This past week the National Association of Home Builders (NAHB) told Congress that burdensome government regulations and mandates which support environmental, social and governance (ESG) policies impede the housing industry's ability to increase the production of quality, affordable housing.
Testifying on this topic at a House Financial Services subcommittee hearing, NAHB Chairman Alicia Huey said a growing number of ESG policies at the local, state and federal level are having a direct impact on housing production and affordability.
"ESG policies already have caused home insurance companies to drop out of some areas and raise rates in others," said Huey. "Bank lenders are being urged to minimize the risks associated with their portfolios, causing concern they may cease lending in certain locations or increase their borrowing rates. And as supply chain woes continue to stifle residential construction projects across the nation, we worry that ESG disclosure requirements could further impede or prevent availability of needed building supplies and/or transportation to their required destinations."
With the nation experiencing a housing affordability crisis, Huey added that "now is not the time to create or support additional regulations that add more uncertainty, delays and costs to the home building process."
She then noted how several regulatory and codes issues are exacerbating the housing affordability crisis:
"These are just a few examples that illustrate how regulatory costs, which account for about 24% of the price of a typical new single-family home, contribute to the housing affordability crisis," said Huey. "NAHB continues to urge Congress and the Biden Administration to address these factors that hamper the ability of home builders to increase the supply of quality, affordable housing."