Starter Homes Are at the Center of Maryland’s New Housing Strategy—Here’s Why Officials Are Worried

A new starter home law is the cornerstone of Maryland Gov. Wes Moore's housing strategy, but local officials worry the bill is too broad.

The Maryland House of Delegates Economic Matters Committee got a first read of the Starter and Silver Homes Act, a bill proffered as part of a larger package of bills aimed at reforming state laws to correct a shortage of 100,000 homes.

State officials crafted the bill to make it easy to build smaller homes, as opposed to creating urban sprawl.

The problem is the state has been underbuilding for 15 years, said Jacob Day, secretary of housing and community development. That's led to alarming demographic trends, as both young workers and older people near retirement leave the state for cheaper areas.

"The solution is building smaller and more effectively and efficiently to increase housing supply and decrease housing costs," Day said.

Only 11% of the state's residential land is zoned for high- or medium-density development, and smaller units like townhomes are further restricted with local laws.

The bill limits required minimum lot sizes to 5,000 square feet, allows townhomes where detached homes are now allowed, and trims setback and lot coverage requirements. Owners of existing lots would also be able to split their lots.

In his State of the State address Wednesday, Moore cited Maryland's recent population growth. The U.S. Census Bureau put the state of 6.26 million at a 1.4% population growth rate. It has an owner occupancy rate of 67.6% and a median home value of nearly $420,000.

"We need a housing supply that matches our aspirations," Moore said. "We cannot and we will not get there by simply capping prices and praying for the best. That is neither sustainable nor smart. The solution is simple and it is singular: We need to build."

Bill refinement

The specifics of the housing bill remain in flux. There are a few dozen proposed amendments to the bill, and the state will work through concerns with locals.

Some residents and lawmakers worry the bill would preempt local zoning preferences and remove power from local officials, Del. Jesse Pippy said. Day said the bill attempts to use land most efficiently because the bill is aimed at land already zoned for housing.

Del. Seth Howard said he thought some of the bills would "seek to usurp" local officials and limit their ability to contest in courts.

"Long-standing and historical, and basically culturally, they expect that district to stay rural, period," Howard said. "They absolutely will not tolerate their local officials being usurped."

One concern is the way the law relies on the Maryland Department of Planning's "growth tier" system that divides land by what infrastructure and planning is in place. Day said the goal is to focus development on densifying existing land, instead of preventing urban sprawl.

Del. April Rose argued that approach shuts out areas like hers, which sit in the middle of the state and are mostly rural but could allow more housing development.

"I love everything about this bill, I'd like for Carroll County to participate in it, and I just want to tell you that because of that restriction, we can't," Rose said.

Other real estate law

The state's Senate set a hearing for a complementary version of the bill. Moore pitched several other bills aimed at development near transit.

One bill aims to require local planning commissions to move up notifications on their comprehensive plan. This ensures the state can support them earlier in the process and speed the approval, said Rebecca Flora, Maryland secretary of planning.

Another bill aims to enhance options for dispute resolution with local homeowner associations. Brought forth by Del. Marvin Holmes Jr., it would add a new venue for homeowners to file complaints and creates a panel to review them. It's modeled after Montgomery County's Office of Common Ownership Communities.

A separate bill requiring mandatory insurance coverage for condominiums engendered significant comments from residents.