The excessive money printing and low interest rate environment are bulking up the price-tag of houses across the United States. But another factor has come into play that could affect your next home purchase: government regulations.
According to a new report from the National Association of Home Builders (NAHB), a portion of the cost of a brand new single-family home caused by government regulations has increased 30 percent in the last four years alone. This is double of how much disposable income Americans have.
Regulations, the report points, $84,671 to the price of a new home. This is an increase of 29.8 percent from 2011’s $65,224. A majority of the costs come from the development stage (14.6 percent), followed by regulations incurred by the builder after the developed lot has been purchased (9.7 percent).
Ostensibly, the federal government can add its own costs to a house. And more regulations are expected to come, the report warns.
“Regulations come in many forms and can be imposed by different levels of government,” the report stated. “At the local level, jurisdictions may charge permit, hook-up, and impact fees and establish development and construction standards that either directly increase costs to builders and developers, or cause delays that translate to higher costs.”
What’s funny is that every time the government touches something, it immediately becomes more expensive.
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