Secretary Scott Turner and Secretary Brooke Rollins announced the removal of a Biden Administration policy that increased new home construction costs by at least $20,000.
The 2024 Final Determination required all new homes to meet the 2021 International Energy Conservation Code (IECC) to qualify for FHA or USDA-backed mortgage loans. This standard has only been adopted in a few states and added significant expenses to homebuilding.
Estimates showed that enforcing the 2021 IECC nationwide would raise construction costs by $20,000 to $31,000. This increase could price many first-time buyers out of the market. The mandate also threatened to reduce new home production, complicate construction, and delay permitting and inspections.
Secretary Turner said removing the mandate eliminates a costly regulatory barrier and supports expanding housing supply. He emphasized the goal of helping more American families achieve homeownership without excessive government restrictions.
Secretary Rollins highlighted the focus on affordable rural housing. She noted the USDA’s Rural Revival Agenda aims to cut unnecessary rules that drive up home prices and to promote new affordable housing options in rural areas.
The Trump administration had delayed the original 2024 compliance deadline multiple times. Most recently, HUD extended the deadline to December 31, 2026, while seeking public input on the standard.
After reviewing comments, HUD and USDA issued a Joint Determination to fully rescind the 2024 Final Determination. FHA and USDA loan programs will return to the energy efficiency requirements in place before the 2024 rule.
This decision aligns with a recent court ruling in Texas that found the Biden-era policy would reduce housing availability.
Are you concerned about how energy standards affect your ability to buy a home? How should regulators balance energy goals with housing affordability?
