HUD delays new-construction energy efficiency standards

The Department of Housing and Urban Development is pushing some pending compliance dates for energy-efficiency standards on new construction mortgages further down the road, according to a document filed in the Federal Register.

HUD is postponing deadlines for Federal Housing Administration-insured single-family and multifamily loans, in addition to other programs the standards affect and for which final determination date has not passed.

The move comes soon after the National Association of Home Builders sued HUD and the U.S. Department of Agriculture over the energy efficiency standards introduced in 2024. Builders had estimated that the requirements to bring standards in line with the 2021 International Energy Conservation Code would add tens of thousands of dollars to the price of a new home.

NAHB Chairman Buddy Hughes called the development, "an important step forward to help ease the nation's housing affordability crisis" and urged the USDA "to take the same action," in a press statement.

The Community Home Lenders of America also welcomed the delay.

"CHLA had called for elimination of this federal incursion into local construction standards," Scott Olson, executive director of the CHLA, said in a press release in which he asserted the new requirement could result in the denial of FHA loans "for many homebuyers of new homes. 

"Therefore, CHLA calls on FHA to use this delay to take final action to permanently shelve this proposal," he added.

HUD said the delay "will provide additional time for the administration to review questions of fact, law and policy."

The department is officially extending the single-family compliance date for which the building permit application is the initiation event to 24 months after the effective date of May 28, 2026.

The multifamily compliance date has been extended to 18 months after the effective date of Nov. 28.

The FHA also recently issued a waiver for new construction requirements aimed at mitigating flood risk, suggesting it's been reviewing building standards more broadly.