The Department of Housing and Urban Development (HUD) and the Department of Agriculture (USDA) have announced they have rescinded the mandate that all new homes be built with the 2021 International Energy Conservation Code as the minimum energy-efficient standards, or they would be ineligible for an FHA or USDA-backed mortgage loan.
The Biden Administration-era policy was estimated to increase the cost of housing construction by $20,000 to $31,000, as stated in a release from HUD. The National Association of Home Builders (NAHB) estimated the increase in new home prices to be $9,600 and $21,400, depending on the climate zone, which Chairman Bill Owens called “overly burdensome.”
The compliance date for the mandate had previously been delayed, with the most recent pushback requested in February to delay the deadline until Dec. 31, 2026. With this newly announced Joint Determination, the mandate will now be wiped from the slate.
HUD Secretary Scott Turner said that by rescinding the mandate, HUD and USDA are “removing a significant regulatory barrier that added tens of thousands of dollars to the cost of a new home.”
“The Trump Administration’s focus is to facilitate new housing supply and ensure that every American family has a path to homeownership without being sidelined by bureaucratic red tape.”
Turner and USDA Secretary Rollins noted that solutions to the housing crisis are at the top of the Trump Administration’s priorities, with Rollins also specifically calling out creating more affordability in rural housing.
“We launched the Rural Revival Agenda at USDA to bring rural communities to the forefront of our actions, and this joint determination restores common sense to our programs and ensures that we can continue bringing new affordable housing supply online for Americans,” added Rollins.
NAHB commended the move to rescind the mandate, which Owens said would have “threatened to deepen the nation’s housing affordability crisis.”
“Compliance with the rule would have placed significant new cost pressures on home builders and multifamily developers, making it harder to deliver the affordable, attainable communities that are urgently needed,” he continued. “By repealing this onerous mandate, the Trump administration is making it easier for builders to construct more housing supply at an attainable price for Americans.”
