Although regulation can lead to innovation in sustainability and other areas, its negative influence on housing now, especially in places like California, is threatening the ability for builders to create an affordable product. The question remains, how can the industry influence regulation to drive both innovation and affordability?
Regulations on both a federal and a state level have become extremely onerous for those who want to develop property for housing. Because of the a myriad of requirements and mitigations, costs to comply compound the length of time it takes to navigate through the maze causing some projects to delay more than 10 years before a street or house are ever built.
Additionally, local municipalities, due to aging or inadequate infrastructure, are requiring more offsite mitigations, which add to the financial burden. Are some of these regulations and mitigations justified?
Yes, but it is being taken to an extreme that has made the cost of producing a buildable lot excessive. The result is very small lots that only allow for a minimal space between houses.
Ms. Swisley was complementary of the state legislature’s actions on the affordable housing issue, but I believe they have actually been complicit in making the situation worse. They talk passionately at length about their concern for those hurt by the cost of housing, but then they pass laws that require those developers and builders to go well beyond what are the national norms in environmental mitigation and energy saving construction.
For example, the state passed a law that requires all new housing by 2020 to be “net zero” for power usage, meaning that it must be built in a way that does not use more power than it can produce.
You could say that this requirement is a worthy initiative, but it comes at a very steep price for the purchase of a home.