Finally, after endless years, Congress actually agrees on something and almost unanimously voted through the much-needed housing act, which will attack many of the issues hurting the housing market. There have been many things that have negatively affected the housing market. Many have occurred over the last several years, but some have been a problem for a long time.

  • Obviously the higher interest rates and the explosion in home prices over the last several years has been the biggest factor.
  • However, there are other negatives, including the aging housing market. Available housing across the country is aging, and even more so in the Lehigh Valley, the average age of a house in the United States is now 43 years old, while the average age in the Lehigh Valley is at an average of 54 years old. The reason for this was the overreaction to the 2008 housing recession. Since then, there has been a large decrease in new homes being built. This has led to increased and costly repairs of the older houses, renovations, and homes that are energy inefficient. 
  • Hidden costs: (1) property insurance costs are up 72 % since 2019, mainly due to natural disasters such as several destructive hurricanes along the east coast, and the wildfires in California. (2) Property taxes have surged due to the huge increases in home values. (3) The increase in HOA’s. 39 % of homes now have HOA fees, as compared to only 31 % in 2019. That is an increase over 25 %.
  • Most importantly are the absolutely ridiculous regulatory costs to build a new home - $131,734! That is up 40 % in 5 years, and now represents 26.4 % of the total cost of a new home. The NAHB provided an excellent breakdown of the costs:

Cost of applying for zoning approval

$7007.00

Hard cost of compliance (fees, required studies, etc.)

$10,755.00

Land dedicated to the gov’t or otherwise left unbuilt

$13,593.00

Standards (setbacks, etc.) that go beyond the ordinary

$10,583.00

Complying with OSHA/other labor requirements

$2,377.00

Pure cost of delay (if regulation imposed
no other cost)

$2,480.00



ALL REGULATION DURING DEVELOPMENT

$46,795.00



Fees paid by the builder after purchasing the lot

$20,154.00

Changes to building codes over the past 10 years

$40,288.00

Architectural design standards beyond the ordinary

$16,117.00

Complying with OSHA/other labor requirements
(construction)

$6748.00

Pure cost of delay (if regulation imposed
no other cost)

$1,632.00



ALL REGULATION DURING CONSTRUCTION OF THE
STRUCTURE

$84,939.00



TOTAL COST OF REGULATION

$131,734.00

As changes in the housing market create new opportunities for homeowners and homebuyers across Pennsylvania, having the right moving team can make the transition that much easier. If you're planning a move anywhere in Pennsylvania, O’Brien’s Moving & Storage provides trusted residential moving services for local, long-distance, and interstate moves. Our experienced team is here to help make your move as enjoyable as your destination.

Next: How the ROAD Act and other measures will eventually bring back the American Dream.