The U.S. faces a shortage of about 10 million homes, according to a new report from the White House Council of Economic Advisors. Largely responsible for the shortfall is the slower pace of homebuilding since the 2008 global financial crisis, a slowdown the report blamed on local regulations.
The report argues that “increasingly pervasive California-style fees, mandates, regulations and red tape that add expensive government overhead to the cost of building” constitute “the government bureaucrat tax on housing supply.” It cites deregulation as a top priority.
In a statement, the National Association of Home Builders noted that the report cites NAHB regulatory studies. “As added context, the NAHB estimates that the bureaucrat tax constitutes 24% of the cost of a new home,” the White House report said. It also cited a joint study by NAHB and the National Multifamily Housing Council that regulatory costs add an even higher share of 41% for multifamily housing.
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