A uniform statewide building code would speed development times and lower costs

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Home building is tough throughout New England, but Massachusetts gives its builders an advantage that builders in New Hampshire don’t enjoy. Massachusetts uses a uniform building code statewide. Builders there know exactly what every town’s code is because they’re all the same.

That’s not so in New Hampshire, where municipalities can tack their own rules onto the state building code. This random patchwork of building codes raises costs and slows projects.  

“It’s just all over the place,” builder Matt Blanc of Charlestown said. “Just getting things standardized would be huge for us.”

The local requirements themselves can add tens of thousands of dollars to the cost of a new home or apartment building. That can be a particular problem for small contractors. 

“Some communities will require a full-blown commercial fire alarm system in an apartment with two units in it,” Blanc said. “That could be a $10,000-$20,000 cost.”

More frustrating are the surprises and delays. Towns can adopt new codes anytime, and builders don’t necessarily find out about them until construction has begun.

“We get into building stuff and the plans are approved, and then we’re ready for our first inspection and all of a sudden we’ll find out that local jurisdictions have some other requirements that we haven’t done and we didn’t even know about it,” Blanc said. “It causes project delays.”

And every delay adds to the cost of a project.

“When we have guys standing around not producing, it gets very, very expensive in a hurry,” Blanc said.

Even small builders can have projects in multiple towns at once. The variations can be a planning nightmare.  

“When you have it for 10-12 projects going on, it really adds up,” Blanc said.

That’s why New Hampshire builders are keeping a close eye on House Bill 428 and Senate Bill 94, companion bills that would forbid municipal amendments to the state building code. 

SB 94 was retained in the House Executive Departments and Administration Committee this week in the hope that the Senate would agree to pass HB 428. The House amended HB 428 one to allow local variations in administrative procedures, but not the technical substance of the code. 

Building codes are not the same as land use regulations (zoning rules). A building code is a set of minimum standards for building construction. Local governments often adopt amendments that set higher standards than the state code. And those aren’t always for safety reasons. Extreme energy efficiency standards are a trendy local code enhancement which can push already high home prices out of reach even for upper-middle-class families. 

“It tends to be things that some member of code enforcement heard about at some convention and thought it was a great idea and the town implemented it,” Blanc said.

Because the purpose of building codes is to establish minimum safety standards, the case for local boutique additions is not strong. A building code is a highly technical set of regulations of structural and electrical engineering. Allowing local variations does not enhance individual freedom, but limits it. The only enhancements localities can make are additional restrictions on top of basic safety standards.

As Matt Mayberry, executive director of the New Hampshire Home Builders Association, said in a Senate hearing this month, “I put my trust in 424 individuals to make those policy decisions for our state of New Hampshire versus a five-member town council or select board, who may be more socially driven than policy driven.” 

The National Multifamily Housing Council and the National Association of Home Builders estimate that regulations account for 40.6% of the cost of multifamily housing and that changes in building codes in the last decade are the single largest contributor, accounting fro 11.1% of costs.

Switching to a statewide standard building code would lower costs and speed development times for both residential and commercial development. And it would eliminate one of the advantages Massachusetts has over New Hampshire.

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Legislature moves 15 housing bills in one day

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New Hampshire’s housing shortage, and the price spike that it created, has made housing the No. 1 problem facing the state, according to University of New Hampshire polling. Fixing the state’s housing shortage is such a priority for voters that a 2024 UNH poll found more than 1/3 of voters rating it as the top problem, with the No. 2 problem a full 29 points behind. In response, the state House of Representatives has created a standing Committee on Housing to deal with the issue. 

Forty-eight housing-related bills have been introduced to the House Housing Committee (22) and Senate Commerce Committee (26) this session. Nearly 1/3 of those bills were considered by the House and Senate on Thursday, March 20. 

Below is a brief summary of each of those 15 bills. Eight were placed on the consent calendar, which means they received unanimous votes out of committee. (One was pulled off the House consent calendar Thursday morning.) To give the reader a sense of how the committees prioritized each bill, we list them by their position on the calendars. We also include how each chamber voted on each bill.

Thursday’s action suggests that legislators have gotten the message that voters want action to increase the supply of housing, and they want it now. 

 

SENATE

Consent Calendar

  • Senate Bill 90, allowing high-density residential development on land zoned for commercial use. Re-referred to committee. 

SB 90 defines a “high density residential zone” as one that allows at least 20 residential units per acre, and it adds to RSA 674 the requirement that “municipalities shall allow high-density residential development on land zoned for commercial use, provided that adequate infrastructure, including roads, water, and sewage systems, shall be available or provided to support the development.” 

  • Senate Bill 170, relative to development and related requirements in cities, towns, and municipalities. Passed by voice vote. 

SB 170 incorporates multiple proposals into a single bill. It:

  1. Prohibits municipalities from mandating that occupants of housing units be related by blood or marriage;
  2. Prohibits cities, towns, municipalities, and counties with unincorporated places from mandating more stringent test-pitting requirements for septic systems and more stringent well-siting requirements than the Department of Environmental Services does;
  3. Prohibits municipalities from imposing maximum road lengths to impede development, provided that the proposed roadway or extension complies with the state fire code;
  4. Prohibits municipalities from capping the number of housing lots on dead-end streets; 
  5. Requires municipalities to permit utilities (including septic systems, wells, electric systems, drainage structures, and other utilities) to be placed in open spaces or perimeter buffers of subdivisions as applicable; provided that such open spaces or perimeter buffers are not wetlands or shoreland areas protected by RSA 483-B;
  6. Requires municipalities to stamp and accept changes to plans within three days, after an initial review, when requested by that city, town, or municipality, provided the developer has made the requested alterations based on the initial planning board review; 
  7. limits road frontage requirements and setbacks for lot lines to no more than 50 feet.
  • Senate Bill 173, relative to residential property subject to housing covenants under the low income housing tax credit program. Passed by voice vote.

Rent-restricted residential housing enrolled in the Low-Income Housing Tax Credit Program can be assessed under state law in one of two ways. It is either taxed at 10 percent of income generated by the property, or subject to the following formula:

“The assessed value shall be calculated using an income approach whereby the net operating income is divided by the overall capitalization rate and, except when the municipality has updated its assessment values to equate to market values, multiplying that value by the previous year’s equalization ratio.”

SB 173 eliminates the formula so that the simpler 10% tax will be used. Because it eliminates a complicated formula inconsistently applied by municipalities, it has the support of assessors, municipalities and developers. 

  • Senate Bill 175, relative to the use of covenants by municipalities. Re-referred to committee.

SB 175 would prohibit municipalities from “requiring or encouraging the establishment of covenants as a condition of any zoning or land use approval.” Existing covenants created by landowners or homeowners associations would be grandfathered. The Senate Commerce Committee concluded that the bill needed more work and recommended that it be sent back to committee.

  • Senate Bill 281, relative to property adjacent to Class VI roads. Passed by voice vote.

SB 281 allows homes on class VI roads if the property owner signs a waiver acknowledging that the road is not maintained and the municipality is not responsible for damages. Buildings on the property also must be insurable. A Class VI road is an unmaintained road.

  • Senate Bill 282, relative to stairway requirements in certain residential buildings. Passed by voice vote.

SB 282 allows multifamily buildings of up to six stories to be built with a single staircase, provided certain safety requirements are met.  Mandates for dual staircases increase building footprints and costs. Single staircase designs are common in most of the rest of the world, at heights considerably taller than six stories. 

  • Senate Bill 283, relative to the calculation of floor-area-ratios under local building ordinances. Passed by voice vote.

SB 283 exempts below-grade ares from the calculation of floor area ratios. Floor area ratios are the portion of floor area of a building relative to the size of the parcel of land. Municipalities use floor area ratios to limit how large a building can be relative to its lot size.

Regular Calendar

  • Senate Bill 84, relative to zoning procedures concerning residential housing. Passed 13-10. 

SB 84 caps minimum lot sizes at 2 acres in areas not served by water or sewer, 1.5 acres in areas served by water only, and half an acre in areas served by both water and sewer. 

  • Senate Bill 163, repealing the temporary moratoria and limitation on building permits and the approval of subdivisions and site plans. Passed by voice vote.

SB 163 repeals the portion of state law allowing municipalities to impose temporary moratoria on the issuing of building permits or on the approval of subdivisions and site plans.

  • Senate Bill 174, prohibiting planning boards from considering the number of bedrooms a given unit or development has during the hearing and approval process. Passed by voice vote.

SB 174 prohibits planning boards from favoring or disfavoring housing proposals based on the number of bedrooms per unit.

  • Senate Bill 284, relative to the required maximum number of residential parking spaces. Passed by voice vote.

SB 284 prohibits municipalities from requiring more than one parking space per housing unit, with one exception. Workforce housing developments with studio and one-bedroom units of fewer than 1,000 square feet can be required to have 1.5 parking spaces.

 

HOUSE

Regular Calendar

  • House Bill 351, requiring landlords to give tenants of at-will tenancies at least 60-days notice to evict. Tabled.

HB 351 would require landlords to give tenants who are on at-will leases at least 60 days notice before eviction. 

  • House Bill 558, creating a public county registry of the monthly rent charged by landlords for each owned unit and prohibiting landlords from using algorithms or software to determine rental rates. Voted inexpedient to legislate on voice vote.

HB 558 would require county registers of deeds to create an annual registry of rents charged in the county and prohibit landlords from using algorithms or software to determine rental rates.

  • House Bill 628, prohibiting landlords from discriminating against prospective tenants holding certain vouchers under the housing choice voucher program. Voted inexpedient to legislate on a 213-152 vote.

HB 628 requires landlords to rent to anyone enrolled in the Housing Choice Voucher Program (federal Section 8 vouchers).

  • House Bill 631, permitting residential building in commercial zoning. Passed 204-134.

HB 631 would allow multi-family housing on commercially zoned land, provided the infrastructure (such as water and sewer) is available.

Download this policy brief here: JBC Policy Brief 15 Housing Bills in One Day

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Legalizing residential uses in commercial zones can strengthen N.H. communities

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In many areas of New Hampshire it is literally illegal for shop owners, employees and customers to live in an apartment above or next to a business. Yet places that do allow such mixed uses are among the most vibrant and desired areas in the state, for both businesses and residents. 

As state and local officials consider ways to create more housing and improve the economic and social life of New Hampshire communities, legalizing residential housing in existing commercial zones offers an easy and harmless way to do both. 

Portsmouth regularly shows up on lists of New Hampshire’s and America’s most beautiful towns. In 2016, National Geographic speculated that it “might be America’s greatest small town.” It isn’t just the colonial architecture. It’s the vibrancy. In Portsmouth, living above or adjacent to shops, restaurants, taverns and coffee houses has been common for much of the community’s four centuries. 

Before the rise of automobiles and industrialization, towns and cities generally weren’t separated into residential and commercial areas. Almost everyone worked within walking distance of their homes, and many operated shops from their homes. Cities and towns as old as Portsmouth and Exeter offer a window into this pre-zoning past. And they  offer insights into the value of allowing residential development in commercial zones. 

No tourists, shoppers or diners come to Portsmouth—or any other town— to marvel at the residential subdivisions created by 20th century zoning ordinances. Strip malls in exclusively commercial zones attract shoppers who pop quickly in and out, but not tourists and residents seeking to experience the charm of an old New England town. People flock to mixed-use zones to enjoy a thriving community, a place brought alive by the mix of residential and commercial activity in one compact area. 

Municipal bans on residential uses in commercial zones outlawed the creation of new communities like those found in downtown Portsmouth or Exeter. Only by lifting those bans can New Hampshire towns and cities recreate these lost places. 

Instead of protecting homeowners from encroaching businesses, these bans “protect” businesses from encroaching residents. Yet this “protection” actually harms businesses, residents and communities. Ending these misguided municipal bans would provide much-needed infill housing while reinvigorating communities.

Property values

A major misconception commonly used in defense of banning residences in commercial zones is that the strict separation increases property values. The opposite is true. Commercial real estate professionals have recognized for years that commercial properties close to residential properties tend to be more valuable, not less.  

Residential properties also tend to command higher prices when located closer to economically active commercial areas. Contrary to popular belief, housing built near an economic activity center is significantly more valuable. (A 2022 study found a 26% price premium for housing built near activity centers in 2/3 of cities studied, and a 50% premium in a few high-growth cities.) 

As a general rule, mixing residential uses into commercial zones increases the value of both types of properties. These higher values are a result of higher demand. Many people want to live close to shops, restaurants, nightlife and other “third places” where they can build social and economic connections.

Safety

Half a century ago, author Jane Jacobs noticed that crime in U.S. cities seemed to be lower in neighborhoods that enjoyed more activity in public spaces. Her “eyes on the street” theory held that more people on the streets, or watching from shops and homes, deterred crime. 

This is a widely accepted view, though research is limited. But some researchers have found the theory to hold up under testing. 

A 2013 study of crime in Los Angeles found that “single-use commercially zoned blocks in Los Angeles have crime rates that are 45 percent higher than similar blocks that include residential uses.”

A 2017 study of zoning and crime in Chicago found that commercial areas with higher-density housing were associated with lower crime rates. “Zoning which allows for mixed use structures may be preferable to more restrictive rules that aim for solely residential or commercial use,” the author concluded.

Opposition to legalizing housing in commercial zones often comes from the assumption that new residential units will be high density developments aimed at low-income renters, and will therefore reduce property values and increase crime. On the contrary, because this type of housing is in high demand, it is typically not targeted at low-income renters. That doesn’t mean it will raise overall rents. Mid-range and higher-priced rentals attract people who leave lower-priced units, freeing those units for people with smaller budgets. This filtering effect is why the construction of additional housing units, even at the luxury end of the market, brings down overall rents over time. More supply lowers prices.

Community 

The American Planning Association recommends mixed-use zoning as a way of improving community health and vibrancy. “Mixed-use development provides a variety of environmental, economic, social, and health benefits that can align with existing community priorities, including increasing physical activity,” the association writes.

Far from harming communities, mixed-use development brings numerous benefits. Legalizing residential uses in commercial zones is a way to generate those benefits without imposing costs on existing residential neighborhoods. Because housing is being added to commercial areas, not vice versa, there are no concerns about bringing commercial activities into residential neighborhoods. 

When the Ioka Theater in downtown Exeter closed, it left a void on Water Street. This year, the renovated building is back to life as a mixed-use space anchored by eight condominiums. With demand for office and commercial space still down after the pandemic, the housing portion of the redevelopment was important. All but one of condos sold before the coffee house opened in December, according to the Union Leader. The restaurant and retail space were unfilled at the start of this year. Had the town not allowed housing above the shop and restaurant space, the redevelopment might never have happened. 

By giving property owners multiple streams of revenue, mixed-use zoning serves as a hedge against downturns in commercial and office markets. A building zoned exclusively commercial is at a higher risk of becoming completely vacant than one zoned for both commercial and residential uses. Vacant buildings bring down property values, increase crime rates and fracture communities. Mixed-use zones reduce the risk of building vacancies while bringing people closer together. 

Mixing residential uses into commercial zones also creates more walkable places where businesses and customers mutually benefit from their close proximity to each other. It can reduce traffic congestion, commute times and feelings of isolation.

Conclusion

The colonial downtowns that make Portsmouth and Exeter iconic New England towns were once common throughout New Hampshire. Downtown Concord and Manchester also represent attractive, popular mixed-use districts that developed before zoning separated residential and commercial activities. These are the kinds of vibrant community centers that zoning made it difficult to recreate elsewhere. 

A century after New Hampshire gave local governments the power to separate land by use, it’s clear that municipalities took that authority too far. A power created to keep industrial activities out of residential neighborhoods has been used to keep neighborhoods from popping up in commercial areas. That makes no sense.

There simply is no public health or safety justification for creating commercial-only zones. As long as adequate infrastructure exists to support housing, its inclusion in commercial areas harms no one while creating numerous benefits. 

The benefits of legalizing residential uses in commercial zones include strengthening property values, providing additional housing, increasing economic activity, lowering crime rates, creating a hedge against contractions in the commercial and office markets, and building stronger communities. These are all things elected officials say they want. If they really do, adding residential uses to commercial zones would help.

Download this policy brief here: JBC Policy Brief Residential in Commercial

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Addressing excessive residential lot size regulations

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Imagine that you’ve just graduated high school or college, you’ve landed an entry-level job, and you need a car. What’s on your car shopping list?

It’s your first job, so you’re probably looking for a cheap car, and smaller cars are cheaper to buy and maintain than larger ones.

So you start shopping. To your surprise, you find zero small cars for sale. It’s all full-size SUVs and pickups as far as the eye can see. You ask a salesman where to find the coups and sedan.  

Oh, he’d love to sell you a small car, he says, but he can’t. Every town in the area has a “minimum chassis size” ordinance. They require every vehicle to be at least 16 feet long by 6.5 feet wide. 

But you don’t want a Chevy Tahoe, you protest. You don’t need a big SUV. You don’t have a big family, or even a dog. You just want a small hatchback that’s good on gas. Why would the town make you buy a larger car than you need?

Oh, that’s easy, he says. Town character. 

It’s a family community. If the town let dealers sell small cars, why, young, single people might move there. The character of the town could change. People like the town just the way it was when they moved in. So, no small cars.  

Absurd, right?

Well, replace automobiles with housing in that tale, and you’ve got the status quo throughout New Hampshire. 

To quote the New Hampshire Zoning Atlas created by St. Anselm College, “it is hard to find land to build small homes or starter homes in an economically viable way.” Only 15.7% of the buildable area in New Hampshire allows homes to be built on less than one acre of land with less than 200 feet of frontage.

These mandated large lots are rarely directly related to public health or safety, which makes them legally suspect.

RSA 674:16 grants local governments the power to use zoning “for the purpose of promoting the health, safety, or the general welfare of the community….” 

“General welfare” is vague, but surely it doesn’t include raising the cost of buying a home in town.

When creating a minimum lot size mandate, there are two questions to ask.

  1. What public health, safety or welfare problem does this solve?
  2. How much land does a home require?

The answer to the first question most often is: none. This is especially true in municipalities served by water and sewer infrastructure. A tiny home on a tiny lot harms no one. Small house lots harm no one. 

Large lot size mandates do harm people. They raise the cost of land and homes, pricing many people out of the housing market.

The answer to the second question is: not much.

Two bills in the Legislature would fix lot size inflation by prohibiting local governments from mandating large lot sizes that aren’t directly connected to public health or safety metrics. House Bill 459 and Senate Bill 84 vary in the details, but both would tie minimum lot sizes to legally justifiable standards.

SB 84, facing a Senate vote this week, would cap minimum lot sizes at 1.5 acres in areas with no municipal water or sewer service, one acre in areas with municipal water, and 0.5 acres in areas with municipal sewer service. 

Minimum lot sizes that are larger than 0.5 acres for properties with water and sewer hookups, or larger than basic environmental standards for single-family homes based on soil conditions, serve only one purpose: to raise housing costs. And in that they are extraordinarily successful. 

Large minimum lot sizes have been shown to increase lot sizes, home sizes and home prices. And these government-created price increases spill over into neighboring jurisdictions. 

Tighter regulations spread through adjacent municipalities in a zoning arms race that reduces home construction and raises prices throughout states and regions. That’s a big reason why legislators are intervening. The cumulative effect of these local restrictions is a statewide housing shortage.

Maine has roughly the same population as New Hampshire (1.405 million vs. 1.409 million). Yet Maine has almost 106,000 more housing units than New Hampshire does. As a consequence, its median home value from 2019-2023 was $100,000 lower than New Hampshire’s. As of this January, the median sale price for a home in Maine was $412,200 vs. $493,800 in New Hampshire. 

The median size of a home in New Hampshire is 1,869 square feet, according to Federal Reserve data. The median size in Maine is 1,669 square feet. 

It shouldn’t be harder to buy a smaller, more affordable home in New Hampshire than in Maine. Ending the abuse of lot size ordinances would be an effective way to begin fixing this disparity. 

There is huge market demand for smaller homes on smaller lots. In places where these options are legal, developers have responded. Census data show a decline in new home sizes since 2022, as the chart below from real estate website Keeping Current Matters shows.

In 2013, 36% of new homes in the United States were built on a lot of 7,000 square feet or less. By 2023, it had risen to 46%, according to U.S. Census figures. 

The average size of a newly built home is slowly shrinking. It has fallen from 2,535 square feet in the second quarter of 2022 to 2,375 square feet in the second quarter of 2024. 

The demand for smaller homes is clear, and the market is trying to respond. But municipalities are slowing the transition, particularly in the Northeast. 

In the South, 53% of homes sold in 2023 were smaller than 2,400 square feet. In the West and Midwest it was 60%. In the Northeast it was just 46%. That’s not entirely caused by zoning, but zoning is a factor. 

Nationally, 26% of home buyers want a home less than1,600 square feet, but only 16% of single-family homes started in 2023 were that small, according to the National Association of Home Builders. 

There’s a mismatch between demand and supply, and that mismatch is driven in large part by minimum lot size requirements. Smaller legal lot sizes would facilitate the creation of the smaller homes that consumers demand. 

In many places, including most of New Hampshire, it’s literally illegal for builders to construct a home on a lot smaller than an acre.

Minimum lot sizes that exceed basic public health and safety standards artificially reduce the supply of housing, drive up home prices, separate families by forcing the elderly and young to move out of town, worsen sprawl and traffic congestion, and encourage overdevelopment by forcing builders to develop much larger footprints to house people who could live comfortably on smaller lots.

Smaller lots allow for smaller, more affordable homes. Municipalities have shown that if they have the power to use minimum lot sizes to prohibit small homes on small lots, they will. The abuse of this power has created numerous economic problems for New Hampshire and has helped to put the classic American starter home out of reach of young Granite Staters. 

If the state wants to prevent these abuses from continuing, the quickest option is to limit the power of local governments to commit them.

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The first four housing reform bills of 2025

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New Hampshire’s housing shortage, and the price spike that it created, has made housing the No. 1 problem facing the state, according to University of New Hampshire polling. Fixing the state’s housing shortage is such a priority for voters that a 2024 UNH poll found more than 1/3 of voters rating it as the top problem, with the No. 2 problem a full 29 points behind. In response, the state House of Representatives has created a standing Committee on Housing to deal with the issue. 

Of the 22 bills referred to the committee, four have been reported out and face a full House vote on Feb. 6. The Josiah Bartlett Center for Public Policy will analyze all 22 bills during this legislative session. Below is our brief analysis of the first four bills to be released for House consideration.

  • House Bill 60, an act relative to the termination of tenancy at the expiration of the tenancy or lease term.

Under current state law (RSA 540:2), a landlord may not terminate a tenant’s lease, even at the lease’s expiration, without cause. The statute lists several causes, including non-payment of rent, substantial property damage, failure to comply with a material term of the lease, behavior that risks health or safety, refusal to vacate for lead paint abatement, or “other good cause.” 

In effect, RSA 540:2 nullifies the time limits on all residential rental contracts. Instead of a one-year lease, the law locks both parties into a permanent lease that can be broken only by bad behavior on the part of the tenant or some other “good cause” that exists outside the terms of the lease and that neither party can predict. 

A lease is a short-term contract in which both parties agree to abide by all stated provisions between the start and end dates. By nullifying the end date of residential leases, RSA 540:2 transfers the use of one person’s private property to another indefinitely, then creates a very limited set of conditions under which the owner can reclaim the use of that property.

This discourages the creation of additional rental housing, particularly duplexes and triplexes. Though the law is a problem for all owners of rental property, it’s particularly tough on individuals and families interested in investing in small-scale rental property. Owners and potential owners of smaller properties that could be put on the market to increase the state’s severely low rental supply are correctly wary of leasing their homes or small investment properties for fear of becoming locked into permanent leases. 

HB 60 fixes this problem simply by recognizing as legally binding the end dates of residential leases. This is a restoration of private property rights that encourage investment in additional rental units.  

  • House Bill 399, establishing a commission to study the New Hampshire zoning enabling act.

HB 399 is probably the most important housing reform legislation of 2025. It establishes “a commission to study the historical evolution of New Hampshire’s zoning enabling act, currently codified at RSA 674:16. The legislative intent is to study the evolution of the New Hampshire Zoning Enabling Act as it turns 100 this year. The goal is to see how the New Hampshire Zoning Enabling Act has changed over time and to consider and make recommendations for future legislation on the balance of zoning powers between the state and municipalities.”

Among the commission’s tasks is to determine whether “the listed powers are still appropriate and/or applicable today, and if any could be removed or if any not present should be added.”

It also would be charged with examining whether the listed purposes of statute that creates local zoning powers are still appropriate or whether any could be removed, and identifying any alternatives to the zoning enabling act.

The Standard State Zoning Enabling Act dates from 1925, and it’s clear that during the last half of its existence, at least, municipalities have used its powers for purposes not strictly aligned with its core purposes of protecting public health or safety and the general welfare. 

The web of regulations spawned by the act has throttled economic growth and left New Hampshire poorer and less vibrant than it would be if not for misguided government interventions, particularly in the housing market. 

The complexity of the problem is a big reason why so little progress has been made despite overwhelming public demand for change. Rather than continue to address each discrete issue one at a time, HB 399 would authorize a comprehensive review, one that is long overdue. A top-to-bottom study of how zoning contributed to the state’s housing crisis, along with recommendations for how to untangle the regulatory web, is likely the only way to achieve comprehensive reform. 

  • House Bill 444, an act relative to a tenant’s right to notification prior to the sale of a multi-family home.

HB 444 would forbid owners of restricted multi-family residential property from closing a final sale or transfer of the property without first giving “60 days’ notice and the opportunity to make an offer to each tenant in the same manner and according to the same procedures required of a manufactured housing park owner in RSA 205-A:21.” 

In short, owners of apartment buildings with five or more units, and owners of more than three single-family rental homes, would be prohibited from selling their rental properties without first giving every renter two months in which to make a purchase offer. 

Owners of mobile home parks face the same restriction under RSA 205-A:21. But there’s a huge difference between apartment renters and mobile home park residents. Mobile home park residents own their homes. They typically rent the land. And they often have associations through which they handle property rental issues. 

RSA 205-A:21 is designed to regulate property sales that involve multiple property owners. That’s not the case with apartment renters. Applying the regulations governing mobile home park sales to apartment building sales would only create confusion and delay. Unlike mobile home owners, renters do not have collective associations, do not have a long-term financial investment in the property, and typically do not have the financial resources to purchase even a small home, much less an apartment building.

HB 444 does not fix any of the regulatory problems that contribute to New Hampshire’s housing shortage, but instead would create another one. 

  • House Bill 623, relative to prohibiting corporations from purchasing single-family homes for a certain amount of time.

It’s not clear what problem HB 623 is trying to address. Institutional investors are not heavily engaged in the single-family home rental market in New Hampshire. In fact, a General Accounting Office study in 2023 found that institutional investors accounted for only 3% of the national single-family home rental market, predominantly in the South, Midwest and West. 

That study concluded that the huge and sudden increase in institutional investor purchases of single-family homes was driven by the 2007-09 financial crisis and federal policies that followed it.

Fannie Mae’s 2012 REO-to-Rental Initiative bulk auctioned thousands of single-family homes for the purpose of converting these homes to rentals. In 2017, “Fannie Mae backed a 10-year, $1 billion loan to Invitation Homes (one of the largest investors in single-family rental housing) to purchase and manage single-family rental homes,” the GAO report explained. “Freddie Mac subsequently launched a pilot program designed to provide liquidity and stability for mid-sized investors (generally those with 50–2,000 properties) and uniform credit standards on loans for single-family rental properties.”

Rather than emerging as a predator, institutional investors answered the federal government’s call to rapidly increase the supply of rental homes by buying and converting foreclosed properties. They later moved into building their own rental homes, expanding the nation’s supply of rental housing. 

The GAO report found that the rental homes run by institutional investors are concentrated in the South and Midwest, with some presence in the West, all areas hit hardest by large-scale home foreclosures following the financial crisis. Most New Hampshire homes owned by businesses “can be attributed to individuals or small investors using an LLC to buy the home,” according to the New Hampshire Association of Realtors. 

There simply isn’t a problem with institutional investors buying up homes in New Hampshire. So HB 623 offers a solution to a problem that doesn’t exist. Yet its passage could still harm New Hampshire. The bill prohibits the purchase of single-family homes by “non-natural persons” (businesses) “until the property has been on the market for 90 days.” It contains a few exceptions. The first allows the purchase of residential housing by businesses for the purpose of converting it to a non-residential use. This, perversely, would encourage businesses to remove existing stock from the state’s housing inventory. 

Like HB 444, not only does HB 623 address a non-existent problem, but it would create a real one. 

Download this policy brief here: First Four Housing Reform Bills 2025.

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On housing, Granite Staters want more development, less gov’t interference

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On housing, a consensus has settled in among Granite State voters. It can be summarized in four main points:

  1. New Hampshire desperately needs more housing.
  2. Local governments should lift regulatory barriers to the construction of new housing.
  3. The state government should act to prompt local regulatory changes.
  4. Multifamily housing is acceptable in suburbs and rural areas.

The St. Anselm College Center for Ethics in Society has polled New Hampshire voters on housing since 2020. The 2024 poll, released this week, shows that voters’ views have solidified into a strongly pro-construction, anti-regulatory, pro multi-family majority. 

A supermajority (75%) agrees with the statement, “my community needs more affordable housing to be built.” 

Roughly 60% (59%-62%) welcome the construction of affordable housing in their own neighborhoods, the relaxation of local land use regulations to allow that construction, the building of multifamily housing in suburban and rural zones, and state intervention to make all of this happen. 

In the 2020 poll, just 28.7% agreed that local governments should relax their planning and zoning regulations to allow the construction of more housing. 

In the spring of 2021, the poll found a 10% increase, to 39%, of voters saying local governments should relax planning and zoning regulations. 

In the fall of 2021, the Josiah Bartlett Center for Public Policy released our landmark study showing that local land use regulations were the primary cause of the state’s housing shortage.

The next year, the percentage of N.H. voters who agreed that local planning and zoning regulations should be relaxed to allow for more housing shot up to 52%. It now stands at 61%.

High-profile conversations about specific policy problems matter. By 2021, Granite Staters were becoming more receptive to the idea that local land use regulations were a problem. A push by the Bartlett Center and others to identify the root cause of the housing shortage and propose solutions helped more people understand the problem and demand the right fix, rather than continue to falsely blame developers or the market.

Today, a strong majority of voters understands the problem and demands that it be fixed. Yet local voters and boards have not gotten the message. 

A few recent examples:

“Hampton Falls rejects proposed 88-unit condo project on Route 1”

“Owner: McIntyre building still a parking lot due to Portsmouth zoning rules”

“Stratham select board sues town zoning board over 59-unit condo approval”

“Exeter 120-plus apartment project faces opposition”

“Portsmouth board rejects plan to raze 1900-era home for four new houses”

“Board nixes variance for North Newport senior housing project.”

New residential developments are being approved in New Hampshire. But boards continue to reject housing proposals simply because pre-existing regulations don’t allow the type of housing the market now demands. 

In the Hampton Falls and Stratham stories linked above, boards rejected variance requests because members didn’t want to contradict old, outdated rules.

In the Newport example, the rural zone doesn’t allow multifamily housing. Since the developer could conceivably propose a different use for the property than its highest, best, most in-demand use (multifamily housing), the board rejected the proposal. 

Though Granite Staters now say overwhelmingly that they welcome multi-family housing in suburban and rural zones, local boards continue to reject such proposals simply because old rules don’t allow them.

This discrepancy between voter and market demand on one side and inflexible regulations on the other cannot continue indefinitely.

The Center for Ethics in Society polling shows that on questions of housing, large majorities of New Hampshire voters are on the side of developers, not local regulators. And they want the state to act if local governments won’t. 

Voters say housing is the “most important problem facing New Hampshire,” the UNH Survey Center found last month. Thirty-six percent of voters named housing as the state’s top problem. In second place was education, with only 7% of voters naming it the top problem. 

In the most recent legislative session, the House Education Committee dealt with 156 bills. 

The number of bills referred to the Special Committee on Housing? Nine.

Housing beats education as the top concern of voters by 29 percentage points. But legislators, like local land use boards, are operating on outdated beliefs. They’ve yet to adapt to the changing voter preferences. 

But there’s an election this fall, and we’re already seeing candidates campaign on pro-housing agendas. 

Given the firmly solidified pro-housing position of most voters, hardened each month by news of rising home prices, and the slow pace of change at the local level, it would be political malpractice for lawmakers not to make significant regulatory reform a top priority next year.

For years, we’ve predicted exactly this development. The slow pace of change at the local level has voters turning to the state for solutions. So far, legislators have been reluctant to act. That won’t be the case much longer. The pressure to act is too great.

It’s a safe bet that we’ll see a significant increase in legislative proposals to address the housing shortage in 2025. People are tired of waiting for government to get out of the way and let developers solve the housing shortage government created in the first place. 

 

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On housing, New Hampshire’s No. 1 issue, 2024 offers few big reforms

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With a growing housing shortage and skyrocketing home prices as a result, the issue of housing is top of mind for Granite Staters. A June UNH Survey Center poll found that Granite Staters overwhelmingly say housing is the most important problem facing the state.

Unsurprisingly, the issue was also a top priority for legislators in 2024. And although some of the more ambitious pro-housing proposals didn’t make it through both houses, the Legislature passed a handful of modest reforms to free up the housing stock in New Hampshire.

The following are the five bills that passed both the House and the Senate and either await Gov. Sununu’s signature or have already received it:

* House Bill 1065: “relative to fire sprinkler requirements in residential buildings.”

* House Bill 1202: “relative to the issuance of permits for the alteration of driveways exiting onto public ways and relative to the definition of disability or special needs under the child care scholarship program.”

* House Bill 1359: “relative to appeals of certain zoning decisions by abutters.”

* House Bill 1361 (signed into law): “relative to municipal land use regulation for manufactured housing and subdivisions.”

* House Bill 1400: “relative to residential parking spaces, landlord-tenant law, unauthorized occupant evictions, and zoning procedures concerning residential housing.”

HB 1065 adds an exception to the state fire code for certain multifamily buildings. Under current law, existing multifamily structures consisting of more than two dwelling units must have a fire suppression or sprinkler system installed on the property. HB 1065 exempts existing buildings of no more than four dwelling units from this requirement unless fire sprinklers already exist on the property or are required by a nonresidential occupancy.

HB 1065 also prevents local jurisdictions from imposing stricter rules and regulations than the state fire code relative to residential sprinkler systems.

Requiring three-family and four-family buildings to have fire suppression or sprinkler systems can disincentivize developers and property owners from converting two-family buildings to four-families because of the prohibitive costs of installing them.

HB 1202 streamlines local permitting of driveways. Under this bill, a municipality must issue a driveway permit for a proposed driveway on residential land, including for multifamily use, within 60 days of the property owner’s application, putting an end to drawn-out permitting processes and preventing municipalities from wasting property owners’ time with delays.

HB 1359 limits who exactly can appeal local land-use board decisions by adding to the definition of “abutter.” Vexatious appeals of local zoning boards’ land-use decisions hinder residential development. Under current law, “any person whose property is located in New Hampshire and adjoins or is directly across the street or stream from the land under consideration by the local land use board” can appeal the permitted use in question to the local zoning board.

Under HB 1359, an abutter is “any person whose property is located in New Hampshire and adjoins or is directly across the street or stream from the land under consideration by the local land use board. ‘Directly across the street or stream’ shall be determined by lines drawn perpendicular from all pairs of corner boundaries along the street or stream of the applicant to pairs of projected points on any property boundary across the street or stream that intersect these perpendicular lines. Any property that lies along the street or stream between each pair of projected points, or is within 50 feet of any projected point shall be considered an abutter.”

In other words, not just anyone can claim to be an abutter and therefore appeal their local zoning board’s land-use decisions. Someone must be close enough to the land under consideration, and therefore have a claim to be materially affected by the permitted use, to have a right to appeal.

HB 1400, focusing on parking space requirements and unauthorized occupancies, was one of the more high-profile housing bills of the year. Originally, the bill prevented municipalities from requiring more than one residential parking space per housing unit. Under the version passed by both chambers, the bill prevents municipalities from requiring more than 1.5 spaces per unit for studio and one-bedroom apartments under 1,000 square feet, as well as for multifamily structures of 10 units or more.

Local parking requirements are often burdensome for housing developers and owners of multifamily properties to overcome because of all the land that needs to be accounted for and set aside to accommodate them. While 1.5 is not as ambitious as one, and owners of multifamily structures consisting of two to nine units will still have to abide by the whims local governments requiring two or sometimes more parking spaces per unit, 1.5 at least gives owners and developers of large housing complexes the breathing room to build without worrying about overcoming overly stringent parking edicts.

HB 1400 also allows municipalities to grant community revitalization tax relief for properties that are converted from office, commercial or industrial use to residential. This would let municipalities temporarily freeze property taxes on a building that is converted to residential use, thereby encouraging owners to make those conversions.

Sometimes local boards recommend changes to land-use regulations that would facilitate more housing development, only to see those changes rejected by voters. HB 1400 offers a remedy for this too. It would allow non-charter towns, village districts and counties that have unincorporated land to ask voters for permission to let the local governing body approve zoning changes without submitting the proposed changes to voters. If approved by voters, the local governing body would be able to change zoning laws or maps by majority vote.

Finally, after an amendment added by the Senate, HB 1400 outlaws squatting in New Hampshire. A “squatter” is someone who lives on another person’s property without that owner’s permission and without any legal claim or title to that property.

With the following language, “No person or legal entity, that is not a tenant, subtenant, or implied tenant, as defined in RSA 540-A:1, II, shall occupy residential real estate without permission of the owner, landlord, or their agent,” claims of “squatter’s rights” will have no legal basis in the Granite State under HB 1400, restoring to property owners the right to control who occupies their private property.

HB 1361, which has already been signed into law, forbids municipalities from banning manufactured housing. Prefabricated homes that are transported to sites, manufactured housing is an easy, quick and often inexpensive way to put more people into homes. Under HB 1361, municipalities can still regulate manufactured housing but not to the extent that it is effectively banned.

Each of these five bills, through exemptions, increased freedom, and/or regulatory reform, enhances property rights, reduces barriers to development, and makes it easier for Granite Staters to build more housing.

“The Legislature did a number of small things to ease the housing shortage, all of which had to do with giving people a little bit more freedom to use their land,” Jason Sorens, senior research fellow at the American Institute for Economic Research, said. “The most impactful reform might be letting residential developers propose alternative parking plans if the minimum requirement can be met through transit, on-street parking, or other options. But the session was also a missed opportunity in that the Senate killed more significant parking reform and by-right ADUs. Next year, they will need to get back to work on the problem.”

Among the more ambitious pro-housing bills that didn’t make it to the governor’s desk were HB 1215, HB 1291 and HB 1399. These bills represented attempts to extend the amount of time new developments are protected from local regulatory changes, allow property owners to add an additional accessory dwelling unit by right, and limit municipal restrictions on homeowners in urban residential zones who want to convert a single-family home to a duplex.

While these more far-reaching reforms didn’t make it through the Legislature, those that did represent an important first step in expanding private property rights throughout New Hampshire and reducing regulatory roadblocks to housing development.

Granite Staters want more housing, and they want enough of it to drive prices down. Whether they want it faster than legislators and local regulators have been willing to provide it is a question that might be answered only by future elections.

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Senate takes a stand on squatting

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When the House passed House Bill 1400, the bill prevented municipalities from requiring more than one residential parking space per housing unit in their local zoning regulations.

Requiring 1.5 or two parking spaces per unit, as many zoning districts do, is often a prohibitive hurdle for housing developers and owners of multifamily properties to overcome, as every duplex, three-family, and four-family structure in the zone needs to have enough land set aside within its lot for as many as four, six, and eight parking spaces, respectively. As a result, many property owners and developers may determine the juice isn’t worth the squeeze and decide against building a multifamily structure that must accommodate all those spaces.

Originally, HB 1400 would have restored to property owners the authority to decide for themselves whether a unit needs more than one parking space on site. As amended by the Senate, however, the bill allows two parking spaces per unit, double the original bill’s limit.

But while the Senate was less ambitious in protecting Granite Staters’ property rights with respect to parking requirements, the upper body added a separate property protection, this one for victims of squatting.

The Senate’s version of HB 1400 first defines “tenant,” “subtenant,” “implied tenant,” and “non-rental owner” as each is most commonly understood. Then, the bill does away with what are commonly known as “squatter’s rights.”

“No person or legal entity, that is not a tenant, subtenant, or implied tenant, as defined in RSA 540-A:1, II, shall occupy residential real estate without permission of the owner, landlord, or their agent,” HB 1400 states. In other words, unless you have the express permission of the property owner through a written agreement or otherwise, then you do not have a right to live on their property.

And that includes being able to claim squatter’s rights.

As defined by Pacific Legal Foundation (PLF), “‘Squatting’ describes moving into a property without any legal claim or title to the property. Such a person is ‘squatting’—living on—someone else’s property without consent from the owner.”

Although the terms are often used interchangeably, squatting in the modern sense is not the same thing as what is traditionally called adverse possession. Under common law, adverse possession occurs when someone wants to lay claim to a property that appears to be abandoned, per PLF. To do so, the person would normally have to show clear possession of the property, start paying property taxes, and get approval from a court to be the new owner of the property.

This common-law understanding of adverse possession would not protect present-day squatting for the simple reason that the properties being occupied by trespassers are not abandoned, let alone the fact that squatters aren’t paying property taxes or going before judges.

The issue of squatting came to a head recently in the state of New York after a series of squatting incidents, including one in which the actual homeowner was put under arrest, led state lawmakers to strip squatters of any tenant protections.

Before these changes, unwelcome guests in New York City could claim squatter’s rights after occupying someone else’s property for 30 days, thereby making it very difficult for the owner to kick them out.

While nothing that extreme has been reported in New Hampshire, squatters can make a legal claim of adverse possession of a property provided they’ve occupied the premises for 20 consecutive years under current state law (RSA 508:2).

HB 1400 would effectively nullify any claim to squatter’s rights in the Granite State if the squatter doesn’t have the homeowner’s permission to live there.

Additionally, HB 1400 would provide enhanced processes for landlords, tenants and non-rental owners to seek relief for unauthorized occupancies on their property. Anyone who claims to be a subtenant or an implied tenant would bear the burden of proof for such a claim.

Laws upholding squatter’s rights—the rights of unwelcome guests to stake a claim on a property they’ve occupied for some amount of time without the owner’s permission—are antithetical to a respect for private property rights. And securing private property rights is paramount to a free society predicated on individual rights and liberties.

The right to private property necessarily includes the right to control who occupies that land. The Senate’s amendments to HB 1400 would make it clear that that power belongs to Granite State property owners.

The House did not concur with the Senate’s changes, so HB 1400 has been sent to a committee of conference to hammer out the differences between the two bodies.

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Surprise: when housing supply meets demand, prices stabilize

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Though a housing shortage amid rising demand continues to push prices up in most of the country, some cities in Florida and Texas are seeing housing prices fall. How? They’ve built a lot more housing, The Wall Street Journal reports.

In most of the U.S., the limited number of homes for sale is pushing prices back toward record highs. Sale prices for single-family existing homes rose in 93% of U.S. metro areas during the first quarter, according to the National Association of Realtors. The median single-family existing-home price grew 5% from a year ago to $389,400.

Yet the market is cooling and prices have started falling in some cities in Florida and Texas, where robust home-building activity in recent years has helped boost the number of homes for sale. The two states accounted for more than a quarter of all single-family residential building permits every year from 2019 to 2023, according to Census Bureau data.

In 10 Texas and Florida metro areas, the inventory of homes for sale in April exceeded typical prepandemic levels for this time of year, according to Realtor.com. In eight of those markets, pending sales in April fell from a year earlier.

In Florida and Texas, “we’re starting to get into a buyer’s market,” said Rick Palacios Jr., director of research at John Burns Research & Consulting.

Only five of the 50 biggest markets posted year-over-year price declines in March, according to data provider Intercontinental Exchange, and four of them were in Texas or Florida: Austin, Texas; North Port, Fla.; Cape Coral, Fla.; and San Antonio.

In Portsmouth and Manchester, where new rental construction has accelerated in recent years, bringing thousands of new units onto the market, prices remain stubbornly high. Some policymakers and observers have suggested that this disproves the idea that adding more supply will lower prices. It does not. New Hampshire’s supply remains tens of thousands of units short of demand. For prices to stabilize, supply will have to approach demand, which will take decades at the current pace of construction.

Stabilizing home prices by letting the market bring supply in line with demand cannot be done overnight. It’s a years-long process. But Florida and Texas show that it can be done.

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Housing bills seek to restore some limited property rights while maintaining local control

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There’s a growing consensus that New Hampshire’s overly restrictive land-use regulations need to be addressed to reverse the state’s housing shortage. Whether changes should be made at the state or local level, though, remains a major point of contention.

State-level solutions generate reflexive opposition from people who view local land-use regulation as an entirely local issue. Yet some of this opposition, maybe most, is based on an important misconception.

Opponents of state action commonly assert that bills to address the housing shortage are an effort by legislators to take for themselves powers that belong at the local level. This is mistaken. 

Decisions about land use will continue to be made locally. Under many of the bills working their way through the Legislature this session, those decisions will be made by individuals at the local level rather than by local governments—boards and bureaucrats—or voters.

Changes in Manchester

Realizing the desperate need for housing, some local governments are changing their ordinances to allow more development. In Manchester, for example, several proposed amendments to the city’s zoning ordinance would represent small but important steps to relax land-use regulations in the Queen City. 

The amendments would permit four-unit housing to be built on lots currently zoned for three-unit housing, drop the required number of parking spaces for multifamily housing from 1.5 spaces per unit to one space per unit, and no longer require property owners to petition the city’s planning board for a conditional use permit before building accessory dwelling units (ADUs).

These steps are the beginning of a bigger set of reforms being studied in the city. Not every municipality is moving in this direction, though, prompting state lawmakers to intervene in limited but meaningful ways. 

But these interventions don’t amount to the creation of statewide zoning. They just return some decision-making authority to property owners, from whom it was taken in the first place.

Legislation to restore limited rights to property owners

Consider the following bills: allowing one ADU, attached or detached, by right and allowing up to two per lot under certain conditions (HB 1291), forbidding municipalities from banning manufactured housing (HB 1361), allowing the expansion of a single-family residence within an urban residential zone to no more than two residential units without review if it meets certain requirements (HB 1399), and preventing local zoning regulations from requiring more than one residential parking space per unit (HB 1400).

Yes, these would be state laws, albeit modest ones. No, they would not amount to a uniform state zoning code. They would restore some limited rights to property owners while retaining local authority to regulate in each of these areas.

Currently, if a property owner wants to add a second ADU or convert a single-family home into a duplex within an urban residential zoning district—even if the developments wouldn’t encroach on neighboring property, disturb anyone, or change the outward appearance of the property whatsoever—local ordinances can prohibit them from doing so. 

Contrary to popular belief, local governments do not hold that power by right. The power to regulate private property is, under New Hampshire’s Constitution, granted to local governments by the state. 

With each of the bills above, lawmakers are not proposing to impose a single uniform ordinance statewide. They are proposing to reduce the regulation of property in these very limited areas altogether, thus restoring a small measure of rights originally held by property owners. 

Manufactured housing—prefabricated homes that are transported to sites—is an easy, quick, and often inexpensive way to put more people into homes. Under HB 1361, municipalities can still regulate manufactured housing but not to the extent that it is effectively banned. 

Parking space requirements are a pernicious roadblock to creating more multifamily housing. In zoning districts that require 1.5 parking spaces per housing unit, that means every duplex, three-family, and four-family building needs enough land set aside for three, 4.5, and six spaces, respectively. Where municipalities require two parking spaces per housing unit, that means every duplex, three-family, and four-family building must have four, six, and eight spaces, respectively. 

Often these stringent requirements keep a lot of multifamily housing from being created, either through development or single-family expansions. By preventing local governments from requiring more than one space per residential unit, HB 1400 would restore to property owners the authority to decide whether a unit needs more than one parking space on site. 

Because these kinds of state proposals would supersede local ordinances, they rub some the wrong way. Local control has long been a very important principle in New Hampshire.

The state’s historical adherence to local control, however, shouldn’t justify unlimited local control. Local governments are still governments, and as a result, their ordinances can be fundamentally oppressive.  

At the same time, we shouldn’t always assume that the state government overruling some local ordinances automatically represents state overreach. In the case of these four bills, such actions seek to pull back the centralized planning powers of local governments and protect Granite Staters’ property rights. 

Isn’t that what governments are instituted to do, to secure our rights? If so, then private property rights are chief among them.

When you consider that these state laws would be superseding some of the most overly restrictive local regulations that limit property rights throughout the state, and that state lawmakers have only resorted to these very modest steps because of inaction on the part of municipalities, then such proposals look less like top-down state government control and more like state government doing the bare minimum to protect Granite Staters’ property rights and address the state’s housing shortage.



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