- Affordable housing developers say HUD enforces Build America, Buy America strictly and offers no quick way to get waivers, stalling projects that rely on HVAC, elevators and locks.
- More than $68 billion of funding has been covered since 2024, about 3% of residential construction spending, and public housing authorities say compliance often adds 15% to 20% to costs.
- Some developers have cut projects or dropped features like rooftop solar, and a watchdog and a new housing law are pushing HUD to fix the process.
HUD’s Buy America requirement is stalling affordable housing projects and driving up costs, developers told Bloomberg.
More than $68B of funding has fallen under the Build America, Buy America rule since 2024, roughly 3% of residential construction outlays. Public housing authorities report that complying usually adds 15% to 20% to costs.
Get Smarter about what matters in CRE
Stay ahead of trends in commercial real estate with CRE Daily – the free newsletter delivering everything you need to start your day in just 5-minutes
The Certification Trap
Projects have to certify that equipment is entirely U.S.-made, which has proven close to impossible for items such as HVAC systems, elevators and door locks.
Congress extended the rule to HUD-funded housing in 2021. Developers say HUD runs it differently from other agencies, with no fast process for waivers on items that can’t be sourced domestically. Review requests sit for months, they say.
Projects Shrink
Avesta Housing planned rooftop solar for a New Hampshire apartment building, then dropped 136 panels worth $194,000 because it couldn’t certify every component, including the roof mounts. It still sourced 97% of the building’s materials domestically.
In Alaska, the Cook Inlet Housing Authority scaled planned buildings of six and nine units down to four apiece to absorb higher costs. Colleen Dushkin, a vice president there, told Bloomberg the rule bites hardest in Alaska because many materials come from Canada.
HUD and the Unions
According to a HUD spokesman, officials have halved a waiver backlog inherited from the prior administration and moved the program to a unit used to working with developers. HUD Secretary Scott Turner pointed to President Trump’s directive that agencies stop granting waivers freely.
Steelworkers legislative director Roy Houseman told Bloomberg other agencies’ waiver systems show HUD can build one. DOT and EPA already keep libraries of standard waivers.
Zoom Out
Domestic sourcing is one more cost layered onto a tough build environment. We covered how home building costs have climbed on tariffs, labor and rates, and how developer confidence slid with the NAHB index at 41.
Why It Matters
Delays mean carrying land and rate risk longer. Jennifer Schwartz of the National Council of State Housing Agencies told Bloomberg that waiting adds costs on top of the cost of another consultant.
Estimates of the affordable housing shortage run above 7M units, so every stalled project widens the gap.
What’s Next
This summer’s bipartisan housing law directs HUD to gather stakeholder input. HUD’s independent watchdog also urged the agency, in a Sept. 10 report, to name an owner for Build America, Buy America decisions and give that office real authority.
