Does government regulation raise the cost of new home construction?


The National Association of Home Builders reports that “rising interest rates and high land and production costs will continue to push the cost of housing beyond the means of many American families, and a disproportionate share of the blame for today’s sky-high prices goes to misguided local government policies.”

The most obvious reason for steeper home prices and less affordability is that we simply have bigger houses. According to the Census Bureau, the average house now contains 2,434 square feet, up from 1,660 square feet in 1973. If you super-size a home by 47 percent then even if construction expenses remained constant it’s not hard to see why today’s housing dreadnoughts cost more than homes in previous years. This is not to say that minimum lot and home sizes add anything to the cause of affordable housing, or to suggest that rising costs for building permits, impact fees and transfer taxes are helpful. But c’mon, homes on steroids can’t be overlooked—homes which surely yield bigger builder profits per unit than smaller homes.

Looking for that perfect Sarasota home or condo? Realtor® Annette Smith is ready to help you buy or sell your dream property.

Or, ready to buy or sell a Palm Beach home or condo? Consult with licensed agent Caesar Parisi. Caesar has assisted hundreds of buyers and sellers, giving sound advice on how to most effectively buy and sell property.

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