Dubbed by some as the “Montana Miracle,” the state’s systematic overhaul of zoning regulations is an illustrative example of how states and municipalities can take a bite out of the nation’s housing crisis. A 2023 article from Planning Magazine highlights efforts by Montana’s state government to enact a comprehensive series of reforms aimed at rapidly increasing the state’s housing stock.
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Putting the pieces together
Following the pandemic, the state of Montana experienced an acute housing shortage as new residents flocked to the state. As a result of this, a number of Montana markets have seen residential vacancy rates fall to less than 1 percent. In response to this, Montana Governor Greg Gianforte issued an executive order to assemble a bipartisan housing task force. Eventually the committee came up with dozens of specific statutory changes to improve housing supply.
The first signature piece of legislation to result from the committee’s recommendation was the Montana Land Use Planning Act, which permitted communities to conduct master planning efforts. Following on the heels of the Land Use Planning Act, a $100 million revolving loan fund was established to help finance the construction of new municipal water and sewer systems for residential housing.
One interesting component of Montana’s approach to zoning reform is its focus on small-town land-use needs. When speaking about rural communities, Gianforte states that “A lot of these rural communities haven’t built a home in 40 years, so constructing them now is really difficult because there are no general contractors, there are no carpenters, there are no plumbers.”
To address this, the state has enticed modular home manufacturer Dvele to build a manufacturing plant in Butte. The reasoning behind this is to encourage more modular housing in rural communities as less in-town expertise is required to get such a project off the ground.
Building momentum for change
Montana’s land use and zoning reforms are by no means done though, as the state legislature passed another series of bills in 2025 aimed at clawing back other regulatory hindrances to housing construction. For example, House Bill 492 stipulates that any home smaller than 1,200 square feet built in Montana’s 10 largest cities will be exempt from local parking mandates. Since most condos and apartments are under 1,200 square feet in size, this means multifamily buildings will no longer have to build a particular number of off-street parking spaces.
Other laws, such as SB 532, build on previous successes. In this situation, SB 532 allows one accessory dwelling unit (ADU) by right on parcels outside of cities, which is an expansion on SB 528 that legalized ADUs within cities. ADUs are small, residential units located on the same lot as detached, single-family homes. The presence of ADUs, in what might otherwise be an exclusively single-family housing development, helps increase density and the supply of available housing stock.
As rising housing prices, coupled with the availability and affordability of property insurance, become a pressing concern for coastal communities there is increasing discussion over how to strike a balance between safety and affordability. Though not all of Montana’s reforms may be as easily transferrable to a coastal environment, they do present a number of potential options for communities to consider as part of their development practices.
Montana is not the only model for housing reform, though. Just recently the American Planning Association has produced a Housing Supply Accelerator Playbook that provides a wide array of strategies for promoting affordable housing, from land use changes to instituting new construction practices and finance reforms. The playbook also includes several case studies from municipalities all across the nation that have instituted new changes to promote additional housing.
Cities grow and thrive, in part, by being able to adapt to changing environmental and economic conditions. Changes to the regulatory framework for land use planning can be daunting to communities, but once implemented they can help provide clarity to city development goals and objectives.
Meet the author
Stephen Deal
Extension Specialist (Land Use Planning)
Stephen works with floodplain managers, building officials, city officials, scientists and Sea Grant partners to provide information and training related to flood and storm resilience. He holds a... Read more
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