When discussions arise about updating building codes, one argument always surfaces: increased costs will make housing less affordable. This concern, often raised by builders and contractors, can seem reasonable at first glance. But let’s take a closer look at what’s really driving housing costs—and it’s not just building codes.
The reality is that while builders point fingers at the costs of compliance, they’re quietly upselling luxury features like $10,000 countertops, $20,000 cabinet packages, and countless other amenities. These upsells are pitched as lifestyle enhancements, adding significant markups that increase home prices far more than modest code updates ever could.
Builders rarely mention these upsells when discussing affordability. Instead, they focus on the relatively modest costs of code compliance, portraying themselves as champions of the homebuyer. But this narrative ignores the significant role their own business practices play in driving up prices.
Here’s a personal example. In the northern U.S., I lived in an older home with a boiler, where my natural gas bills during harsh winter months regularly hit $600-$700 per month. Later, I lived in an energy-efficient home where my heating bills never exceeded $200—even in the same climate. The savings were immediate and significant. Over just a few years, the initial investment in energy-efficient construction easily pays for itself, and homeowners continue to benefit for decades.
Despite these clear advantages, builders often frame energy efficiency as a cost burden rather than an investment in long-term savings. This narrow focus on short-term costs is misleading and does a disservice to homeowners who stand to gain from improved energy standards.
This approach creates inefficiencies that drive up costs—yet these inefficiencies are rarely part of the affordability conversation. Instead, builders focus on blaming building codes for rising prices, distracting from the role their own practices play.
It’s also worth noting the financial health of these builders. Many of the largest homebuilders are publicly traded companies with strong profit margins and consistent growth. In early 2024, the ten largest homebuilders in the U.S. reported a collective 18% increase in new home orders. These are not companies on the financial brink, yet they argue that modest code updates threaten affordability.
When builders oppose these updates, citing affordability, it’s essential to ask: affordability for whom? For the homeowner, who benefits from lower energy costs and increased safety? Or for the builder, who wants to protect their profit margins while upselling optional features?
Building codes are not the enemy of affordability. They’re part of a broader effort to ensure homes are safe, sustainable, and cost-effective over the long term. The next time builders complain about the cost of compliance, it’s worth asking why the same level of concern doesn’t apply to the luxury features they upsell with hefty markups.
The reality is that while builders point fingers at the costs of compliance, they’re quietly upselling luxury features like $10,000 countertops, $20,000 cabinet packages, and countless other amenities. These upsells are pitched as lifestyle enhancements, adding significant markups that increase home prices far more than modest code updates ever could.
The Cost Excuse vs. Reality
The homebuilding industry often uses examples like $2,000 for enhanced insulation or $700 for arc-fault circuit breakers to argue that building codes make homes unaffordable. But these costs pale in comparison to what builders routinely charge for optional upgrades. A luxury kitchen countertop can easily cost $5,000-$10,000, and upgraded cabinets frequently add $10,000-$20,000 to the home price. These markups go largely unquestioned by buyers—so why is $2,000 in energy-efficient insulation treated as an unbearable burden?Builders rarely mention these upsells when discussing affordability. Instead, they focus on the relatively modest costs of code compliance, portraying themselves as champions of the homebuyer. But this narrative ignores the significant role their own business practices play in driving up prices.
Energy Efficiency: A Case Study in Savings
Let’s talk about energy-efficient construction—a frequent target of builder complaints. The claim? Stricter energy codes add upfront costs that make homes less affordable. The reality? These upgrades save homeowners thousands of dollars over the life of the home.Here’s a personal example. In the northern U.S., I lived in an older home with a boiler, where my natural gas bills during harsh winter months regularly hit $600-$700 per month. Later, I lived in an energy-efficient home where my heating bills never exceeded $200—even in the same climate. The savings were immediate and significant. Over just a few years, the initial investment in energy-efficient construction easily pays for itself, and homeowners continue to benefit for decades.
Despite these clear advantages, builders often frame energy efficiency as a cost burden rather than an investment in long-term savings. This narrow focus on short-term costs is misleading and does a disservice to homeowners who stand to gain from improved energy standards.
The Profit-Driven Shift
The evolution of the homebuilding industry has also contributed to rising costs. Gone are the days when the builder was on-site, tool belt strapped on, solving problems in real-time. Today’s builders operate within corporate structures, with layers of management often far removed from the realities of the job site.This approach creates inefficiencies that drive up costs—yet these inefficiencies are rarely part of the affordability conversation. Instead, builders focus on blaming building codes for rising prices, distracting from the role their own practices play.
It’s also worth noting the financial health of these builders. Many of the largest homebuilders are publicly traded companies with strong profit margins and consistent growth. In early 2024, the ten largest homebuilders in the U.S. reported a collective 18% increase in new home orders. These are not companies on the financial brink, yet they argue that modest code updates threaten affordability.
The Role of Building Codes
Building codes aren’t arbitrary obstacles. They’re carefully developed standards designed to ensure safety, efficiency, and resilience. The costs associated with compliance are modest compared to the broader benefits they provide. Stronger energy codes, for example, reduce utility bills and make homes more comfortable and environmentally friendly.When builders oppose these updates, citing affordability, it’s essential to ask: affordability for whom? For the homeowner, who benefits from lower energy costs and increased safety? Or for the builder, who wants to protect their profit margins while upselling optional features?
Shifting the Narrative
If builders truly cared about affordability, they’d address their own markups and inefficiencies before blaming building codes. Legislators and the public need to scrutinize the full picture, considering all the factors that contribute to rising home prices—not just compliance costs.Building codes are not the enemy of affordability. They’re part of a broader effort to ensure homes are safe, sustainable, and cost-effective over the long term. The next time builders complain about the cost of compliance, it’s worth asking why the same level of concern doesn’t apply to the luxury features they upsell with hefty markups.
