The NAHB reports that industry experts have become concerned about the affordability of rental housing in America, and how difficult it has become to address the problem through new construction. To that end, the National Association of Home Builders (NAHB) and the National Multifamily Housing Council (NMHC) conducted joint research to find out how much government regulation (red tape) adds to the cost of building new multifamily housing. The results show that over 90% of multifamily developers typically incur hard costs of paying fees to local jurisdictions – such as applying for zoning approval and when local governments authorize construction. However;
“…government regulation can impose costs in other ways as well. Over 90 percent of multifamily developers also incur costs of delays caused by sometimes lengthy approval processes, development standards that go beyond what would ordinarily be done, changes to building codes over the past decade, and OSHA requirements…The bottom line is that regulation imposed by all levels of government (whether local, state or federal) accounts for 32.1 percent of the cost of an average multifamily development.”
Click here to read the full report on the NAHB’s website.
