Arizona is making bold moves in 2025 to reshape its housing landscape, and the changes couldn’t come at a more pivotal time.
Amid surging population growth, persistent housing shortages, and rising rental demand, the state legislature has introduced two powerful pieces of legislation aimed at reducing regulatory barriers and encouraging development.
House Bill 2447 (HB2447) and House Bill 2110 (HB2110) are poised to unlock new opportunities for real estate investors, developers, and housing advocates alike.
These legislative reforms mark a turning point in Arizona’s housing policy, signaling a firm commitment to fostering more flexible zoning, streamlined development approvals, and more efficient use of urban land.
For investors and developers eyeing Arizona’s high-growth cities—like Phoenix, Mesa, and Tucson—these bills represent not just policy shifts, but a wide-open door to long-term returns and impactful growth.
Let’s break down what these new laws mean, why they matter, and how you can position yourself to benefit.
Understanding HB2447: More Approvals and Cutting Red Tape
What is HB2447?
Effective January 1, 2025, House Bill 2447 significantly reforms the development approval process across Arizona.
The legislation empowers municipal staff—not just elected city councils—to approve a range of development documents, effectively reducing bureaucratic delays and streamlining the path from concept to construction.
In a state where population growth continues to outpace housing production, HB2447 stands out as a practical, pro-growth initiative aimed at accelerating project timelines for investors, developers, and builders alike.
Key Provisions of HB2447:
- Administrative Approvals: City and municipal staff are now authorized to approve:
- Site and development plans
- Lot line adjustments, divisions, and ties
- Preliminary and final plats
- Design reviews and plat amendments
This delegation of authority speeds up approvals by avoiding long city council agendas and political bottlenecks.
- “At-Risk” Submittals: Developers may now proceed with certain preliminary infrastructure or grading work while formal approvals are still pending. This flexibility reduces downtime and enables teams to maintain momentum during permitting.
- Fast-Track Review for Compliant Developers: HB2447 also introduces faster review timelines for developers with a proven track record of compliance. This incentivizes responsible development and promotes efficiency within city planning departments.
Why It Matters for Investors:
For real estate investors, HB2447 presents a significant opportunity to acquire undervalued commercial assets and turn them into high-demand residential units. With reduced bureaucratic hurdles and strong urban demand for housing, adaptive reuse becomes not only feasible but highly profitable.
HB2110: Easing Restrictions on Multifamily Development
What is HB2110?
House Bill 2110 is a bold legislative move aimed at repurposing underutilized commercial, office, and mixed-use parcels to help address Arizona’s persistent housing shortage.
Effective immediately, HB2110 mandates that all large cities in Arizona—those with populations of 150,000 or more—must designate at least 10% of their commercial and mixed-use land as eligible for adaptive reuse or redevelopment into multifamily housing.
This initiative directly challenges restrictive local policies and offers a proactive solution to the rising demand for diverse, affordable, and attainable housing options in Arizona’s urban centers.
Key Provisions of HB2110:
- Minimum 10% Allocation: Cities must update their zoning and development ordinances to ensure that at least 10% of existing commercial, office, or mixed-use parcels can be redeveloped into multifamily residential housing.
- Overrides Local Barriers: The law nullifies restrictive municipal policies like Scottsdale’s prior 1% cap on commercial-to-residential conversions, effectively overriding anti-housing measures that have stifled development.
- Immediate Implementation: The bill is already in effect, and affected cities are under a 90-day deadline to revise local ordinances and bring their codes into compliance.
Why It Matters for Investors and Developers:
HB2110 opens the door to vast new opportunities in cities that were previously limited by exclusionary land-use policies. The mandated conversion percentage ensures that investors and developers have access to a larger, more predictable inventory of land suitable for multifamily housing projects.
For markets like Phoenix, Mesa, and Tucson, this creates an influx of viable sites for adaptive reuse and ground-up development. It also helps unlock stagnant commercial corridors that have struggled in the post-pandemic economy, repurposing them into productive housing spaces.
By preempting local resistance and forcing cities to modernize their zoning frameworks, HB2110 accelerates housing development in high-demand urban areas—and empowers investors to move forward with confidence, knowing that key parcels are no longer off-limits.
Economic and Social Impacts of HB2447 and HB2110
Unlocking Economic Growth
Together, HB2447 and HB2110 are poised to transform Arizona’s housing and development landscape. By accelerating approval timelines (HB2447) and unlocking commercial land for multifamily housing (HB2110), these bills create a more agile and investor-friendly environment—ideal for economic expansion.
For local governments and communities, these legislative shifts promise increased job creation, higher tax revenues, and more efficient land use. Developers can reduce holding costs and speed up construction, while cities benefit from revitalized neighborhoods and stronger infrastructure investment. In short, the state’s pro-growth strategy sends a clear signal to builders and investors: Arizona is open for business.
Addressing the Housing Shortage
On a social level, the impact of these bills could be profound. Arizona, like many states, faces a critical housing shortage—particularly in urban centers experiencing rapid population growth. HB2110 helps meet this demand by converting dormant commercial spaces into livable, affordable housing, while HB2447 ensures these projects aren’t delayed by excessive bureaucracy.
By supporting faster development of multifamily housing and encouraging adaptive reuse, these laws help bridge the gap between available land and housing needs. The result is greater housing accessibility for working families, young professionals, and low-to-middle-income households—groups often left behind in traditional development models.
How Real Estate Professionals Should Respond
Developers: Move Quickly and Strategically
With HB2447 going into effect on January 1, 2025, and HB2110 already in force, timing is critical. Developers should begin identifying commercial, office, and mixed-use parcels in cities with populations over 150,000 and monitor local ordinance changes closely. Parcels that were previously off-limits may now qualify for residential development—and early movers will have a distinct advantage.
Additionally, developers with strong compliance records should leverage HB2447’s fast-track review provisions to maximize efficiency. Incorporating “at-risk” submittals into project workflows could significantly cut down development timelines and reduce financing risk.
Investors: Reevaluate Your Portfolio
For real estate investors, now is the time to reassess portfolios with an eye toward long-term residential potential. Commercial assets in high-density corridors or near transit lines may now offer viable conversion opportunities under HB2110. The 10% minimum conversion mandate ensures a reliable baseline of accessible parcels, which could yield strong returns as housing demand rises.
Consider joint ventures or partnerships with experienced multifamily developers to capitalize on these opportunities. Tax incentives and public-private development agreements may also be more readily available as cities work to meet state mandates.
Brokers and Property Managers: Stay Informed and Advisory-Ready
Brokers and property managers should take on a consultative role by helping clients understand how these legislative changes affect zoning, land use, and investment strategy. Monitoring local government updates on ordinance changes is key, especially within the 90-day compliance window tied to HB2110.
Property managers in particular should prepare for an uptick in demand for multifamily housing management, especially in newly converted or adaptive reuse properties. Expertise in navigating the transition from commercial to residential use will become increasingly valuable.
Final Thoughts
Arizona’s HB2447 and HB2110 are more than just housing bills—they’re strategic responses to a fast-evolving real estate market. These legislative changes demonstrate the state's commitment to smart growth, housing accessibility, and investor-friendly environments.
Whether you’re a seasoned developer or a new investor looking to break into Arizona’s thriving real estate market, the time to act is now. These laws eliminate common barriers, offer powerful incentives, and unlock new opportunities across urban and suburban landscapes.
Looking to make the most of your investment in Phoenix? Trust the experts at RPM Phoenix Property Management. Our team offers comprehensive property management solutions—from tenant screening to maintenance coordination—that protect your assets and maximize returns.
With deep knowledge of Arizona’s evolving real estate laws, we’re the partner you need for smart, compliant, and profitable property management.
Contact us today and take advantage of Arizona’s new real estate landscape. The door is open—step through it with confidence.
Additional Resources
What to Know About Out-Of-State Rental Investments in Phoenix
