NAHB Study on Multifamily Regulatory Burdens Spurs Capitol Hill Hearing

Filed in Advocacy, Codes and Standards, Multifamily by on September 5, 2018 2 Comments

regulationsA recent study by NAHB and the National Multifamily Housing Council that details how regulations account for 32% of the cost of developing new multifamily properties has caught the attention of Congress.

The report acted as the catalyst for the House Financial Services Subcommittee on Housing and Insurance to put a spotlight on the issue and hold a hearing today on regulatory burdens on multifamily housing development.

Testifying at the hearing on behalf of NAHB was Steve Lawson, chairman of The Lawson Companies based in Virginia and chairman of NAHB’s Multifamily Council. Lawson told lawmakers that overregulation of the housing industry is felt at every phase of the building process.

“It results from local, state and federal mandates,” he said. “It includes the cost of applying for zoning and subdivision approval, environmental mitigation, and permit, hook-up, impact and other government fees paid by the builder. In many cases, these projects become financially infeasible and, therefore, are not built.”

The new research shows that well over 90% of multifamily developers typically incur hard costs of fees paid to local governments, both when applying for zoning approval, and again when local jurisdictions authorize the construction of buildings. Furthermore, state and federal governments are increasingly becoming involved in the process and layering on additional levels of fees and regulations.

“Multifamily builders and developers are seeing strong demand, but there are headwinds that have impacted further development,” said Lawson. “Some developers have had difficulty getting projects off the ground due to regulatory burdens and neighborhood opposition in certain parts of the country.”

To help ease regulatory burdens and improve housing affordability, NAHB is urging policymakers to:

  • Consider the cumulative effects of regulatory requirements to determine whether a new mandate is necessary to protect the health and safety of the public, or if it is simply a means to achieve a policy goal;
  • Remove barriers to production of multifamily housing;
  • Ensure that energy codes and standard are cost-effective, affordable and have a reasonable payback period of 10 years;
  • Enact common sense updates to Davis-Bacon wage determination policies to help builders construct more affordable housing;
  • Call on the Trump administration to resolve issues related to lumber and steel tariffs, which have needlessly raised the price of building materials; and
  • Maintain and properly fund federal rental assistance and multifamily production programs to serve very low- and extremely low-income Americans.

Read the full study.

For more information, contact Jessica Hall at 800-368-5242 x8253.

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Comments (2)

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  1. John Bitely says:

    any help the HBA can give us in the developing world is appreciated. I see so much money poured down rat holes to get a development approved and built it is disgusting that the consumer has to pay all this extra money for a new home.

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