WASHINGTON, DC — Secretary Scott Turner and Secretary Brooke Rollins announced the rescission of a costly Biden Administration-era policy which added at least $20,000 to the cost of home construction.
A 2024 Final Determination issued under President Biden rendered all new home construction ineligible for an FHA or USDA-backed mortgage loan unless the home was built according to the 2021 International Energy Conservation Code (IECC) – a standard which has only been deployed in a few states.
According to some estimates, enforcing the 2021 IECC as a mandatory nationwide standard would result in an increased home construction cost of between $20,000 and $31,000 – an increase that pushes most new homes out of reach for many first-time homebuyers. This government mandate would also decrease new home production, complicate construction, and lengthen permitting and inspection timelines.
“By rescinding this mandate, we are removing a significant regulatory barrier that added tens of thousands of dollars to the cost of a new home,” said Secretary Turner. “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.”
“Affordable rural housing is a top priority for the Trump Administration, and we are focused on removing all the unnecessary restrictions that artificially drive up new home prices,” said Secretary Rollins. “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.”
Since taking office, the Trump Administration has delayed the compliance date for the 2024 Final Determination. Most recently, HUD published an extension on February 3, 2026 that delayed the deadline for HUD programs until December 31, 2026. In July 2025, HUD and USDA issued a Request for Information (RFI) seeking additional comment from stakeholders to help inform the agencies’ review of the 2024 standard.
Following an extensive review of these comments, HUD and USDA are issuing a Joint Determination which rescinds the 2024 Final Determination in its entirety. As a result, the FHA and USDA loan programs will comply with the energy efficiency standards that were in effect prior to the publication of the 2024 Final Determination. This determination is also in alignment with a recent ruling from the U.S. District Court for the Eastern District of Texas which found that the Biden-era determination would decrease housing availability.
Bill Owens, chairman of the National Association of Home Builders (NAHB) and a home builder and remodeler from Worthington, Ohio, issued the following statement after the announcement:
“NAHB commends HUD and USDA for taking decisive action to roll back these overly burdensome energy mandates, which 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. Research shows that adopting these standards could have added between $9,600 and $21,400 to the price of a new home depending on the climate zone. 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.”
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