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It's worth considering California building code in the cost of new construction.

• sgc 7y ago
  California building code is really not that different from anywhere else in the US, since almost all states base their code off the IBC. it costs a little more to build in a seismic zone or a high fire risk zone, but that is inevitable. The code does help keep people alive and healthy, and protect against more costly damage than otherwise in case of natural disasters. In California, 25% of a new SFR is land. Another 25% easy goes to permits and municipal utility connections. 40% construction costs (including paying the boss a salary), and if you are lucky, 10% profit. Simply reducing permitting costs and streamlining the process to reduce holding costs (without even easing restrictions, just being more efficient/faster at the municipal level) could shave 20% off a new home price. That would drive down all home prices to some extent and open up a large number of people to get out of the renters pool. So CA government is the major player to blame for housing costs, and these laws are in place of just doing their jobs well. This might drive prices down too, eventually, but not nearly as quickly or fairly as bureaucratic reform would.
  • PorterDuff 7y ago
    Do they require fire suppression systems and solar panels in the rest of the US? I honestly don't know.
    • sgc 7y ago
      Fire suppression is required everywhere AFAIK. Solar is not yet required, but will be next year. So it has had no effect on current Ca housing. That is a stupid rule and should have exemptions for areas that don't receive enough sun due to fog/trees/etc. But solar will still be far, far cheaper than permits and will add value/decrease ownership costs for most homes.