Whitmer to propose affordable housing tax credit during State of the State
Arpan Lobo
Detroit Free Press
Feb. 24, 2026, 5:08 a.m. ET
In an effort to spur more homebuilding in Michigan, Gov. Gretchen Whitmer will propose an affordable housing development tax credit in her eighth and final State of the State address,
according to information her office shared with the Detroit Free Press.
Housing will be a focus of Whitmer's address, slated for 7 p.m. Wednesday, Feb. 25, her office said. It's an area the governor has previously highlighted, notably calling on
homebuilders to "build baby, build" in her 2024 speech in response to a lack of housing stock in Michigan.
While specifics of the affordable housing tax credit proposal were not released, Whitmer's office said such a program could ease the regulatory burden for home builders and create
more homes for middle- and working-class families.
“Every Michigander deserves an affordable place to live in a vibrant community," Whitmer said in a statement. "In 2026, let’s make it even more efficient and less expensive to build
quality, affordable housing that meets people’s needs. Together, we can put the American dream back within reach for more Michigan families.”
Although new homes being built increased in Michigan last year, measured by a 4.7% growth in new building permits, that rate isn't fast enough to keep up with the aging housing stock
in the state and reduce the cost of housing, according to recent Free Press reporting.
Housing costs grew last year — a new single-family home last year had an average market value of $475,000, according to the Home Builders Association of Michigan. That was a
6.5% jump from 2024, the group said.
Whitmer's office also said tariffs are raising costs of materials needed to build homes and leading to higher housing costs. Since President Donald Trump returned to the White House
last year, he's levied tariffs on imported goods from a wide swath of countries.
More: Whitmer budget cuts state worker request after 'ghost employee' fight More: When does Gov. Whitmer deliver State of the State? How to watch
Michigan currently administers a Low Income Housing Tax Credit program, although that incentive was created by the federal government. Michigan would join neighboring states
like Wisconsin, Ohio, Illinois and others in having a state-level program, should Whitmer's proposal be implemented.
In order to become reality, any proposed tax credit must be approved by both chambers of the Michigan Legislature and the governor.
At the legislative level, a bipartisan group of lawmakers recently unveiled a plan of their own aimed at lowering the cost of housing. Their proposals include removing restrictions on
minimum dwelling size requirements to boost the construction of more homes smaller in size, allowing multi-unit homes in single-family residential zones, and prohibiting minimum
parking space requirements of more than one space per housing unit, among other measures. The legislation, introduced in the Michigan House, still needs to go through the
traditional debate process, but has backing from Rep. Joe Aragona, R-Clinton Township, who chairs the House Regulatory Reform Committee which is expected to take up the bills.
The governor's office points to some progress in Michigan's quest to boost its housing stock — in August, Whitmer and state officials celebrated reaching 75,000 new or rehabilitated
units, almost four years after setting that goal. Still, with housing price estimates growing, experts generally say increased housing supply helps drive down the price of buying a home.
Whitmer's office said a state-level affordable housing tax credit would lead to more homes being built in Michigan.
Along with housing, Whitmer is expected to tout other aspects of her budget proposal during the address. The budget proposal, which was presented to lawmakers by State Budget
Director Jen Flood on Feb. 11, calls for tax breaks for seniors and families with school-age children. To raise revenue to make up for those tax breaks, Whitmer has proposed raising
taxes and fees on tobacco sales, online gambling transactions and creating a digital advertising tax for online platforms like Google and Meta.
You can reach Arpan Lobo at alobo@freepress.com