The National Association of Home Builders and the National Multifamily Housing Council released the results of a survey of multi-family apartment builders and developers across the country in the 4th quarter.
They found that regulatory demands imposed by all levels of government add 32.1% on average to the cost of every apartment building in our country. These charges include fees, land dedication, and the cost of complying with various mandates “that go beyond the ordinary”. And building code changes from the last 10 years have added an extra cost of 7.2% to the cost of every apartment building. Finally, 85% of builders reported extra costs or delays due to neighborhood opposition.
In other words apartment rents could be 32% LOWER with less government regulation. Thus, a 2 bedroom apartment that currently rents for $2000 a month, would rent for $1360 a month if the regulatory costs were waived. Now, rent is not so expensive.