Western Governors Association Unveils Housing Plan That Includes NAHB Priorities
During its June 22-24 meeting in Santa Fe, New Mexico, the Western Governors Association (WGA) unveiled a new report focused on expanding housing to western states that includes several initiatives championed by NAHB to address the nation’s housing affordability crisis.
NAHB worked closely with the WGA in drafting the report, Building Resilient and New Affordable Developments in the West, and NAHB Chairman Buddy Hughes participated in a panel that highlighted the key findings and recommendations from the report.
Hughes encouraged the governors to keep the “5 Ls” in mind when working on housing issues:
- Labor,
- Land,
- Lumber and materials,
- Lending, and
- Laws and regulations.
The lack of skilled labor, local land use policies that restrict home and apartment construction, lumber price volatility and elevated material prices, high lending costs for builders, and high regulatory burdens are the main drivers of low housing supply and high home prices, he noted.
The report contains a number of policy objectives recommended by NAHB that seek to ease home building costs and increase the supply of housing.
Notably, it calls on the U.S. Department of Housing and Urban Development (HUD) and U.S. Department of Agriculture (USDA) to carefully consider how new standards, codes and requirements will affect the cost of housing financed by the agencies. Specifically, the report referenced that HUD and USDA have finalized a rule to adopt the 2021 International Energy Conservation Code as the new minimum energy standard for the new construction of housing financed by the agencies. The administration has since announced a six-month delay in enforcing this rule.
Hughes made mention of how a home needs to be built “to the energy code that makes climate and market sense” and not to a higher standard just because a new code is published.
Hughes noted this rule could add as much as $31,000 to the price of a new home and said that NAHB is working on the legal and legislative front to prevent this standard from being imposed because it would drive up housing costs and hinder housing construction at a time when the nation needs to increase the housing supply.
On the federal level, the report also recommended that Congress should:
- Strengthen the Low-Income Housing Tax Credit;
- Support the expansion of education and skills training opportunities for the skilled construction workforce, including apprenticeships and career and technical education;
- Allow exemptions to Davis-Bacon if prevailing wage rates are less than the minimum wage in a jurisdiction;
- Ensure adequate appropriations for housing block grants to state and local governments; and
- Examine potential solutions to growing insurance challenges in collaboration with states and other key partners.
Recommendations to lower housing costs and boost production at the state and local level include:
- Modernize land use regulations;
- Expedite permit plan and review processes;
- Reform zoning laws;
- Remove rules that discourage density and residential development; and
- Implement statewide programs focused on development and preservation of housing, such as state low-income housing tax credits and state-specific affordable housing funds.
NAHB supports these initiatives and is a proud contributor to this report, along with a number of western HBAs who also contributed ideas and worked to put this housing blueprint together.