In the years following the Covid-19 Pandemic, the affordability and availability of homes has become a glaring issue in Pennsylvania and beyond, primarily due to rising interest rates, inflation, labor shortages, and an overall shortage of housing supply. In January 2024, housing listings were down nearly 20% and sales dropped more than 3% year-over-year with a median home price that is 42% higher than it was in January 2019, according to the Pennsylvania Association of Realtors.

In recent months, Pennsylvania lawmakers on both sides of the aisle have sponsored bills that emphasize the urgency of the housing crisis facing the Commonwealth. These laws could have significant impacts on the future of municipal law and land use development.

House Republicans have put forth 12 bills aimed at alleviating the housing affordability and supply issue. Among those bills, which include proposals that will include tax breaks, grants, and incentives for homeowners and builders, a bill sponsored by Rep. Andrew Kuzma (R-Allegheny/Washington) would require municipalities to provide annual reports about their individual housing needs, shortages, and solutions. Another bill introduced by Rep. Thomas Kutz (R-Cumberland) would create an “Attainable Housing Community Designation,” for those municipalities that allow for mixed-use developments, accessory dwelling units, missing middle housing, or that support programs to refurbish existing homes. By receiving an “Attainable Housing Community Designation,” a municipality would receive priority consideration with the Pennsylvania Housing Finance Agency for Pennsylvania Affordability Fund grants.

In February, House Democrats put together their own set of bills that include revisions to the Municipalities Planning Code that would affect more than 600 cities, boroughs, and townships with a minimum population of 5,000 residents. One such bill, sponsored by Reps. Joshua Siegel (D-Lehigh), Manuel Guzman (D-Reading), and Tarik Khan (D-Philadelphia) would allow empty offices and retail spaces that are located in commercial zoning districts to be converted into multi-family housing units. Another bill, also sponsored by Rep. Siegel, would mandate local zoning ordinances to allow duplex, triplex, and quadplex housing on parcels zoned for single-family lots. If enacted (and pending the disposition of any potential litigation), these bills would have significant impacts on the future of land use development, community planning, and municipal law.

While the future of these bills hangs in the balance of the Pennsylvania General Assembly, one thing seems clear: lawmakers on both sides of the aisle are determined to provide solutions for the housing crisis facing our communities. McNees is continuing to follow these state law developments to determine their immediate and future impacts for all of our municipal, real estate, and land use development clients. We will provide additional updates as they become available. If you have questions about any of these potential state law developments, please do not hesitate to contact a member of the McNees Real Estate Group.