NAHB Urges Congress to Ease Regulatory Burdens to Help Housing Affordability

The best way to ease the nation's housing affordability crisis is for policymakers to eliminate excessive regulations that are preventing builders from increasing the housing supply, the National Association of Home Builders (NAHB) told Congress today.

Testifying at a congressional panel hearing focusing on housing affordability, Buddy Hughes, chairman of NAHB and a home builder and developer from Lexington, N.C., said that in order to ease housing constraints for home buyers and renters, it is imperative to eliminate excessive regulations that hinder the construction of new homes and apartments.

"Regulations account for nearly 25% of the cost of a single-family home and more than 40% of the cost of a typical apartment development," said Hughes. "The time and costs associated with complying with a multitude of government regulations can be significant for small- and medium-sized builders and ultimately limit housing supply."

Increased regulations, including overly stringent mandatory energy code requirements, are impeding the ability of builders to boost housing production. In particular, Hughes cited an April 2024 final determination by the Department of Housing and Urban Development (HUD) and the U.S. Department of Agriculture (USDA) that required new single-family and multifamily homes financed by these agencies to comply with the 2021 International Energy Conservation Code (IECC) or ASHRAE 90.1-2019, respectively. The Trump Administration has delayed the effective date for both single-family and multifamily housing until May 2026.

Mandating the use of this restrictive, costly energy code will raise housing costs while providing little energy savings for consumers. Studies have shown that building to the 2021 IECC can add as much as $31,000 to the price of a new home and that it would require up to 90 years for a home buyer to realize a payback on the added upfront cost of the home. That's not a reasonable trade-off for a new home buyer.

"NAHB urges Congress and the administration to prohibit HUD and USDA from enforcing a minimum energy standard that increases housing costs during a nationwide affordability crisis," said Hughes. "We also urge policymakers to respect state and local authority over code adoption and to reject mandates that most states have not determined are appropriate for their communities."

NAHB also cited several other problematic labor and HUD regulations as well as rules regarding Clean Water Act and Endangered Species Act permitting that all continue to add costs and ultimately limit the housing supply our nation needs.

"NAHB looks forward to working with policymakers to enact sensible regulatory reforms to help break the rising housing cost curve and allow builders to produce more attainable, affordable housing," said Hughes.