Scarborough has set aside 217 permits for new homes in the fiscal year running from July 1, 2026 to June 30, 2027. The Town Council approved that number 7–0 on August 19, 2026. Of the 217, 150 go to The Downs. The town's village and residential growth zones share 25. Say you're a buyer who has found a buildable lot near a village center, or a builder's spec plan in one of those zones. The step that matters most is easy to miss. Before anyone pulls a building permit, someone has to secure a growth permit, and this year there are very few of them outside The Downs.
So new-home supply in Scarborough isn't set by builder demand or by land prices. It's set by a quota, divided by zone, and this year's split points almost every new unit toward one development.
A Quota Sits in Front of the Building Permit
Scarborough's Rate of Growth Ordinance, Chapter 413, requires one growth permit for each new dwelling unit, no matter its size or bedroom count. Permits are counted against the area where the unit will be built. The town uses three areas:
- Area 1, rural and limited growth. Zones RF, RFM, R2, R3, R4, R4A, RH and RH2. The growth permit is issued with the building permit.
- Area 2, residential growth. Zones TVC through TVC4, VR-2, VR-4, B-3, HP, RPO and TND. The growth permit comes at site plan approval or with the building permit.
- Area 3, The Downs. The CPD zone. Same timing as Area 2.
Affordable and workforce housing has its own town-wide pool. Some work needs no growth permit at all, including accessory dwelling units and the repair or replacement of an existing home. One more exemption matters to anyone holding a single lot outside a subdivision. The amended ordinance reads:
"If there are no growth permits available from the Area allocations the Code Enforcement Officer may issue up to five (5) building permits each calendar year for detached single family dwellings located on lots that are not part of a subdivision."
Five a year across the whole town is a very small backstop.
How This Year's 217 Were Divided
The 2023–2026 ordinance gave out permits in three-year blocks. FY2027 is a single year, and the August 19 council minutes show how the split changed between first reading and adoption.
| Area | 2023–26 cycle, three years | FY2027 first reading | FY2027 adopted |
|---|---|---|---|
| Area 1, rural and residential zones | 75 | 25 | 20 |
| Area 2, TVC and village zones | 210 | 70 | 25 |
| Area 3, The Downs | 400 | 125 | 150 |
| Affordable, town-wide | 100 | 24 | 22 |
| Total | 785 | 244 | 217 |
The 217 total comes from a formula. The town's planning staff calculated it by taking the 10-year average of new-home permits through 2025, leaving out affordable units, and adding 5%. That average was 206, which works out to 217. With affordable units counted, the same method gives 244, which matches the first-reading total. The Council chose the lower method. Then, within that smaller total, it moved permits out of the village zones and into The Downs.
Area 2 shows the change most clearly. During the last cycle it got 210 permits over three years, about 70 a year. This year it has 25. The final amendment moved five of those Area 2 permits to Area 1 so the approved Elmwood subdivision could proceed.
The Rural Pool Ran Out by April, Twice
Area 1 had the tightest supply even before this year. Its annual allocation was used up in April of both 2024 and 2025. As of May 22, 2026, 70 of the cycle's 75 rural permits were gone. This year the pool is 20, five fewer than the old annual figure of 25.
Timing matters. When a pool empties in spring, a lot bought in summer may wait until the next fiscal year opens on July 1 before a new house can be permitted on it, unless the lot qualifies for one of the five non-subdivision exemptions. Someone pricing a rural lot this fall is paying for land whose buildable date depends on the town's count.
The town keeps a public growth permit tracker. Its latest entries are dated September 14, 2026. At that point Area 1 had 4 permits applied for and 16 left, and Area 2 had 4 applied for and 21 left. Most of those applications are single-family homes by builders working in the Dunstan neighborhood off Stewart Drive and in Elmwood Meadows. Fall is usually slow for permit filings. The spring rush is when the pools have emptied before.
The Downs Received More Permits Than It Has Recently Used
Last cycle, Area 3 used 274 of its 400 permits. In fiscal 2026 it used none. The tracker shows all 150 of this year's Downs permits still unclaimed as of mid-September.
Large projects at The Downs are planned and financed over several years. At the council's July 15 hearing, Dan Bacon of CrossRoads Holdings told councilors that three-year allocations are essential for planning and financing development. He said the 126 permits left unused in the last cycle went unused because developers were counting on future allocations, and he asked for more permits for the coming year. A resident who spoke on August 19 questioned the fairness of shrinking Area 2 while raising the Downs allocation to 150.
The projects are lined up. Mainebiz reported in July 2026 that 700 housing units had been built at The Downs, including tiny homes, condominiums, apartments, single-family homes, with another 800 "on the drawing board." The 96 Cross Street condominiums are finished. Sturgeon Place, an affordable complex , was still described as planned. The same report lists NBT Bank, Verizon and Maine Community Bank joining Market Basket, InterMed and Café Luna in the town center.
On September 21, 2026, the Planning Board agenda included Amendment No. 7 to the Downs Town Center subdivision. Filed by M&R Holdings and LJB Engineers for CrossRoads Holdings, it would create 24 single-family lots, one multifamily lot and two mixed-use lots in the Town Center South Residential District at Innovation Way. For a buyer who wants a newly built single-family home in Scarborough this year, that filing is one of the few sources of new lots with a large permit pool behind them.
July 2027 Changes the Formula
The interim year exists because the state changed the rules. Maine's LD 1829, signed in June 2025, barred towns from using rate-of-growth ordinances to limit housing in designated growth areas. On January 7, 2026, the Scarborough Town Council unanimously passed Resolution 26-001 asking the Legislature to repeal or delay the law. The town's announcement noted that Scarborough issued 58 net building permits per 1,000 residents from 2020 to 2024.
The Legislature passed a fix instead. LD 2173 was signed April 16, 2026. It allows growth-area caps again, but only under conditions:
- The cap on new homes, not counting affordable units, must be at least 105% of the town's 10-year average.
- Permits for affordable housing must be added on top, at no less than 10% of that number.
- Allocations must be recalculated every three years.
- Within a growth area, no single project or common scheme of development can be limited to fewer than 35% of that area's permits.
Outside growth areas, towns can still set caps without those limits. Town staff say these changes take effect July 1, 2027, which is why they recommended treating FY2027 as an interim year under the existing distribution method.
The 35% rule ties directly to this year's debate. Under the new law, a single large project in a growth area can claim at least a third of that area's permits. Scarborough's November 2025 growth workshop had already flagged production-style multifamily development as a possible result of the state changes. How Scarborough rewrites Chapter 413 for July 2027 is still open, and the next round of amendments will decide how permits are split among the three areas.
Common Questions
Does an accessory dwelling unit need a growth permit in Scarborough? No. Accessory dwelling units are on the ordinance's list of exemptions, along with the repair, replacement or alteration of an existing dwelling.
Can unused permits carry over to the next year? At the July 15 hearing, a public commenter said the ordinance doesn't allow unused Area 1, 2 or 3 permits to roll over. The current ordinance text can confirm this for a specific lot.
How can I see how many permits remain in my area? The town's public tracker lists each application by address, zone and growth area, along with running totals for each pool.
If you're weighing a Scarborough lot, a spec build or a unit at The Downs, the permit count in that zone is part of what you're buying. Veronica Schneider follows the allocation tracker and Planning Board filings so buyers and investors know whether a property can be built on this year or waits for July. Schedule a consultation to review a specific lot against this year's numbers.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
