Homebuilding - NAHB Publishes Updated Regulatory Cost Study; Our Thoughts On The Matter

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Homebuilding - NAHB Publishes Updated Regulatory Cost Study; Our Thoughts On The Matter

Truist Securities

Equity Research Report June 9, 2026

INDUSTRIALS: Homebuilding

Homebuilding - NAHB Publishes Updated

Regulatory Cost Study; Our Thoughts On Jonathan Bettenhausen

404-439-7629 The Matter Jonathan.Bettenhausen@truist.com

This most recent edition of the NAHB cost of regulation study showed a 40% increase in

the regulatory cost of building a home since 2021. Regulatory cost has notably outpaced

5 Page Document home prices since the 2021 study and now accounts for over 26% of a new home price.

A good chunk of the increase stems from building code adoption over the past 10 years.

We agree with the sentiment that deregulation would improve affordability; however, this

Reasons for this report would require a multi-year effort across all levels of gov't. Thus, we do not see recent

political moves (such as the White House's deregulation EO and 21st Century ROAD

✓ Sector Update to Housing) as sufficient and significant developments for homebuilding stocks.

✓ Thoughts on Builder Regulatory

Environment

Study Goes in Depth on Regulatory Costs on Home Building. Earlier today, the

National Association of Home Builders published a study examining the total regulatory

costs of constructing a new home in the US (linked HERE). According to the study, the

total cost of regulation in the average priced new home (~$500K) is about $131K, or

about 26% of the total price of the home. The study results are derived from additional

questions on the group's monthly Housing Market Index survey and is completed every

5 years. This is the 4th edition of the study, with the last completed in 2021. At that

point, the NAHB calculated that the cost of regulation accounted for less than 24% of