Greetings on Tuesday as we unveil a fresh issue of Rent Free. 

In line with the warm, sunny spell sweeping the D.C. area this week, this edition spotlights a handful of encouraging examples of housing reform moving onto the books. They include:

• Developers racing to capitalize on California’s new law promoting apartments near transit hubs
• North Carolina’s sweeping repeal of parking minimums across the majority of the state
• The federal housing bill finally taking effect as law

Developers Rush To Use California’s New Transit-Oriented Development Law

Two weeks have passed since California’s ordinance enabling residential projects beside transit stops took effect, and demand is surging, at least in Palo Alto. 

Six endeavors leveraging Senate Bill (S.B.) 79’s more generous density caps have been filed with the Silicon Valley city, according to Palo Alto Online. 

The freshest SB 79 submission targets a 75-foot-tall, 17-unit residence replacing a nonprofit school, located mere blocks from a Caltrain station.

Because of its closeness to a commuter rail stop, the project can claim the law’s maximum density allowances under SB 79. The statute permits smaller structures to be built further from major rail hubs and adjacent to light-rail and bus stops. 

Sponsors behind the proposed project are also employing the state’s density bonus rule to trim the required parking footprint.

SB 79, passed last year, marks the culmination of the state’s YIMBY movement—“Yes In My Backyard”—a decade-long push to authorize new apartment buildings near transit. 

Estimates suggest the law could unlock as many as one million new apartments across California’s urbanized zones. 

The open question is whether SB 79 will deliver housing at a scale near that potential. 

Palo Alto’s experience offers both reasons for hope and for caution. 

On the positive side, developers rushing to file projects under SB 79 imply the zoning relief actually loosens local standards enough to make projects pencil out. The new rules appear to be meaningful relief from prior constraints.

On the other hand, the surge in filings partly reflects a race to lock projects under the more permissive rules before upcoming local amendments shrink the density caps. 

SB 79 grants localities substantial leeway in how they implement the law. They may adopt temporary measures that reduce densities while drafting longer-term alternative plans, or enact permanent schemes that reallocate capacity—trading density near transit for larger buildings elsewhere. 

As a brief from the law firm Holland & Knight observes, most major California cities are pursuing both tracks—temporary density reductions alongside more durable “alternative” approaches. 

Palo Alto mirrors this pattern. Last month, it enacted an implementing ordinance that cuts SB 79’s density allowances by half. 

According to Palo Alto Online, the ordinance becomes effective this Thursday. With the more generous state standards still in effect for a two-week window, developers have rushed to submit SB 79 applications. 

That burst of activity signals that cities can effectively curb the reach of SB 79 by leaning on implementing ordinances.

“Will there be a need for cleanup? Almost certainly,” remarks Nolan Gray, senior director of legislation and research for California YIMBY, the group behind SB 79. “Even a well-drafted law—one I’d argue is far better written than past housing measures—still requires ongoing effort to ensure faithful implementation.” 

Gray notes that numerous jurisdictions, including Sacramento, are allowing SB 79 to take full effect without local amendments. The temporary implementing ordinances are set to expire in 2032, when SB 79 reaches full operation.

Elsewhere, attempts by localities to blunt SB 79’s impact have been thwarted. San Diego planners briefly produced zoning maps that omitted upzonings around many bus stops, provoking opposition from activists and eventually being withdrawn. 

Zoning preemption at the state level is inherently a cat-and-mouse game. The premise is that localities won’t upzone on their own, but many jurisdictions deploy every available tool to restrain the state’s push to permit more housing. 

With SB 79, only time will reveal whether the state or the localities prevail in this back-and-forth.  

North Carolina Eliminates Parking Minimums Across Most of the State 

Last week, North Carolina Governor Josh Stein, a Democrat, signed a measure that ends parking minimums across the bulk of the state. 

House Bill (H.B.) 162 bars local zoning and development rules from mandating “off-street parking” with a minimum count for any project, regardless of its use or occupancy.

Starting in January, as the law takes effect, residential buildings, subdivisions, and shopping centers can be constructed without a government-imposed parking quota. Developers will decide how much parking the market requires.

“Driving past sprawling malls with vast lots that sit mostly unused except during the holiday rush made me question why we need so much vacant parking,” says Rep. Donnie Loftis (R–Gaston), one of the bill’s sponsors, to Reason.

The measure initially passed the House unanimously and faced only a single dissent in the Senate.

Even so, certain coastal counties under the Coastal Area Management Act retain the right to impose parking minimums for new projects, unless the development sits within their historic districts. 

That carve-out emerged as a compromise with local governments, intended to ensure adequate parking in coastal zones that attract a summer influx of visitors. 

Even with that exemption, North Carolina’s reform stands as the most expansive to date, says Tony Jordan of the Parking Reform Network, which advocates dismantling parking mandates. 

A tracker maintained by the Parking Reform Network shows more communities moving to scrap parking minimums entirely. 

At the state level, parking reform typically accompanies broader housing reform, Jordan notes. The result is that most enacted reforms have focused on eliminating parking requirements for housing, rather than for commercial uses.

North Carolina, by contrast, stands out for enacting standalone parking reforms that also end parking mandates for commercial uses. 

“The commercial side is probably more disruptive for city planning,” he adds. 

Federal Housing Bill Finally Becomes Law 

The 21st Century ROAD to Housing Act has finally become law this past week, without a signature from President Donald Trump. The president had ten days to either sign or veto after it arrived from the House. 

He chose not to act, resulting in automatic enactment. 

Rent Free has traced extensive coverage of the federal housing legislation, which began life in the Senate Banking Committee last summer under the ROAD to Housing name. 

While the bill’s details have evolved considerably, its final form remains a catalog of mostly modest adjustments to federal housing policy, many aimed at boosting the pace of home construction nationwide. 

A handful of these changes aim to direct federal grants toward growth-friendly outcomes. 

The legislation reallocates existing funding from the $3.3 billion Community Development Block Grant program—from jurisdictions with high housing costs and slow development to those actively expanding housing supply. 

It also establishes a $200 million per year Innovation Fund to aid planning for communities that have already adopted liberal zoning reforms. 

The bill directs the Department of Housing and Urban Development (HUD) to publish model zoning reforms and to streamline environmental reviews for federally subsidized housing projects. 

The most direct deregulation occurs in the manufactured-housing sector, with the measure repealing a federal building-code requirement that manufactured homes sit on a permanent steel chassis. 

Advocates have argued for years that this rule unnecessarily inflates the cost of affordable manufactured homes. 

The bill also imposes some new restrictions. The final version generally bars large investors in housing (defined as owners of more than 350 single-family homes) from acquiring additional single-family properties. 

This isn’t a positive provision, but it emerged from a bipartisan concern that corporate buyers are crowding out families from the single-family market. 

A silver lining is that the stricter investor limits initially proposed were far harsher and would have effectively banned build-to-rent projects—a growing sector in new construction. 

The removal of those harsh provisions amounts to a notable concession. It’s also worth noting that Congress managed to pass a housing package without a large new spending binge or the addition of sweeping tenant protections that many Democrats had pushed for. 

Discerning how effective the 21st Century ROAD to Housing Act will be remains to be seen. Many of its supply-side provisions rely on federal incentives to spur local deregulation, and past efforts have produced mixed results. 

The deregulation of manufactured housing is a more direct change and could have an immediate impact on boosting production. 

Quick Links 

• California voters will face not one but two housing-related bonds on the November ballot. One would finance the construction of affordable homes, while the other would back loans for middle-income buyers.
• Good news! The latest homeless encampment in San Francisco is actually part of a movie set.
• The Washington Post’ editorial page opposes property tax freezes for seniors.
• Following a widely publicized Airbnb squatting case, D.C. Mayor Muriel Bowser is proposing housing reforms designed to make it easier to remove short-term renters when their stay ends.
• Idaho leads the country in homebuilding.
• A new lawsuit targets Santa Rosa, California’s emergency rules on rent increases for mobile homes.