Housing

HB 331 amends Tennessee Code Annotated Section 13-23-121 to increase the Tennessee Housing Development Agency's (THDA) maximum bond issuance limit from $4 billion to $6 billion. This change directly enables THDA to issue more bonds for financing affordable housing loans, primarily benefiting low- and moderate-income Tennessee residents seeking below-market interest rate mortgages. The bill's key provision adjusts the statutory cap to address growing demand for these housing programs, which THDA has managed within the previous limit since 2008. The increase took effect on May 2, 2025, after receiving legislative and gubernatorial approval.

SB 1079 requires developers (called "declarants") to hold the first 10% of a condo buyer's deposit in a state-licensed escrow account until construction is complete. Developers can access these funds only if they provide a surety bond or letter of credit guaranteeing full repayment to the buyer if construction delays prevent unit delivery. Deposits exceeding 10% may be used for actual construction costs (like materials and labor), but not for salaries, commissions, or advertising. The law applies to new condo contracts signed or amended on or after July 1, 2025.

SB 480 (the "Tennessee Property Rights Protection Act") revises Tennessee housing law to protect non-blighted properties from eminent domain. It deletes the broad definition of "blighted areas" and replaces it with a property-by-property standard for "blighted property," ensuring only properties meeting specific safety/code violations (and not fixed within a reasonable time) can be targeted. Housing authorities can now acquire property without eminent domain through negotiated sales and pay above fair market value for non-blighted properties located in areas designated as blighted. These changes aim to prevent well-maintained properties from being taken while preserving housing authorities' ability to redevelop truly blighted properties. The law took effect on April 3, 2025.