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How Do Building Codes Affect the Price of Housing?

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Briefings

This briefing examines how building codes influence housing prices in the United States, focusing on the National Association of Home Builders' analysis of the 2015 International Residential Code. Key findings indicate that construction costs, which comprise the largest share of housing expenses, are significantly affected by regulatory requirements such as snow load limits, fire safety standards, and material specifications. The study compares current code provisions against a baseline of de facto regulations like insurance mandates and professional liability requirements to isolate code-specific impacts.

Key points

• The National Association of Home Builders (NAHB) analyzes code costs by comparing current requirements against a baseline of de facto regulations like insurance and professional liability standards.
• The 2015 International Residential Code report examined single-family home construction across different regions, identifying specific code provisions that increase costs such as snow load requirements and fire safety standards.

Context

Research on building code impacts relies on the NAHB's annual reports, which analyze code changes since 2009. These reports compare current requirements against a baseline of de facto regulations like insurance and professional liability standards to isolate code-specific impacts on housing costs.

Limitations

The analysis covers the 2015 International Residential Code and its effects on single-family homes across different regions. The study relies on NAHB reports and does not include data on manufactured homes, which are governed by a separate federal building code, nor does it account for regional variations in construction costs beyond the reference houses used in the analysis.

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