New Idaho laws target home prices to help an ‘endangered species’: 1st-time buyers

After a slow start to the session, Idaho lawmakers have muscled a set of bills aimed at spurring Idaho’s laggard housing stock into law.

Through Tuesday, Gov. Brad Little has signed three pieces of legislation to ease or lift local rules restricting remanufactured homes, accessory-dwelling units and small-lot starter homes. The new laws emerged from a suite of supply-side solutions to Idaho’s housing shortage, which cosponsor Sen. Ben Toews, R-Couer d’Alene, estimated at 44,500 homes in a March op-ed published in the Idaho Statesman.

“Personally,” Toews told the Statesman in a Feb. 13 interview, “my primary focus is to make it possible for the next generation to own a house.”

Once they take effect July 1, the laws override local rules zoning rules that Toews said created “artificial scarcity” in the housing market. The measures will:

• Require factory-built manufactured homes to be treated like traditional single- and multifamily houses. (House Bill 800)
• Lift bans on accessory-dwelling units — smaller, secondary homes attached or adjacent to a primary residence — and allow homeowners to build them by right, providing the project meets health, safety and infrastructure standards. (Senate Bill 1354)
• Remove local laws and HOA restrictions that prevent “starter-home subdivisions” — that is, dense, small-lot homes designed to sell for less than typical single-family options. The bill sets a statewide minimum lot size of 1,500 square feet while also shrinking setbacks and eliminating dimensional requirements. (Senate Bill 1352)

The suite of legislation championed by Coeur d’Alene Republicans Toews and Rep. Jordan Redman sought a free-market fix to Idaho’s skyrocketing housing costs.

The median price for a home in Idaho has more than doubled in the past 10 years, according to data from the Federal Reserve Bank of St. Louis, reaching $569,000 by the time the legislative session started in January. That’s about 119% more than you’d have paid in January 2016.

To Toews, the idea is to supply more, smaller places to live and let the market take care of the price.

“First-time homebuyers are becoming an endangered species,” he said during a March 19 debate on the starter-home bill.

“Idaho is on the leading edge of our country’s protracted housing crisis,” he added. “The reality is, we’re forcing young, working Idahoans to spend their prime wealth-building years trapped in a cycle of skyrocketing rent, pricing them out of the American dream.”

Idaho lawmakers clash on local planning

The bills found support among a diverse group of Democrats and free-market Republicans, many of whom viewed the actions as deregulation to restore property rights to landowners.

But not everyone thinks the new laws will help, or that they’re taking the right approach. Some lawmakers worried the changes won’t actually help Idahoans purchase homes at a reasonable price. Others chafed at pre-empting local rules.

Rep. Josh Wheeler, R-Ammon, worried about both. “We’re planning and zoning from the Statehouse at this point,” he said during the March 19 debate l.

Proponents like Rep. Megan Egbert, D-Boise, said cities have long had their chance to spur housing.

Egbert joined Toews and Redman on the Legislature’s 2025 Interim Committee on Land Use and Housing, which over the past year embarked on a “comprehensive review” of local land-use laws to gauge their impact on housing prices and availability, according to the resolution that created the committee.

To do it, members scoured comprehensive plans and zoning codes “to identify opportunities to reduce regulatory building costs and waiting times, and provide greater flexibility in housing development.”

The committee sparked a package of bills aimed at juicing the supply side of Idaho’s housing market — a deregulatory approach targeting zoning laws that has lately found rare bipartisan support at the Capitol, if not in city halls across the state.

Some proposals stalled, like one plan to eliminate certain restrictions on duplexes and another to allow housing developments on church-owned land. Others, Egbert said, found surprising consensus.

“Zoning laws in the United States were created to divide us — they always have been, whether it’s by ethnicity, by race or by class,” Egbert told the House on during debate on March 26.

“There’s power in unity,” she added, “especially if it’s around something that has been so divisive for so long.”

With that in mind, Egbert didn’t share her colleagues’ discomfort with pre-empting local laws.

“They had 130 years to demonstrate that their city is a place where anyone can start a home,” she said. “And if they haven’t done it yet, they aren’t going to.”