HUD Confirmation Hearing Centers on Regulatory Burdens, Affordability and Need for More Housing

The need to eliminate excessive regulations — a key NAHB priority — was an overriding theme during yesterday’s Senate confirmation hearing on the nomination of Scott Turner as the next secretary of the U.S. Department of Housing and Urban Development (HUD).

Sen. Jim Banks (R-Ind.) cited the Biden administration’s rule that requires HUD and the U.S. Department of Agriculture to insure mortgages for new single-family homes only if they are built to the 2021 International Energy Conservation Code and noted these standards could drive up construction costs by up to $31,000:

“What is your view on that?” Banks asked Turner.

“Anything that is burdensome to build affordable housing we need to take a strong look at that and remove,” said Turner. “I am focused on how do we build affordable housing in this country.”

Sen. Mike Rounds (R-S.D.) noted that during a time when there is a growing demand for additional housing, federal regulations like Davis-Bacon requirements are slowing the construction process and increasing costs nationwide. He asked Turner whether HUD will make it a priority to review and adjust program regulations to match the risk that they pose to housing affordability.

“The goal is to look at all the programs and ask is this helping the mission of HUD or not,” said Turner. “Is it helping to promote affordable housing or not?”

Sen. Chris Van Hollen (D-Md.) cited the detrimental effect that Canadian lumber tariffs are having on housing affordability and asked Turner whether a further increase on lumber tariffs would make housing more unaffordable.

“I don’t want to get into the tariff conversation because that is not my job, that’s the president’s and your job in Congress,” said Turner. “What I want to do is combat anything that raises the cost of housing, be it the cost of construction, be it fees, be it regulatory burdens. That’s what I’m focused on senator, to bring those things down.”

Sen. Katie Britt (R-Ala.) noted an NAHB statistic that 24% of the cost of building a single-family home is attributable to government regulation and cited the need for deregulation and to streamline HUD for greater efficiency.

Turner committed to take an inventory of the programs at the agency to determine what’s working and not working “so that we can be more efficient.”

In addition to seeking regulatory reform at the federal level, Turner said it was a priority to take action at the state and local level as well.

“We want to make it more flexible and easier for developers to build affordable workforce attainable housing across our country,” he said. “If confirmed, a top priority will be to look at all the regulatory burdens from the federal side and also work with localities and states to see how we can ease those burdens so developers can build and supply goes up as demand goes up because right now we are not meeting that demand.”

Responding to another question by Sen. Tina Smith (D-Minn.) on how regulations at the local level hamper the development and construction of housing, Turner noted that permitting fees, inspection fees and restrictive local zoning rules “are hindering developers from building affordable and workforce housing.” He went on to add, “senator, just in multifamily alone, when you look at regulations, that it is almost 40% of the costs to build multifamily.”

These issues raised at the committee hearing — the need to eliminate excessive regulations at all levels of government, adopt reasonable and cost-effective building codes, end tariffs on Canadian lumber and other building materials, alleviate permitting roadblocks and overturn inefficient local zoning rules — are all part of NAHB’s 10-point housing plan to combat the housing affordability crisis and allow builders to increase the nation’s housing supply.