The session is now at its halfway point with no signs of slowing down before March 14.
The 2026 General Assembly session reached a key inflection point this week as lawmakers hit Crossover — the midpoint deadline that forces each chamber to act on its own legislation. For housing policy, the moment offered the clearest picture yet of which proposals have real traction and which efforts have stalled as the session moves into its final stretch.
At a high level, the tone in Richmond has been notably active on supply-focused housing policy. HBAV priority legislation aimed at removing regulatory barriers, expanding by-right development opportunities and addressing infrastructure cost pressures continues to move through the process, with several measures clearing the House and advancing to the Senate. At the same time, a number of proposals opposed by the industry have been defeated or pushed to future sessions, reinforcing a legislative environment that remains competitive but productive.
Crossover, which occurred Wednesday, represents an important turning point in the session. From this point forward, the legislative funnel typically narrows as surviving bills face closer scrutiny in the opposite chamber and fiscal pressures begin to thin the field. With the session scheduled to adjourn March 14, the coming weeks will determine which housing policies ultimately reach the Governor’s desk and which proposals lose momentum.
This week’s progress has also drawn outside attention. Recent coverage from Radio IQ highlighted HBAV’s supply-side priorities, including legislation to modernize parking requirements and expand small-lot development opportunities, while a national outlet, The Wall Street Journal, published the article “Big Tech Is Buying Up America’s Land — and Home Builders Can’t Compete,” which includes mention of Virginia’s housing market.
Read our legislative status update and watch Toalson’s video message:
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 throughout this session:
Remove Regulatory Barriers to Housing Production
Market-Driven Parking Standards | HB 888 (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The Challenge: Outdated minimum parking mandates remain a significant cost driver and barrier to housing production.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.
Status: The bill passed the House 61-37 and now heads to the Senate for consideration.
Small Lot Ordinances | HB 1212 (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: Requires localities with populations over 20,000 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.
Status: The bill passed the House 62-35 and now heads to the Senate for consideration.
Housing Near Jobs: Multifamily in Commercial Districts | HB 816 (Helmer) and SB 454 (VanValkenburg)
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.
Status: HB 816 passed the House 64-35 on a party-line vote and now heads to the Senate for consideration. SB 454 passed the Senate 21-19 on a party-line vote and now heads to the House for consideration.
Reduce Infrastructure Cost Barriers
Residential Development Infrastructure Fund | HB 196 (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).
Status: The bill passed the House 92-6 and now heads to the Senate for consideration.
Water and Sewer Connection Fees | HB 1144 (Martinez)
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.
Status: Passed the House Counties, Cities and Towns Committee as amended, changing the language from mandatory to permissive. The bill passed the House 64-34 and now heads to the Senate for consideration.
Increase Transparency and Streamline Processes
Local Housing Policy Transparency | HB356 (Thomas) and SB665 (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.
Status: HB 356 passed the House 86-13 and has been referred to the Senate General Laws and Technology Committee. SB 665 was reported from the House General Laws Committee with amendments and now advances in the House.
Virginia Housing Trust Fund Awards | HB 1043 (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.
Status: HB 1043 passed the House unanimously and is now before the Senate General Laws and Technology Committee.
Preserve & Expand Critical Housing Incentives & Financing Tools
Economic Development Authorities, Bond Financing | HB 806 (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 expands the authority of local industrial development authorities (IDAs) to support residential development by removing the current restriction that limits housing-related IDA powers in localities where a housing authority has been activated. The bill allows IDAs statewide to use their existing financing tools for single-family and multifamily residential projects and grants explicit authority to issue bonds for affordable housing construction.
Status: The bill passed the House 85-12 and will now be considered by the Senate.
Third-Party Challenges to Land Use Decisions | HB 447 (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.
Status: The bill was continued to the 2027 session in the House Courts of Justice Committee.
Housing Performance Grants | HB 352 (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.
Status: The bill passed the House 78-21 and will now be considered by the Senate.
Additional Legislation Tracked by HBAV
Rent Control | HB 278 (Clark), HB 1177 (Cole), SB 355 (Boysko)
Allows localities to pass ordinances limiting the amount that rents can be increased from year to year. This would lead to a decrease in the quality and quantity of available rental housing, discourages new construction investment, and exacerbates housing shortages.
HBAV’s Position: Oppose
Status: Defeated (continued to 2027 Session); referred to Committee on House General Laws; and referred to Committee on Senate Local Government, respectively.
Impact Fees | HB 536 (Hamilton), HB 1430 (Cousins)
Impact fees raise upfront development costs, which are ultimately passed on to homebuyers and renters, making housing less affordable. They also discourage or delay new construction, reducing housing supply and worsening shortages.
HBAV’s Position: Oppose
Status: Defeated
Inclusionary Zoning | SB 74 (McPike), HB 867 (Cousins), HB 181 (Rasoul)
Allows localities to create mandatory affordable housing dwelling unit programs. This discourages development and will exacerbate the shortage of missing middle-housing supply.
HBAV’s Position: Oppose
Status: SB 74 is in conference after the House insisted on its substitute. HB 867 passed the House 68-30. Amendments include a delayed effective date and a reenactment clause, meaning the bill will not take effect unless it passes again in 2027. HB 181 passed the House with reenactment language, meaning it will not take effect unless it is passed again in 2027.
Mandatory Adoption of Latest Energy Code | HB 377 (Bennett-Parker)
Would unravel Virginia’s Building Code adoption process through legislation, requiring immediate adoption of international energy code. Virginia ranks high in building code adoption and enforcement compared to other states. Virginia Building Code updates incorporate and amend for these international provisions to improve energy performance through enhanced standards for insulation, windows, lighting, ventilation, and HVAC sizing compared to older rules.
HBAV’s Position: Oppose
Status: Continued to the 2027 General Assembly.
Watch HBAV Testimony from Andrew Clark, HBAV VP of Government Affairs
Adequate Public Facilities | SB 781 (Sturtevant)
Allows local governments to deny or delay rezoning requests solely because they determine existing public facilities are inadequate to support new development. This gives localities broad discretion to block or indefinitely delay rezoning — creating uncertainty, increasing costs, and restricting housing supply even when developers are willing to help fund or phase in needed infrastructure.
HBAV’s Position: Oppose
Status: Defeated
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