Housing - As introduced, enacts the "Affordable Housing and Tenant Protection Act"; allows local governments to adopt ordinances and resolutions to control rent for private residential rental units; creates the increased housing program and increased housing fund; authorizes the Tennessee housing development agency to make grants from the fund to eligible developers and first-time homebuyers to assist in gap financing and down payment assistance. - Amends TCA Title 7, Chapter 53; Title 9; Title 12; Title 13; Title 66 and Title 67.

114th Regular Session (2025-2026) Introduced by London Lamar

Bill allows Tennessee cities/counties to enact rent control and creates state grants for affordable housing development and first-time homebuyer down payments.

Passed on Second Consideration, refer to Senate State and Local Government Committee

#housing

Legislative bill overview

SB 961 enacts the "Affordable Housing and Tenant Protection Act," empowering local governments to implement rent control ordinances for private residential rentals and establishing a new state housing fund. The bill creates grant programs through the Tennessee Housing Development Agency to provide gap financing and down payment assistance to eligible developers and first-time homebuyers.

Why is this important

Housing affordability is a significant challenge for many Tennessee residents, and this bill addresses it through two mechanisms: local rent stabilization and state-level financial incentives for homeownership and development. The outcome will directly affect rental costs, homeownership accessibility, and housing development patterns across the state, while also reshaping the relationship between state and local housing policy.

Potential points of contention

Rent control effectiveness and unintended consequences: Rent control is economically contentious—supporters argue it protects tenants from displacement, while opponents contend it may reduce housing supply, discourage maintenance, and push investors away, potentially worsening long-term affordability

Local vs. state authority: The bill grants local governments significant autonomy over housing markets, which some may view as appropriate localism while others see it as creating patchwork regulations that burden property owners and complicate interstate business operations

Funding and cost: The bill establishes a new housing fund requiring dedicated revenue; questions will arise about funding mechanisms, whether it's adequately capitalized, and whether grant programs reach intended beneficiaries or become inefficient