NAHB NEWS Regulations Account for Nearly One-Third of Multifamily Costs, Builders Tell Congress Reported Shortage of Rough Carpentry Contractors Hits Record 90 Percent Labor and subcontractor shortages became even more widespread in July of 2018 than they were a year earlier, according to single-family builders who responded to special questions on the survey for the NAHB/Well Fargo Housing Market Index. The July 2018 survey asked builders about shortages in 15 specific occupations that were either recommended by Home Builders Institute or other key stakeholders. Shortages of labor directly employed by builders were at least fairly widespread for each of the 15 occupations, ranging from a low of 47 percent for building maintenance managers to a high of 83 percent for rough carpenters. However, on the typical home building project, three-fourths of the construction cost represents work performed by subcontractors. For that reason, it is particularly significant that, in the 2018 survey, the incidence of shortages was higher for subcontractors than for labor directly employed by builders in 14 of the 15 occupations. At the bottom of the charts, the shortage incidence was the same (47 percent) for building maintenance managers, whether subcontracted or directly employed by builders. For weatherization workers, the spread was 2 percentage points (50 percent for subcontractors vs. 48 percent for labor directly employed). For the other 13 occupations, the incidence of the shortage was 4 to 9 percentage points higher for subcontractors. Read More 24 HBRA of Fairfield County | SEPTEMBER 2018 Layers of excessive regulation translate into higher rents, reduced affordability for consumers and on average, account for almost one-third of a multifamily project’s development and building costs, the National Association of Home Builders (NAHB) told Congress today. Testifying on behalf of NAHB before the House Financial Services Subcommittee on Housing and Insurance, Steve Lawson, chairman of The Lawson Companies based in Virginia, said that overregulation of the housing industry is felt at every phase of the building process. “It results from local, state and federal mandates,” said Lawson. “It includes the cost of applying for zoning and subdivision approval, environmental mitigation, and permit, hook-up, impact and other government fees paid by the builder. In many cases, these projects become financially infeasible and, therefore, are not built.” The congressional hearing on regulatory burdens on multifamily housing development was spurred in large part due to a new study by NAHB and National Multifamily Housing Council called Multifamily Cost of Regulation that details how regulatory costs account for 32 percent of the cost of developing new multifamily properties. Read More
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