For several sessions, Annapolis has wrestled with how best to respond to the
state’s lack of affordable housing.
The 2024 & 2025 legislative sessions both saw intense debate around several major bills, including: the Housing Production and Affordability Act of 2024, the Housing for Jobs Act of 2025, legislation enabling ADUs statewide (HB1466/SB981 of 2025), legislation requiring reporting of housing related data to the state (HB131 of 2024 & HB698/SB814 of 2025), among a list of other bills. The major roadblock with housing policy is not a single issue but a complex interconnected web of issues, some very directly influenced by state government but most of which is totally out of any single state’s control.
Coming out of the 2025 legislative session, House & Senate leadership were resoundingly clear that in 2026, counties must be solutions-oriented and ready to address the ongoing shortage.
Below is a broad outline of what has been termed the Build Affordably in My Back Yard (BAMBY) Act. This list of Maryland-focused solutions aims to move the needle on affordable housing development. The outline is divided into four sections that represent the biggest pain points for development: taxation & market tools, land use, tenants and landlords, and state actions.
IMPORTANT NOTE:
- This draft is approximately 80% complete, but readers should anticipate some variation when a final bill is published in January. MACo is working with members and stakeholders to fine refine what will ultimately be in a final bill.
Part I: TAXATION & MARKET TOOLS
A) PRIORITIZE PRIMARY RESIDENCES / HOMEOWNER RIGHT OF FIRST REFUSAL
Solution: Prioritizes purchasers of single-family homes who intend to use the property as their primary residence. For the first 30 days a home is on the market, sellers would be limited in who they may accept offers from, ensuring that owner-occupants have the first opportunity to buy.
Issue Being Addressed: Maryland has seen a growing trend of private corporations purchasing single-family homes to convert into long-term rentals or short-term vacation units. These practices reduce the supply of homes available to residents, limit long term wealth creation by Maryland Families, and contribute to rising housing costs.
Origin: HB751 from 2024.
B) SPECULATION TAX
Solution: Authorizes a county or municipality to establish zones within which to apply annual tax on properties zoned residential or mixed use that not being developed to meet authorized uses or densities. Revenues must be used for affordable housing, school construction, or purposes directly related to housing construction.
Issue Being Addressed: In many communities, land within designated growth areas remains undeveloped or underutilized as owners hold properties for speculative purposes. This practice constrains the supply of buildable land, drives up housing costs, and undermines local planning goals. At the same time, counties and municipalities face growing demands for affordable housing and school infrastructure without sufficient revenue tools to meet those needs.
Origin: Sitaraman & Serkin, Vanderbilt University
C) HOMEOWNER PROMOTION TAX
Solution: Authorizes counties and municipalities to levy an annual tax on residential properties not being used as a primary residence. This would apply only to owners who collectively own 20 or more units. The measure requires exemptions for units rented at affordable rates or those covered by subsidies or long-term affordability covenants. Revenues generated must be dedicated to affordable housing initiatives, school construction, or other purposes directly related to housing development.
Issue Being Addressed: Many residential properties are being used as investment holdings, second homes, or short-term rentals rather than serving as primary residences. This trend reduces the supply of housing available to full-time residents, drives up prices, and creates barriers to homeownership. Meanwhile, local governments face growing demands for affordable housing and school infrastructure without sufficient revenue tools to meet these needs.
Origin: Developed based on member feedback
D) LOCAL AUTHORITY TO ADJUST TRANSFER AND RECORDATION TAXES ON LOWER-VALUE PROPERTIES
Solution: Authorizes counties to impose transfer and recordation taxes either at a single uniform rate or through a progressive rate structure. Under this authority, progressive rates may vary based on the sales price (consideration payable) or the principal amount of debt secured. Counties must establish any progressive rate structure by ordinance or resolution, and state law sets maximum allowable rates to ensure consistency.
Issue Being Addressed: Currently, many counties apply flat transfer and recordation tax rates that place the same relative burden on modestly priced homes and high-value transactions. This uniform approach limits local governments’ ability to tailor tax policy to reflect affordability concerns or generate fairer revenues from higher-value sales. Authorizing progressive rate structures provides counties with flexibility to reduce costs for lower-priced homes while increasing revenues from more expensive transactions, creating a fairer tax system that aligns with local housing and fiscal priorities.
Origin: Developed based on member feedback
E) IMPACT FEES
*NOTE* This proposal is being developed in coordination with MBIA. Negotiations remain ongoing.
Solution: Establishes that local governments may not require the payment of impact fees until a project is complete. Local governments may require the full payment of impact fees as a per-condition before issuing a use & occupancy permit. If a project owner allows someone to move into a property before a permit is granted, the project owner will face a civil penalty of $10,000 per day.
Issue Being Addressed: Builders have identified that earlier payments of impact fees may be problematic for project financing. Moving the payment of impact fees to after a project is complete but before the issuance of a use and occupancy permit will provide financial relief to projects.
Origin: Negotiations with Maryland Building Industry Associations & concepts from draft Department of Housing & Community Development legislation.
F) REAL ESTATE COMMISSION AFFIRMATIVE DECLARATION
Solution: This applies to residential sales affordable to households at or below 60% of Area Median Income or under a locally set square footage threshold. Commissions are capped at 4% of the final sales price unless both buyer and seller sign a written declaration agreeing to a higher rate. The declaration must be signed at contract execution and retained with closing documents, using a standardized form provided by the Department of Housing and Community Development. Buyers and sellers retain full ability to negotiate commission rates.
Issue Being Addressed: High commissions can reduce affordability for lower-income buyers and create uncertainty in the transaction process. Capping commissions and requiring written acknowledgment for higher rates ensures transparency, protects buyers, and supports access to affordable homes, while maintaining flexibility for negotiated agreements.
Origin: Developed based on member feedback
Part II: LAND USE
A) LOCAL PROJECT DESIGN GUIDELINES FOR QUALIFIED PROJECTS
Solution: By July 1, 2027, each local jurisdiction must adopt project design guidelines for qualified projects, addressing elements such as parking, height, setbacks, lot area, open space, circulation, landscaping, lighting, architecture, and signage.
Issue Being Addressed: Local design guidelines provide developers with clear guidance for applications, preserve community character, and maintain control over project quality and consistency.
Origin: Developed based on member feedback.
B) FOREST CONSERVATION
Solution: Amends the Natural Resources Article §5-1602 to require qualified projects meet the same reforestation ratios as multifamily construction at a 1:4 ratio or permanent protection of 1/2 acre for each acre removed.
Issue being addressed: This provision balances development needs with environmental protection, giving local governments flexibility to approve projects while ensuring responsible forest mitigation. Developers benefit from clear, predictable rules for managing forest impacts, supporting timely project delivery.
Origin: Developed based on member feedback
C) REGULATORY CERTAINTY
*NOTE* This proposal is being developed in coordination with MBIA. Negotiations remain ongoing.
Solution: Clarifies that state and local governments must evaluate project applications on criteria in effect at the time of complete application & grants construction certainty once a project application has been approved.
Issue being addressed: Builders have identified that changes in development regulations after application submittal can be a negative factor to a projects long term viability. Clarifying that state and local governments can only evaluate project applications based on criteria in effect at the time of submittal provides a level of investment certainty needed for private markets to spur further investment.
Origin: Negotiations with Maryland Building Industry Associations & concepts from draft Department of Housing & Community Development legislation.
D) LOCAL OPTION FOR ADMINISTRATIVE LAND USE REVIEW
Solution: Upon a finding of an affordable housing shortage, authorizes local governing bodies to establish an administrative process for reviewing, approving, modifying, or denying matters typically subject to planning commission review. This process may be carried out by designated staff or officials and can apply to subdivision approvals, site plans, forest conservation, adequate public facilities, stormwater management, and related permits. Local governments retain final decision-making authority, set procedures and criteria, provide public notice, and establish appeals processes.
Issue being addressed: An administrative review option gives local governments flexibility to streamline approvals, reduce delays, and allocate resources efficiently while maintaining oversight and public input. This approach balances timely development with local control and accountability.
Origin: Developed based on member feedback
E) STATE & LOCAL GOVERNMENT HOUSING TARGETS
*NOTE* The 2031 date assumes that the targets established under the Governor’s executive order will remain in effect until the next census.
Solution: By January 1, 2031, and after each decennial census, the Governor shall establish housing production targets for the state, each county, and municipalities with zoning authority. Targets are based on data including housing demand, population growth, and infrastructure capacity. Local governments may propose alternative targets with justification. The Governor reviews and accepts, modifies, or rejects alternatives, with final determinations published online. Annual progress reports track statewide and local progress toward targets through 2045.
Issue being addressed: Housing production targets provide a data-driven framework to guide local and state planning, helping communities align development with demand while accounting for local conditions. This approach gives local governments input and flexibility, ensures accountability, and promotes timely delivery of housing to meet growth needs.
Origin: Largely based on concepts debated during the 2025 legislative session. The appeals mechanism is based on similar mechanisms established by other states.
Part III: LANDLORD-TENANT
A) BAN ON ALGORITHMIC PRICING IN RESIDENTIAL RENTAL MARKETS
Solution: Prohibit the sale or use of algorithmic devices by landlords or providers when intended to coordinate rents, occupancy, or tenancy terms across multiple properties. Use of nonpublic competitor data is banned. Devices based entirely on publicly available data, or used solely for government-supported or nonprofit affordable housing programs, are exempt. Violations are considered unfair or deceptive trade practices and may be enforced by the Attorney General.
Issue being addressed: Coordinated pricing through algorithmic tools can reduce housing affordability and harm renters. This law protects competitive markets and tenants while allowing legitimate use of public-data tools and affordable housing programs, ensuring fair and transparent rental practices.
Origin:
B) LANDLORD REGISTRY
Solution: Requires entities that own residential property in Maryland to annually file a certificate with the Department of Housing and Community Development, providing a sworn contact for public communication. The department must make this information available to local governments upon request.
Issue being addressed: Accurate ownership and contact information ensures transparency, helps local governments communicate with property owners, and supports effective administration of housing and code enforcement. Currently property owners are not required to maintain updated contact information with state and local governments.
Origin: MACo 2024 Housing Initiative Bill
C) LANDLORD-TENANT LAW STUDY COMMITTEE
Solution: Establishes a Landlord-Tenant Law Study Committee to review Maryland’s landlord-tenant laws and eviction processes, with representatives from the legislature, tenant advocacy groups, the housing industry, the judiciary, and individuals with lived eviction experience.
Issue being addressed: The committee will assess whether current laws need modernization, balance landlord and tenant interests, and ensure eviction policies support housing availability and affordability.
Origin: Vermont established a similar body in 2024.
Part IV: STATE ACTIONS
A) SCHOOL REDISTRICTING
Solution: Once a decade, require each county board of education to review and report on the capacity of school facilities.
Issue being addressed: A major barrier to development has been concerns related to school capacity. Mandated utilization reporting ensures that state and local policymakers are aware of how efficiently school facilities and resources are being used.
Origin: Developed based on member feedback
B) COMPTROLLER REPORT ON STATE TAX POLICY AND DOWNSIZING INCENTIVES
Solution: By December 31, 2027, the Comptroller shall report to the Governor and General Assembly on state tax policy changes that encourage homeowners—especially older adults and families—to downsize or move to more affordable homes.
Issue being addressed: There are certain tax tools which may be helpful in spurring further development or movement within the housing market, but the larger impact of which still remains uncertain. This study allows policymakers to revisit the impact of certain tax tools which may be a boost for housing in Maryland.
Origin: Developed based on member feedback
C) REVIEW OF STATE AGENCY PROCEDURES
Solution: All relevant state agencies must conduct a comprehensive review of their housing-related processes, regulations, and approvals to identify inefficiencies, duplicative steps, and technical or policy barriers. Agencies must propose reforms, streamline reviews—especially for qualified projects—and explore delegated authority to local governments. Each agency submits an initial report by December 31, 2027, with a consolidated public report due December 31, 2028, coordinated by the Maryland Department of Planning (MDP).
Issue being addressed: A significant delay to development is the result of inefficient state processes. This provision aims to modernize and accelerate state-level housing approvals by eliminating delays, increasing flexibility, and creating expedited pathways for priority projects, supporting more efficient housing development across Maryland.
Origin: Developed based on member feedback
D) COMPREHENSIVE REPORT ON HOUSING INFRASTRUCTURE
Solution: The Maryland Department of Planning (MDP) shall prepare and publish a comprehensive report assessing how existing and planned infrastructure—water, sewer, schools, and transportation—supports or constrains housing development across the state. The report will include coordinated analysis with state agencies, local governments, and key stakeholders, and will culminate in policy recommendations to improve planning, investment, and coordination for housing growth.
Issue being addressed: The report seeks to align infrastructure capacity with housing development needs, identify gaps or constraints, and propose actionable strategies for state and local governments to support sustainable, efficient, and equitable housing growth in Maryland.
Origin: Developed based on member feedback
This article is part of MACo’s Policy Deep Dive series, where expert policy analysts explore and explain the top county policy issues of the day. A new article is added each week – read all of MACo’s Policy Deep Dives.