Jun 16, 2026
Housing affordability is top of mind for Americans watching average property prices steadily creep up in their area. As tempting as it may be to blame the changes on high interest rates, rapidly accelerating population growth or the construction delays and economic fallout still resonating from the lockdown era, there is another potentially greater and more easily remedied contributor to exorbitant housing costs.
New measures to reduce the financial burden of buying a home have been introduced by various levels of government in 2026, including, in March, executive orders from President Donald Trump to reduce the bureaucracy — and, importantly, the fees — associated with getting homes built.
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Though some have questioned how the orders would realistically be implemented and pointed out ways in which they could complicate the Senate’s recently-released 21st Century ROAD to Housing Act, the discussion surrounding them has at least helped bring to light how much regulatory red tape really does add to the price tag of a home: more than a shocking $130,000, on average, according to a new report from the National Association of Home Builders.
Survey shows enormous escalation in regulatory costs to building in recent years
Published on June 8, the research takes into account survey responses from both developers and home builders, who attest to the fact that the obligatory costs of things like zoning applications, soil testing, environmental impact assessments, feasibility studies and meeting various codes and criteria have escalated considerably in recent years, with a larger jump between 2021 and 2026 (40%) than between any other consecutive years of the poll.
Based on the research, the costs associated with these requirements put forth by local, state and federal governments now account for a staggering 26.4% of the final price of a new single-family home, adding to an average of $131,734.
Though the NAHB states “this study is not arguing that all regulation is bad or should be eliminated,” it does believe the data is a crucial piece of the puzzle of why home prices have inflated as they have, and why fewer and fewer people are able to achieve the dream of home ownership.
“In an environment where housing is regulated in a complex way by a variety of federal, state and local entities, it is useful to have a numerical estimate of how much regulation exists… when contemplating new policies or revising existing ones,” it says, adding that a plan to tackle these assorted rising costs is “likely necessary” to make housing in America more affordable.
“No matter how you look at it, the 26.4% — or $131,734 — of the average new home price attributable to regulation remains noteworthy and economically important,” the report reads.
Groups like the National Association of Realtors likewise see this financial hurdle as one of the biggest impediments to more affordable housing supply, saying in a recent statement about the data that our era of “excessive regulation” is “pricing buyers out of the market and slowing construction.”
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What Trump’s executive orders aim to achieve
The findings arrive as the Trump administration pushes to reduce housing costs through a pair of executive orders issued in March that target the aforementioned red tape to create supply and consumer access to mortgage credit.
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The directives are intended to reduce some of the permitting requirements, zoning barriers and regulatory hurdles that builders say contribute to higher housing costs.
The first order targets a number of environmentally-minded provisions specifically: clean energy requirements, density planning guidelines, water use rules and aspects of the National Historic Preservation Act, among other things that the Trump administration refers to as presenting layers of unnecessary regulatory barriers mandates.
Most zoning and land-use ordinances fall under municipal or county authority, but there are worries that if jurisdictions don’t abide by the best practices of the new orders, they could lose federal funding for home construction.
The second order seeks to improve mortgage affordability and availability by reducing regulatory burdens on lenders.
The NAR and the NAHB have expressed support of the orders, which they say adequately address the “root of the housing problem” on the supply side.
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Becky Robertson is a senior staff reporter with Moneywise and a lifelong writer. Along with years in the journalism industry at outlets such as blogTO and Quill & Quire, she's participated in writing residencies at the Banff Centre and Writing Workshops Paris. With 33 countries visited, she finds travel to be one of her greatest inspirations.
