Nearly one-quarter of home price can be traced back to regulatory costs

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Costs including impact fees, building permits, utility hookups, and stormwater regulations.

May 11, 2016
Nearly one-quarter of home price can be traced back to regulatory costs

Photo: Brandon Leon/Creative Commons.

A National Association of Home Builders study found that an average of 24.3% of a home’s selling price can be linked to local, state, and federal regulatory costs.

During development of building lots, costs including impact fees, utility hookups, and stormwater regulations are factors, as are costs of regulatory delays, such as additional loan interest payments. Other regulatory costs include building permits, the expense of implementing new worker safety regulations, tariffs on materials, and requirements in the home such as fire sprinklers and carbon monoxide warning systems.

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