NAHB Welcomes Regulation

It would be an understatement to say that NAHB resists regulation. Just think how they fought residential sprinkler systems for so long.

But given who they are, who can blame NAHB for fighting regulations? They don’t want their builder members to be required to comply with regulations if the cost of compliance can’t be recovered. And that’s the key to understanding NAHB: If the builder can’t recover the money he puts into a project when complying with regulations, it eats directly into his bottom line, and that’s the kind of regulation NAHB traditionally has fought.

Needless to say, more than a few heads were turned when NAHB started going so heavy into green a few years ago. In 2004, NAHB allowed the Model Green Home Building Guidelines to be issued, and it didn’t seem so extraordinary. The guidelines were nonbinding, and NAHB got some good PR for its efforts.

But when the Model Green Home Building Guidelines morphed into the National Green Building Standard, NAHB was finally dabbling in potentially binding building regulation that might require builders to pay extra to comply with. Then, when NAHB started conversing with the ICC and the American National Standards Institute, it looked even more serious. Now, NAHB’s National Green Building Standard, also known as ICC-700, has formally been approved by ANSI. With this approval, NAHB has allowed third-party certification of the building practices in its new green standard.

So, you have to ask yourself: Why the change of heart by the NAHB? Why would an organization that has so fiercely fought regulation suddenly act as though they’ve found green religion in a new building standard that will cost builders money?

Part of the reason is that NAHB wants its own (very pro-builder) green standard to be the green standard for building new homes, instead of other potentially more onerous and costly standards that originate from other organizations, such as the federal government or the USGBC. (Since the LEED for Homes program — a.k.a. “LEED-H” — really isn’t taking off, NAHB’s efforts look all the more likely to define the de facto standard for green, single-family homes.)

But something more is going on here. NAHB has done a great job of vertically integrating its green brand. You can now be an NAHB Certified Green Professional, who builds homes certified by NAHB’s green standard, which uses certified green products, scored by the NAHB Research Center. NAHB is essentially allowing builders to brand themselves and their homes as green using NAHB’s own rules and institutions. Why? It may be out of the goodness of NAHB’s heart, but it is also (and more likely) about the builder’s bottom line.

By enabling builders to brand their homes as green, and to provide evidence of third-party green verification, the builder can recover the premium he puts into his green projects … hopefully at a profit, if he’s shrewd about marketing his projects. In the end, NAHB looks great because they have been proactive in addressing green — which consumers like. Moreover, NAHB has provided a vehicle for its members to recover investments they make in green projects (third-party-verified homes), all the while driving realtors and buyers away from (finally!) the square-foot-pricing method of valuing homes that has done so much damage to our industry, as I pointed out in a recent column.

Today, 4,000 projects have been verified using the National Green Building Standard’s online system. And no matter what NAHB’s motives, I welcome the outcome: certified, green, high-performance homes.