By Isabel McLain & Woody Rogers

The 2026 Virginia General Assembly session will go down as one of the most memorable in recent history. While it may have received less attention, this session also delivered a series of legislative successes that provide localities with new tools to increase the supply of affordable housing. The cost of housing in any state is directly tied to its competitiveness in attracting new economic development and business expansion. Thanks to the bipartisan support of the General Assembly, the commonwealth will be better positioned to provide safe and affordable housing solutions for our future workforce and, most importantly , Virginia families.

While building new homes is important for addressing the housing shortage in our region, we must preserve the affordable housing we already have. These properties are already occupied and were built with state and federal incentives or funds. Right now, nearly 2,000 units of affordable housing inventory in the Greater Richmond region are at risk of losing their affordability status by 2040 due to expiring tax credits. Once that happens, those properties could be converted to market-rate, which could displace thousands of Richmond-area families unable to pay the higher prices. Preserving existing affordable housing also offers significant savings of public dollars: building new subsidized rental housing costs 25-40% more than preserving and rehabilitating existing housing. House Bill 4, sponsored by Sen. Bennett-Parker, gives localities a critical tool necessary to protect the affordability of these properties if they choose. Specifically, the bill allows them to exercise the right of first refusal during the sale of publicly supported multifamily rental housing with expiring affordability in the next 2 years.

Another significant piece of legislation passed this year grants localities the authority to establish full or partial property tax exemptions for nonprofit-controlled affordable housing. Previously, it was unclear whether localities had the authority from the General Assembly to exempt such properties due to the complicated ownership structures associated with affordable housing funding. Meanwhile, property taxes can place significant burdens on those providing affordable housing, leaving them with less rental income to cover costs. House Bill 854, sponsored by Del. Cousins, gives localities the option to tax these nonprofits. In the Richmond region, affordable housing properties pay around $80,000 a year in property taxes, which equals about 18% of their annual operating expenses. By providing a full or partial exemption to real estate taxes, those nonprofits will be able to save tens of thousands of dollars every year, enabling them to serve their residents better, maintain their properties, and continue building more affordable housing in our region.

House Bill 867 & Senate Bill 74, sponsored by Sen. McPike and Del. Cousins, provides localities with greater authority to establish impactful inclusionary zoning programs that have been shown to create mixed-income housing across the country. In other words, all local governments will now be able to decide exactly how they want to encourage the creation of affordable housing by offering incentives they think are most advantageous to housing developers and align best with the needs in their communities. Previously, only seven localities in Virginia were provided this flexibility.

The final piece of legislation to mention that can increase housing opportunities across the commonwealth by reducing the time it takes to approve and permit affordable housing developments. House Bill 594, sponsored by Del. Simonds, gives localities the option to authorize a special fast-track process for rezoning applications of qualifying affordable housing developments. Generally, this process for both for-profit and nonprofit developments can take a great deal of time. For example, according to the latest data, a special use permit process in the City of Richmond can take over a year. During that time, developers must pay the interest on the land they mortgaged, pay property taxes, and face rising costs of labor and materials. Those expenses can add up significantly and drive up the overall cost of the project. Those costs are eventually passed on to the buyer or renter. By empowering localities to expedite affordable housing development, this legislation can significantly reduce the costs of future homes.

As a Dillon Rule state, localities are often handcuffed from making most decisions without the expressed approval of the Virginia General Assembly. That has been true with many of the most pressing issues around affordable housing — until now. Virginia’s localities have recently been granted empowerment to pursue several housing strategies that work best for them, thanks to this new slate of legislation.

Isabel McLain (imclain@vahousingalliance.org) is the Director of Policy & Advocacy at the Virginia Housing Alliance. Woody Rogers (wrogers@pharva.com) is the Policy Director for the Partnership for Housing Affordability. 

This op-ed originally appeared in the Richmond Times-Dispatch on July 21st, 2026.