As a contributing member of the construction industry you are all too aware that regulations come in many forms and are imposed by many levels of government. Your business will incur both direct and indirect costs. Those costs include; business license, permit, hook-up/tap, 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. New NAHB estimates based on the latest data show that, on average,
regulations imposed by government at all levels account for almost 25 percent of the final price of a new single-family home built for sale. Three-fifths of this—14.6 percent of the final house price—is due to a higher price for a finished lot resulting from regulations imposed during the lot’s development. The other two-fifths—9.7 percent of the house price—is the result of costs incurred by the builder after purchasing the finished lot.
In many areas across our country these regulatory costs are much higher and consequently take a much larger slice of your profitability. Not one aspect of our industry is exempt from these costs and forecasts note the trend of even higher regulatory costs. While your HBA legislative team has a record of success beating the regulatory barriers and their additional costs back we are literally plugging holes with our fingers in a regulatory dike ready to break loose. Our efforts, to date, have saved the home building industry more than $400 million in 2016 alone. This equates to more than $15,000 in additional costs on every house built in S. C., but we, as an Association, must be ready to support a more robust regulatory affairs program to defend our industry. Your membership in the HBA is instrumental in our defense, but we will need to explore new avenues to support our Association and our member’s profitability.
• South Carolina Builder Journal • 2016