Report finds government regulations add nearly $132,000 to new home prices

A report from the National Association of Home Builders (NAHB) indicates that government regulations are contributing an average of $131,734 to the cost of newly built homes, which represents 26.4% of the final sale price. This estimate is based on an average new-home price of $499,500 and marks the largest increase recorded by NAHB since it began tracking this data in 2011. Regulatory costs have increased by 40% since 2021, exacerbating the housing affordability crisis as many Americans struggle to become homeowners. NAHB President and CEO Jim Tobin stated that the U.S. is facing a structural housing shortage of 1.2 million homes, and rising regulatory costs hinder efforts to increase supply. The report notes that regulatory costs vary by region, with states in the Southeast generally having lower costs compared to states like California and New York. Tobin emphasized the need for policymakers to reform regulations to help reduce costs while maintaining necessary health and safety standards. The analysis is based on surveys conducted in March 2026 involving 54 land developers and 337 single-family builders.