Buddy Hughes, chairman of the National Association of Home Builders (NAHB) called on the Trump administration Tuesday to negotiate a long-term softwood lumber agreement with Canada that will end lumber tariffs, help stabilize the volatile housing market and give builders greater price stability.
Testifying before the House Financial Services Subcommittee on Housing and Insurance, Hughes told lawmakers that the nation is facing a “fever-pitch housing affordability crisis,” with nearly 77% of households not able to afford a median-priced new home. He said current conditions were making it increasingly difficult for builders to produce housing that is affordable for buyers and renters. The result is that the U.S. is short about 1.5 million housing units and rising construction costs are only fueling the current crisis.
To address these problems, Hughes called on Congress to preserve and strengthen successful federal housing initiatives, including the low-income housing tax credit, the Department of Housing and Urban Development’s (HUD) Section 8 housing voucher programs and HUD’s investment partnership and community development block grant programs.
Beyond ending tariffs on construction materials, Hughes called on the Trump administration to boost the domestic supply of lumber, support workforce development initiatives, rein in excessive regulatory costs and reassert congressional authority over the rulemaking process for federal agencies.
Specifically, Hughes called for passing the Identifying Regulatory Barriers to Housing Supply Act, which will reduce minimum lot size requirements and allow more density on single-family zoned areas.
Hughes said that the crucial issues facing U.S. builders could be described as the “five Ls,” which stand for lending, labor, lumber, lots and laws.
He explained how the construction sector faces a persistent labor shortage, with more than 200,000 unfilled industry jobs. At the same time, construction material costs are up 34% since December of 2020, mainly because of supply chain disruptions. This has resulted in higher home prices and rents.
Other problems include limited supplies of lots for home building, due to tighter rules regarding land use and zoning for housing, and the prohibitive cost of regulation.
“Regulatory costs account for about a quarter of the purchase price of a new single-family home, and even more for apartment buildings due to construction delay costs and zoning issues,” Hughes said. “And these regulatory burdens have made it very difficult to build entry-level housing for first-time homebuyers.”
