AZ SB1698

Municipalities with populations exceeding 30,000 must adopt zoning regulations allowing starter homes in at least 10 percent of new single-family residential developments larger than 10 contiguous acres, effective January 1, 2027.

Prohibits municipalities from requiring minimum lot sizes of 4,000 square feet or larger, front setbacks of 20 feet or more, rear setbacks of 10 feet or more, or combined side setbacks of 15 feet or more for starter home developments.

Prohibits municipalities from requiring rear yard patios, rear yard landscaping (excluding stormwater and water conservation requirements), or approval of interior floorplans except for building and fire code compliance.

Exempts historic districts, military airports, aviation facilities, previously approved master planned communities, and areas designated for natural land preservation from these requirements.

Defines "starter home" as a single-family detached home with a deed restriction limiting initial sale to 120 percent of area median household income or limiting occupancy for up to 15 years to households at 120 percent of area median household income.

Sunsets the law on December 31, 2035.