to fully or partially reimburse first-time homebuyers for water and sewer connection fees, capital recovery charges, and availability fees for new residential developments. It additionally requires localities with an affordable dwelling unit ordinance to waive these fees and charges for developments subject to the ordinance.
Increase Transparency and Streamline Processes
Local Housing Policy Transparency | HB356 (Delegate Josh Thomas) and SB665 (Senator Srinivasan)
The Challenge: Virginia lacks consistent, statewide data on local housing policies and development activity. Without reliable information on land-use regulations, development standards, and housing production, policymakers cannot effectively identify barriers to housing or measure progress toward addressing the shortage.
What Our Bill Does: Strengthens annual reporting requirements to the Department of Housing and Community Development (DHCD) summarizing changes to local policies, ordinances, fees, and processes affecting residential development, along with data on housing applications, approvals, and related studies. Reports are standardized by DHCD and made publicly available.
Virginia Housing Trust Fund Awards | HB1043 (Delegate Betsy Carr)
The Challenge: Affordable and Special Needs Housing funding decisions can take months to finalize, creating uncertainty for applicants and slowing down housing projects that rely on timely award decisions.
What Our Bill Does: This bill directs the Department of Housing and Community Development (DHCD) to review all applications and notify each applicant of an award or denial no later than 75 days after the application submission deadline. It also designates DHCD as responsible for providing applicants initial notice of award or denial before any public announcement is made.
Preserve & Expand Critical Housing Incentives & Financing Tools
Economic Development Authorities, Bond Financing | HB806 (Delegate Betsy Carr)
The Challenge: Under current law, many economic development authorities cannot issue bonds to finance new residential construction projects. Economic development authorities can be an important financing tool for the housing industry.
What Our Bill Does: HB806 allows all economic development authorities to issue bonds to finance new residential development projects.
Third-Party Challenges to Land Use Decisions | HB447 (Delegate Marcus Simon)
The Challenge: Over the past several years, the Virginia Supreme Court has expanded the ability for third-parties to challenge local land use approvals, delaying projects, adding costs, and creating uncertainty for both localities and the development community.
What Our Bill Does: HB447 codifies a decades-old two-prong test that requires third-parties to show a particularized harm and proximity to the property to challenge these approvals, ensuring that the development community can rely upon legally-approved zoning cases.
Housing Performance Grants | HB352 (Delegate Josh Thomas)
The Challenge: Industry and local governments need additional, flexible financing tools to increase the supply of for sale and rental housing. Research has shown that incentives that offset rising land costs are more effective than mandates.
What Our Bill Does: HB352 provides localities, economic development authorities, and the housing industry an innovative new tool to create project-specific financing agreements that ensure projects with below-market-rate units remain financially viable.
What to Expect Next
Alongside the priorities we plan to advance, we’re closely reviewing a wide range of proposals that could have unintended consequences for home building in Virginia. You’ll hear more from us as that work continues in the weeks ahead.
Your engagement will be essential in the days to come. Conversations with local legislators play a critical role in helping policymakers understand what it takes to deliver safe, quality and attainable housing across the Commonwealth. We appreciate your partnership as the session unfolds.
Want HBAV to hear your take? Fill out our survey. Your input helps shape HBAV’s approach to housing policy in Virginia.
HBAV Members: Join us Wednesday, January 28 for our Day at the General Assembly
It’s vital that members join us. Please coordinate with your local HBA to schedule meetings with members of the General Assembly between 7:30 and 11 a.m.
Showing up makes a difference. After meetings at the General Assembly, HBAV will host all members and guests for lunch and a debrief meeting in the James Center Conference Room. Lunch will be provided for registered participants.