How to Streamline Housing Permitting in Arizona

1. Introduction

Home prices in Arizona are 50 percent higher now than they were in January 2020.^[1] It could be worse: Builders have kept prices in check by adding about one percent to the state’s housing stock each year, a faster rate than in 40 states.^[2] But others, including Nevada and Texas, have outshined Arizona, adding more net new homes and calming price growth somewhat. 

The rate of home production in Arizona has been slowed by an increasingly difficult approval process. Figure 1 shows that construction timelines are expanding in the western US. Interviews with Arizona practitioners suggest that the time needed to get the various permits required before construction begins has also increased, especially since the COVID-19 pandemic.

FIGURE 1. Construction timelines are on the rise

Note: Data cover the West region of the US. Single-family data are measured on the right-hand axis. Both series show total months from authorization to completion. The temporary increase in construction timelines in the late 2000s occurred in a collapsing market, as developers paused unprofitable projects. The post-2013 slowdown occurred despite rising demand.
Source: U.S. Census Bureau, “Length of Time Tables for New Residential Construction, West Region,” accessed October 6, 2025, https://www.census.gov/construction/nrc/data/time.html.

To better understand how Arizona builders and governments work together to get homes from application to occupancy, and how those systems might be improved, we interviewed 22 knowledgeable practitioners, consultants, and land use lawyers. Of these, 14 currently work in the private sector and 8 in government.^[3] Their work collectively includes large and small residential projects in urban and rural parts of the state, major cities, counties, and small towns.

In interviews, they described a permitting system that works at a big-picture level but relies too much on individuals at many points in the process. That places unrealistic burdens on officials and creates uncertainties for applicants. As one interviewee told us, “There’s no uniform timeline; it all depends on which staffer you get.” 

2. How Permitting Works in Arizona

Arizona’s homebuilding machinery works, most of the time, because new housing makes financial sense for all parties and they cooperate or compromise to solve problems. When the gears grind, it’s because the cooperation breaks down. 

Streets for water

Development, including homebuilding, funds Arizona’s economic growth. A development on farm or desert land not only pays for its internal infrastructure but also contributes to the expansion of the general-purpose surrounding infrastructure. Although many developers dislike paying the costs of these improvements, we (and many of them) recognize that some cities would shut down development if it were not a fiscal plus.

New developments can be required to improve, or pay for the improvement of, abutting roads. This policy helps transform low-traffic rural roads into larger, safer suburban arterial roadways. In some cities, that requirement is applied only to the side of the existing public roads that borders the newly developed land. The result is “scalloped streets,” which look a bit like a bodybuilder who only exercises one arm.

Less humorously, the requirement for infrastructure funding is also imposed on infill development. Rather than a proportionate fee paid by the developer for the true expansion of necessary services, this can become an opportunistic shakedown by the local government. One interviewee recounted how a large city tried to fund a substantial road expansion with fees from a small affordable housing development. In that case, communication breakdowns among government departments added more than six months to the approval timeline. 

In cities where each infrastructure contribution is negotiated, traffic studies are a key locus of the tug-of-war between city and developer. Transportation is often the most expensive form of new infrastructure necessitated by development, and the projection of “trip counts” supplies an ostensibly empirical basis for negotiation. One interviewee told us of a 3,000-page traffic study that killed a major project in his city. Lawyers averred that cities frequently make illegal exaction demands, such as funding public improvements unrelated to the development.

Despite these drawbacks, what keeps developers at the table? In part, cities’ ample water rights—new housing cannot legally be built without a 100-year proven water supply.^[4] Although some low-density development takes place in unincorporated areas that don’t have a central authority controlling water rights, it is more common for a developer and city to reach an annexation agreement.

Although this mutually beneficial trade keeps development in Arizona from coming to a halt, many steps in the process can slow it down.

A sense of entitlements

Before builders can request construction permits, they need their projects entitled. In most cases, that means getting the zoning changed. There are two common approaches: rezoning land from one type of use to another or writing a custom zoning agreement, often known as a planned area development (PAD). The entitlement process for an ordinary project takes six months to a year.

Prior to applying for a rezoning, a developer needs a clear idea of what he or she is planning to build. Before taking the plan to the public or elected officials, a developer files a pre-application with city staff, who offer technical feedback and prepare an analysis for their bosses. The most consequential changes in projects happen at this stage. Staff will inform a developer of what will and won’t be allowed, tacitly. One interviewee told us that typical feedback included being told his project could not include off-site parking and needed larger setbacks than what he had believed.

Next, state law requires that notice be given to neighbors of the proposed development area. Some cities go beyond the requirement and require developers to engage in elaborate outreach to inform and gather feedback from neighbors. The City of Phoenix, for example, requires review by the local village planning committee (VPC). Interviewees noted that these local groups are uneven in their expertise and representativeness of their communities. Frequently, Phoenix builders alter their projects to win the approval of the VPC. Even more egregiously, the Town of Gilbert puts this step in the wrong order—before the pre-application. One interviewee told us that policy results in “eating up time with constant comments from confused neighbors.”

The next step is typically a hearing before the city’s planning commission or equivalent body. The commissioners have some relevant expertise and are informed by the staff analysis. Typically, an Arizona project faces only one hearing at each step in the process, a sharp contrast to the Groundhog Day approach in coastal states such as Massachusetts, where a single hearing may run on for years.^[5] But the hearings are often quick because they are “a formality at the end of a big lobbying effort,” in the words of one interviewee. Residents, reasonably, feel cut out of the decision-making process, which only becomes clear near its conclusion.

Custom zoning is a great tool for unique projects, but it is increasingly used instead of rezoning in Arizona and other states for routine subdivisions and mixed-use buildings. Cities sometimes require PADs because they can use the custom approval process to exert influence over design details. Developers accept them because they can offer greater flexibility—or because they face a Hobson’s choice. Some interviewees estimated that PADs are now more common than “normal” rezonings.

PADs may seem preferable to rezoning in the short term, but their biggest downside comes later. These long documents are much more detailed and often harder to understand than traditional zoning ordinances if they are written by private developers. Homeowners can easily run afoul of a PAD by changing their house color or landscaping. And PADs give no thought to a neighborhood’s need for long-run evolution.

“It all depends on the staffer”

For many of our interviewees, the greatest frustrations with the development process occurred after entitlement, during the multifarious process of acquiring permits and passing inspections for both horizontal work (such as driveways and utilities) and vertical work (buildings). At this point, all parties have agreed that the project can and should happen—but many roadblocks arise nonetheless, often for trivial reasons.

One source of frustration that many interviewees flagged was a recent disconnect between desk and field staff, and among departments, particularly in the City of Phoenix. One said, “We end up having to submit a plan one way because we know that’s what the plan reviewers are going to require to get an approval. But then we know we’re going to have to change it when we actually get to the inspection, because the inspectors are going to require something different.”^[6] New hires in the city government came in for criticism as being too rigid and acting “by the book.” The unpredictability is costly. One builder told us, “You better have a very hefty contingency in your quote,” before describing how one may (or may not) be required to replace sidewalks with hairline cracks that may (or may not) have existed before construction. “How do you estimate that type of work?”

Our interviewees’ diagnosis of this disconnect was that the COVID-19 pandemic caused turnover and broke down the traditional internal communication, allowing city officials to drift apart. It was especially hard to train and acculturate new staff during periods of remote work. However, other cities faced the same disruption without similar consequences, so there may be other causes.

On a more positive note, Phoenix has also implemented a self-certification plan allowing professionals to certify their own compliance for relatively simple site plans, objective design reviews, and similar permits.^[7] Other cities have followed Phoenix’s lead. Interviewees thought it was a promising model for other cities and states, but it was less important than the city’s remaining internal issues. One interviewee noted that self-certification is used more often for nonresidential projects than for housing development.

Outside of Phoenix, interviewees reported many of the same issues with development permits and the power of staff over projects, although the evaluation was more balanced. One interviewee told us that “with a senior staffer you can get things through in 3–4 months; with the wrong staffer it can take 6–8 months.” One builder with experience across multiple states compared Arizona unfavorably to Texas, where construction might begin within a month.

It was implicit in a lot of interviews that city staff used to be more flexible and have become rigid and cautious in interpreting standards. One interviewee told us, “I feel like over the past 10-plus years, there's been a shift from being permissive and letting things that make sense be interpreted that way, rather than having them interpreted in the most restrictive way.” The same interviewee also blamed lawyers, who push staff toward cautious interpretations of regulatory code, and vendors, who lobby for expensive solutions that use their products.

Some interviewees, both in and out of government, alleged that staff quality is the issue: “If a building official says your building has to be sprinklered, even though it doesn’t, which happens a lot, that can be hundreds of thousands of dollars and six months.” On the other hand, the best officials are creative problem-solvers: “I could give the worst building codes to the best building official and get a good outcome.”

But some of the debate really boils down to the interpretation of vaguely worded ordinances. In Mesa, the interviewee’s project had to be redesigned because the staff and architect could not agree on what constituted an “entrance” to a building. The subjectivity of the process promotes unfairness. One builder told us that other builders “get away with murder.”

In the Tucson metropolitan area, one interviewee estimated that it takes four to nine months to obtain a building permit. The city itself is at the higher end of that range, in part because of staff turnover. In rural Arizona, many jurisdictions have “one staffer, if that,” and rely on consultants. One consultant we interviewed noted that a particular rural jurisdiction is “really big on hiring and firing consultants . . . so I’m nervous.” Although we did not speak to a builder in that jurisdiction, consultant turnover likely introduces uncertainty in standards and interpretation.

Design review

Arizona governments and builders have strong feelings about the subjective review of aesthetics, architecture, and landscaping. Although many cities have formal design reviews, interviewees told us that aesthetic debates can permeate every step in the approval process. Frequently, builders have to bring physical examples of materials for subjective evaluation.

In our interviewees’ own words:

• “I’ve seen staff hold developers up on architectural and design questions that aren’t requirements, just their personal preferences. The planning commission is better because they follow regulations and do a technical review.”
• “All of it's in the gray. There's almost nothing written down.”
• “I feel for the architects because they've gotten into the profession to expand their creativity. And now, I think 80% of their job is just getting through this bureaucratic process.”
• “It gives us no creativity.”
• “I’ll go to Mesa, I’ll have an hour-long meeting about color.”
• “Tempe has lots of thoughts about the color white.”
• “It's taking probably six months to get a design review right now. . . . City of Phoenix is actually one of the better places where it's closer to three to four.”
• “Planners are just like my HOA board which I can’t stand—trying to push their agenda and style onto everyone else. Not everything has to be brown stucco with a tiled roof!”
• “It’s the same effort to bring forward 10 units or 100 units.”
• “I have a famous example that I always use: Builder submits their roof tile schedule. Planner says, ‘No, I don't like that.’ They submit another one. They submit a third. They submit a fourth. Finally, the builder gets frustrated and resends the original one that got denied. Planner says, ‘That’s it. I love it. Let’s do that one.’”

Cities often demand “articulation” and “breaking up the massing” of multifamily buildings, based on the questionable idea that busier-looking buildings are less obtrusive. This is not a harmless error in the understanding of human sight. As one expert told us, higher costs for these structural complexities come at a cost elsewhere: “We’d have to downgrade the roofing type, so now we have a 15-year warranty versus a 30-year warranty. Our flooring is now 8-millimeter wear layer versus 12-millimeter wear layer, and it’s going to need to be replaced sooner.” 

From the city staff perspective, tighter design standards have come as a mandate from political leaders or neighbors and are a defense against low quality. One official told us, “There’s a sentiment on Council that if we're not careful, we would get the cheapest and fastest thing to build today.” We asked one official for an example of bad design. He named an apartment complex that “looks like a state prison.” But his evaluation was based on how it looked from the interstate—hardly a relevant consideration for its residents or neighbors.

3. Ongoing Reforms

Arizona legislators have already responded to concerns about the complexity and delay in residential permitting processes with several recent laws.

House Bill 2447 (2025) requires cities and towns to implement four permitting policies that had previously been optional:

1. Administratively reviewing site plans and other land plans without a public hearing.
2. Administratively reviewing objective design standards without a public hearing.
3. Allowing some initial land preparation to proceed during the application process.
4. Expediting permit reviews for applicants “with a history of compliance.”

Because the law does not take effect until January 1, 2026, its impact is not knowable at the time of writing. The reliance on local implementation means that ongoing monitoring, and technical assistance for smaller cities, are necessary. One unintended consequence to watch for is whether localities will rely to an even greater extent on PADs to maintain unaccountable, subjective control of design choices.

Senate Bill 1353 (2025) aims to address the internal communication issues that our interviewees identified. It says a municipality can ask for corrections to an application no more than twice and requires prompt informational meetings. Similarly, it tries to limit the practice of field inspectors demanding departures from a development plan approved by a municipality. It also allows developers to seek building permit approvals from a consultant (a “third party”) rather than city staff, but only after waiting 15 working days for city approval.

Lawmakers should continue to monitor all these new provisions because the road to permitting purgatory is paved with well-intentioned statutes. One need not look far afield: Arizona legislators have used a “shot clock” to try and induce prompt entitlement decisions from municipalities. It has not worked.^[8]

Senate Bill 1162 (2024) requires that municipalities determine whether a zoning application is complete within 30 days and then approve or deny it within 180 days. As with other shot clock laws, the fundamental problem is that the city can always deny the project if the deadline nears. Instead, developers will request an extension. On net, that just adds one more process (tracking and extending the timeline).

In the City of Phoenix, adding the shot clock actively worsened the entitlement process. In the city’s view, entitlement changes can only be granted conditional on a traffic impact assessment (TIA)—for which the developer has to pay. Thus, to comply with the new law, the city moved the TIA requirement to the front end of the process. According to one interviewee, that means “you need a fictitious site plan and a traffic study costing $50,000 to $75,000” just to begin the zoning process. “Then, after changes [imposed during entitlements], I have to redo the entire study.” In addition, to comply with the Supreme Court’s Nollan/Dolan proportionality test, the City of Phoenix requires that a developer’s TIA assess the maximum entitlement possible, not that developer’s specific site plan. Therefore, developers may have to pay a disproportionate traffic assessment based on a potential maximum entitlement. 

This example is a reminder that the complexity of permit processes does not lend itself to simple solutions. As long as cities have the option of simply refusing development—either through discretionary reviews or formal zoning—laws intended to tie cities’ hands may backfire. For example, many developers would gladly stop funding cities’ infrastructure expansion. But without the power to extract concessions, cities would gradually turn against development. In making the reform suggestions that follow, we have remained aware of the unintended consequences inherent in tinkering with a complex behavioral system.

4. Recommendations

To reduce uncertainty, speed up existing procedures, and give property owners clearer development rights in the long term, we recommend the following reforms.

• Streamline the entitlement and exactions process
  • Relax the shot clock.
  • Ensure that development permits proceed in a reasonable order.
  • Limit the area of study for TIAs.
  • Encourage cities to adopt presumptive traffic exaction formulas in place of repetitive traffic studies.
  • Allow a nonprofit or trade association to sue a city for multiple cases of illegal exactions.
  • Narrow the protest petition so that only people whose property is being rezoned can petition, not adjacent owners.
  • Do not allow a city to require hearings before more than two bodies.
• Reform staff review and development permit processes
  • Fund ongoing training for reviewers and inspectors.
  • Define site plan review in statute.
  • Put guardrails on published design requirements.
  • Curtail personal preference in design requirements.
• Establish long-term clarity in rights
  • Clarify property owners’ rights in PADs.
  • Allow subdivisions without homeowners associations (HOAs).
  • Affirmatively renew HOA deed restrictions.

Reforms to the entitlements and exactions process

Relax the shot clock
As noted in the previous section, the City of Phoenix responded to Arizona’s new zoning shot clock by adding procedures without noticeably shortening timeframes. As part of a package of reforms, lawmakers should continue to review whether there are ways to relax the shot clock while still streamlining the process.

Ensure that development permits proceed in a reasonable order
A number of cities put steps out of order, requiring work to be duplicated. Legislation is unlikely to get this right. Rather, city officials should reorganize their processes to align with best practices. The existence of extensive pre-application processes is a red flag: Application processes should be simple enough that formal documents need not change hands before the application.

Limit the area of study for traffic impact assessment
Lawmakers should set a limit on the linear distance or number of intersections that a traffic study or traffic-related exaction can contemplate. The limits should eliminate the most unreasonable demands for traffic-related studies and fees, but they should not affect the typical traffic study.

Encourage cities to adopt presumptive traffic exaction formulas in place of repetitive traffic studies
Many types of common projects (e.g., multifamily, retail, or general office uses) should not require a traffic study. Rather, the legislature should allow cities to establish presumptive formulaic fees depending on basic characteristics of a development—square footage, number of parking spaces, etc. To encourage this clearer, quicker approach, the state should also require that any traffic study costs incurred by a developer at the city’s behest be subtracted from the exaction required. In a city that adopts a presumptive fee formula, a developer may choose to fund a study instead.

Allow a nonprofit or trade association to sue a city for multiple cases of illegal exactions
As one interviewee said of a particular city’s development conditions, “It’s probably illegal, but nobody is going to sue over it.” Who might sue to prevent abuses? One possibility is organizations with a broad interest in housing affordability, property rights, and growth. We suggest granting these outside parties standing to sue a city if they can allege multiple instances of illegal exactions or conditions.

Narrow the protest petition
An Arizona statute allows a small minority (nominally 20 percent) of the property owners adjacent to a proposed rezoning to protest, triggering a supermajority requirement for city council approval.^[9] This protest petition appears to be used most in Scottsdale—for example, as a maneuver by one restaurant owner to stop another from opening patio dining.^[10] Arizona lawmakers can follow Montana, North Carolina, Texas, and Wisconsin in narrowing the provision so that it does not apply to adjacent property owners, only to those whose property is being rezoned.^[11]

Do not allow a city to require hearings before more than two bodies
Our interviewees singled out Phoenix for its extra round of hearings before VPCs. As other states have experienced, multiple rounds of deliberation can get out of hand. The state should cap at two the number of city bodies that can hold separate hearings on any given development. Thus, Phoenix would have to eliminate one of its current hearings or combine two of them.

The legislature could go further in this vein and allow only a single required hearing for small infill projects that do not require infrastructure extension.

Reforms to staff review and development permit processes

Fund ongoing training for reviewers and inspectors
Improving staff communication and problem-solving abilities is fundamentally a management issue, not a legislative one. Elected officials and public managers should vigorously support their staff in improving collaboration across departments and commit to protecting staffers who proactively solve problems. The legislature should consider funding training for plan reviewers and inspectors, including on legal issues.

Define site plan review in statute
Although H.B. 2447 mentions site plan reviews, Arizona statute does not fully define the concept. In practice, the term’s meaning differs across jurisdictions. The legislature should clearly and narrowly define what site plan review can cover (traffic flow, massing, etc.) and what it cannot (aesthetics, internal design, etc.). Site plan review should always be an administrative, technical review that does not rely on reviewer discretion. 

Put guardrails on published design requirements
Some Arizona cities use published design requirements, which range from vague to hyper-specific and often leave room for extensive personal preferences. Legislators could entirely ban design requirements, returning creative control to architects. Or they could place some modest guardrails, such as mandating that any design requirements be specific and objective. Another approach would be to allow each city to designate up to 15 percent of its area as “design districts” and free development elsewhere from design requirements. This would allow cities to control aesthetics in historical or showpiece districts.

Whatever approach the legislature takes, it is vital to ensure that the rules are the same whether design review is undertaken as a discrete process, folded into other reviews, or written into a PAD. If the legislature does not ban illegal requirements in PADs, they will continue to proliferate.

Curtail personal preference in design requirements
The imposition of personal preferences onto site plan review, civil engineering, and building reviews and inspections is probably illegal already. But it happens constantly. The legislature should strengthen current law and clearly state that technical reviews must be limited to technical matters and that personal (as opposed to departmental) interpretation of aesthetic matters is not permissible. 

To enforce this requirement, the legislature needs to think about consequences. It could allow applicants to demand a refund of any fees paid if they were forced to adopt an aesthetic or design choice beyond the scope of a technical review. Or it could allow a nonprofit or trade association to challenge a reviewer’s license if he or she exhibits a pattern of demanding conditions beyond the scope of the license.

Ensuring long-term clarity in rights

Clarify property owners’ rights in PADs
Although PADs can be a useful tool for development, they are unsuited to long-term regulation of developed land. As individual and market needs evolve, the specifications of the PAD become unresponsive constraints. And PADs can be difficult to find and understand: Regular owners may need to hire a lawyer simply to know their rights. Traditional zoning, for all its shortcomings, is designed to manage ongoing use.

The legislature should require that cities eventually rezone or default every PAD to an underlying zoning district so that future redevelopment can occur on individual parcels without requiring amendments to the PAD. Importantly, the new zoning must not create nonconformities—every legally permitted structure and use must remain legal. If a city fails to act, the PAD should lapse for any property 10 years after it received a certificate of occupancy, and the property should default to the most similar conforming zoning district.

Allow subdivisions without homeowners associations
Many people want to buy a house in a homeowners association (HOA), but many others do not. The law already prevents cities from requiring an HOA—but cities often require common elements in a development’s design, such as open space, which implicitly require an HOA for maintenance.^[12] Cities should encourage and enable non-HOA neighborhoods as part of their growth mix. Doing so will sometimes involve accepting parkland dedications, which are both a benefit and a cost to the city at large. 

Affirmatively renew HOA deed restrictions
In theory, deed restrictions on private land in an HOA are voluntary. In practice, they run perpetually or auto-renew, and homebuyers have few purchase options besides homes in HOAs. To restore the voluntary character of HOAs and to allow the gradual evolution of land use in future generations, the state should require that all HOA deed restrictions recorded after 2026 be written to expire automatically unless the owners vote to renew them every 30 years.^[13] 

5. Conclusion

Arizona builders continue to provide a steady flow of new houses and apartments. Their work has been an important outlet for unmet demand in California and elsewhere—but supply has still not kept pace with demand, and home prices have risen steeply in Arizona. As part of a long-term commitment to keeping homes within reach for Arizonans, cities and legislators should work together to clean the sand out of the gears and restore quick, clear processes for permitting new homes.

About the Authors

Salim Furth is a senior research fellow and director of the Urbanity project at the Mercatus Center at George Mason University. His research focuses on housing production and land use regulation. He frequently advises local governments and testifies before state and federal legislatures. He earned his PhD in economics from the University of Rochester. 

Manjula Vaz is a partner at the law firm of Gammage & Burnham in Phoenix and serves on the Management Committee. Her practice focuses on complex land use matters. She assists clients with the negotiation and implementation of development agreements, Government Property Lease Excise Tax agreements, and other land use agreements. She frequently appears before planning commissions and city councils on behalf of clients regarding land use matters. In addition, Vaz is a faculty associate in the Master of Real Estate Program at Arizona State University.

Cameron Artigue is a partner at the law firm of Gammage & Burnham in Phoenix, where he practices in the areas of land use law and real estate development. He graduated from the University of California, Berkeley School of Law, where he was a member of the California Law Review. Cameron regularly presents at various professional conferences and events and is an adjunct professor at the Sandra Day O’Connor School of Law and W. P. Carey School of Business at Arizona State University.

Notes