"You just don't declare a moratorium," Mayor Tony Kennon said at the March 18, 2025 council meeting where Orange Beach approved one, according to Gulf Coast Media. He said there had to be a real problem behind it, and a cure.
Eighteen months later, the city is still working on the cure. On September 1, 2026, the Orange Beach City Council voted 6-0 to extend the temporary moratoriums on certain development projects. At the same meeting it unanimously adopted a new Comprehensive Plan. The vote got little attention outside city hall. Anyone comparing Orange Beach with Gulf Shores or Perdido Key should know about it, because it governs what kind of new housing can be built here, and where.
What the Pause Covers, in the City's Own Terms
The residential moratorium applies to multi-family projects of three or more units and to subdivisions with three or more residential lots under 9,000 square feet. It started on March 18, 2025, and Ordinance 2025-1523, adopted November 18, 2025, extended it through September 30, 2026. A second moratorium, approved at the May 20, 2025 council meeting, pauses development within 15 feet of any wetlands. Gulf Coast Media reported that Kennon called it a way to understand what wetland rules would mean in practice. He also acknowledged that a permanent 15-foot restriction could intrude on property rights.
Before the September vote, Gulf Coast Media's preview reported that the proposal would carry both pauses through June 30, 2027. Under that proposal, the council could rescind either one earlier. The proposal also would have counted wetlands toward a property's density, meaning wetland acreage would factor into how many units a site could hold. The September 1 minutes, posted on the city's Council Minutes page, record the 6-0 roll call but don't state a final end date. Until the adopted ordinance text is published, June 30, 2027 is the proposed date and should be treated that way.
The exemptions matter most. The original 2025 moratorium exempted three categories: applications in the Beach Overlay District, repairs and operations on existing structures that don't add density, and projects whose paid applications reached the Planning Commission before March 11, 2025.
| Category | Status under the original 2025 moratorium |
|---|---|
| Multi-family projects of three or more units | Paused |
| Subdivisions with three or more lots under 9,000 sq ft | Paused |
| Development within 15 feet of wetlands | Paused under the separate May 2025 measure |
| Applications in the Beach Overlay District | Exempt |
| Repairs to existing structures that add no density | Exempt |
| Projects with paid applications before March 11, 2025 | Exempt |
The September extension's final text isn't published yet, so the table reflects the 2025 terms. The underlying logic holds either way. The pause targets the formats that add full-time residential density, and the 2025 terms exempted applications in the Beach Overlay District from the start.
The Sewer-Tap Math
Kennon explained the reasoning with numbers when the first moratorium passed, and those numbers make the exemption easy to follow. As Gulf Coast Media reported, Orange Beach has roughly 15,000 sewer taps. Between 9,000 and 10,000 belong to holders of business licenses, and residential properties account for about 5,000.
The business-licensed properties, in Kennon's words, generate "a higher tax source." By contrast, he said, the ad valorem taxes collected from residential properties alone are "not enough to sustain the level of services" the city provides.
"That is not a commensurate value of tax revenue compared to what we get off the beach." — Mayor Tony Kennon, as quoted by Gulf Coast Media
The city wanted to find out whether the "5,000-plus units" that could still be built within its limits would force it to either cut services or raise taxes. Kennon said the city wants neither. He described the prospect as "the possible doubling of your residential community in a very, very short period of time."
About 5,000 residential taps sit inside a system of roughly 15,000. Another 5,000-plus potential units would roughly double that residential share, and by the mayor's account residential property taxes alone don't cover the services those households use. Pausing multi-family projects and small-lot subdivisions while exempting the Beach Overlay District fits that account.
Where the Studies Point
The list of what the city set out to study is mostly about land away from the Gulf. It includes stormwater drainage, "especially on Bear Point," wetland conservation, pedestrian safety, traffic lanes on Canal Road and the bridges, wastewater capacity, emergency services, possible subdivision amendments, and parking. The moratorium also came right after the city postponed a vote on deannexing city property north of the Intracoastal Waterway, a proposal that faced two lawsuits.
The agenda for the 2026 extension gave a similar reason. It said the council needed "additional time to allow for completion of the study and to review and consider city code amendments to address concerns relating to density and impacts of development in city services and infrastructure." The Comprehensive Plan adopted September 1 is the document those amendments will build on. Its density provisions weren't available for this post, so the code changes that follow it are the next thing to watch.
Meanwhile, the Resort Side Keeps Moving
At least one major resort project has kept moving through approvals during the pause. On August 25, 2026, the council voted 5-0 to approve sign-ordinance deviations for Margaritaville. Gulf Coast Media described that vote as the last step toward the project's Amenity District. The related 7.8-acre rezoning had already received an 8-0 favorable recommendation from the Planning Commission. The resort plan calls for 354 rental units: 160 condo-hotel units, 49 traditional condos, 97 resort cottages and 48 bungalows, plus a 7-acre amenity deck. Those are planned figures, and the coverage doesn't say how the project relates to the moratorium. Still, the approvals show a large rental and resort project advancing during the same months the pause has applied to small-lot subdivisions and multi-family projects elsewhere in the city.
Access to the north side of the city has also changed. ALDOT's April 30 plan called for the new Intracoastal Waterway Bridge and SR-161 connector to open in phases on May 10 and May 13, 2026. The plan sets up a one-way, free-flow route to Canal Road, with two southbound lanes on the new bridge, two northbound lanes on the former toll bridge, and roundabouts. Canal Road traffic was on the city's original study list, so the new bridge capacity is one of the conditions the city's review will now take into account.
Reading the September Numbers With This in Mind
Baldwin REALTORS' September 2026 report, published October 10 by OBA, covers coastal ZIP codes across the region, not Orange Beach alone. It's still the most current read on the market Orange Beach competes in.
- Resort Area, September 2026: the average residential sale price was $868,897, up from $720,726 in September 2025. Closed sales fell to 173 from 187, and new listings fell to 269 from 306.
- Coastal condos, September 2026: 94 sales at an average of $829,255, up 34.73% year over year, with an average of 151 days on market.
- Coastal homes, September 2026: 81 sales at an average of $972,112, up 19.59% year over year, with an average of 108 days on market.
Average prices are rising while new listings shrink. In Orange Beach specifically, one of the main ways new full-time housing gets added has been on hold since March 2025. Under the 2025 terms, a small-lot subdivision or multi-family project outside the Beach Overlay District that wasn't filed before March 11, 2025 has to wait for the pause to lift before it can move forward. For those formats, new construction in Orange Beach comes mainly from projects that were already in the pipeline, alongside existing homes. On the condo side, the regional figures show average prices up sharply, with the longest average days on market of any category in the report.
Gulf Shores and Perdido Key buyers face the same regional numbers under different rules. The specific Orange Beach factor is a city deliberately pacing its residential growth to match its infrastructure and its tax base.
Questions That Come Up
Does the moratorium affect buying an existing home or condo? The pause applies to new development applications. Under the 2025 terms, repairs and operations on existing structures that don't increase density were exempt.
When does it end? Pre-vote reporting put the proposed end date at June 30, 2027, and the proposal let the council lift either pause earlier. The September 1 minutes confirm the 6-0 vote but not the date.
What about land buyers? The wetlands pause applies within 15 feet of wetlands, and the proposal would count wetlands toward density. On a parcel with wetlands, the number of units the land can support may depend on code amendments that haven't been written yet. Anyone weighing a parcel should confirm its status with the city's planning staff.
If you're comparing an Orange Beach address with options in Gulf Shores or Perdido Key, Shannon King Jha can help you sort out which side of the moratorium a property falls on, from pipeline status to wetlands buffers to the comps that reflect current supply. If you already own here, a home valuation based on September's regional numbers and the current rules will show you where your property stands. Request Your Home Valuation to start the conversation.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
