Eight States Just Moved on Co-Living Legalization. Here's Where Yours Stands.

Issue #020 | Friday, August 21, 2026 | thecolivinginsider.com

For years, the three- or four-unrelated-person cap baked into most local zoning codes has been the quiet reason co-living stays a gray-market business in most of the country. That's changing fast, and not in just one or two states.

Iowa moved first, passing a law that eliminates local governments' ability to cap the number of unrelated people who can live together at all. Oregon, Colorado, Washington, and Hawaii followed with their own versions of what's informally being called "Golden Girls" legislation, named for the sitcom, relaxing occupancy limits for unrelated renters. Texas passed a narrower version that only applies in designated college towns like College Station, home to Texas A&M.

City-level action is moving just as fast. Seattle and Minneapolis legalized co-living directly in their zoning codes. Austin removed its roommate cap entirely. Pennsylvania's bill passed the House, though lawmakers watered it down to exclude college students, and it now sits in Senate committee with the session closing at the end of November. Not every effort is succeeding: Connecticut's version passed the Senate but died in the House earlier this year.

UPDATE: Rhode Island's ROOM Act, the bill we first covered back in Issue #001, has stalled, largely due to a change in the House speaker rather than any substantive opposition to the bill itself. Sam Hooper, government affairs director for the newly formed National Co-Living Association, told HousingWire, "We've got a few other states in the pipeline," and expects Rhode Island to reintroduce it next year.

If you're operating in one of the states or cities above, verify exactly how your version defines "co-living" or "unrelated occupants," since the definitions vary meaningfully from bill to bill and that language determines what actually applies to you. If you're not, this is a trend worth tracking for where your next market might open up, not a reason to act yet.

PadSplit, the country's largest co-living marketplace, rolled out HostGuard, an insurance program bundling coverage for property damage, evictions, general liability, and even zoning actions that limit occupancy. EmpoweredRE Insurance underwrites the coverage.

Every property added to the platform going forward carries the coverage automatically. Existing listings keep their current terms unless the host moves to a new listing. PadSplit is funding it through a 2.25% increase in member transaction fees, roughly $4 a week per member, so hosts aren't billed directly. Founder Atticus LeBlanc has pointed to Airbnb's AirCover program as the model, betting that removing liability anxiety gets more cautious property owners to actually list.

Even if you're not on PadSplit, this is worth a direct question to your own carrier. Shared-housing-specific exposure, a mid-lease dispute between housemates, or an eviction that stems from a shared-space conflict, isn't always covered cleanly under a standard landlord policy. Worth confirming rather than assuming.

Jurisdiction: Pennsylvania

What's happening: A shared housing reform bill passed the state House this session but was amended to exclude college students before passing. It's now awaiting action in a Senate committee.

Status: In committee, unresolved.

What to do: If you operate in Pennsylvania, this is worth tracking now, the legislative session closes at the end of November and there's a real chance it doesn't move before then. If you operate elsewhere, this is one more data point in the broader trend above, not an urgent action item.

The Co-Living Insider | thecolivinginsider.com | Issue #020 | Friday, August 21, 2026