The Home Builders Association of Michigan on Feb. 1 published a release criticizing both the Department of Licensing and Regulatory Affairs and proposal by Gov. Gretchen Whitmer to invest $1.4 billion in housing across the state. Whitmer announced the proposal during her Jan. 24 State of the State Address.

A Jan. 24 release from Whitmer’s Office says the state will make the largest investment to build housing in Michigan history, nearly $1.4 billion to build or rehabilitate nearly 10,000 homes.

“That is 10 times what the state invested to build housing 10 years ago,” the release states. “Building more of every kind of housing — single family homes, apartments and mixed-use buildings — will expand supply and lower costs. Getting this done will also support thousands of good-paying jobs in the skilled trades–from pipefitters and carpenters to bricklayers and roofers.”

The HBAM, responded to Whitmer’s address in a Jan. 24 release, saying the actions of the Whitmer Administration are contradictory.

“The Governor unveiled her plan to invest some $1.4 billion in much needed housing across the state this evening,” the HBAM release states. “However, recently proposed changes to building codes by the Michigan Department of Licensing and Regulatory Affairs, including mandatory sprinkler requirements in all new homes and other costly changes, will raise the cost of building a typical Michigan home by more than $20,000. This will price-out some 100,000 families (or more) from being able to afford a home in Michigan and reduce overall housing production.”

On Feb. 1, HBAM reported an 8% drop in statewide housing permits in 2023, announcing that the preliminary survey results from the U.S. Census Bureau show that single-family home construction in Michigan shrank by nearly 8% in 2023 compared to 2022. The total number of single-family housing permits issued in the state last year totaled 13,856 compared to more than 15,000 that were issued in 2022. The last time production levels hit this mark was in 2006, HBAM says. Since then, Michigan has built 13,000 new homes a year on average.

LARA’s proposals, as currently drafted, states the MBAM release, will require new residential homes (and most renovated homes) to have 2 x 6 framing, R-60 insulation in ceilings, inch-thick exterior sheathing, mandatory fire suppression systems (sprinklers inside homes) and arc fault circuit interrupters in every room, among other costly measures.

With high interest rates and a median home sales price approaching $450,000 or more in some areas, many Michigan residents have already been priced out of the housing marketplace, the release says.

At the same time, HBAM CEO Bob Filka said that neither sprinklers nor arc fault circuit interrupters will save lives.

“Research shows that properly functioning smoke detectors are the key to fire safety in homes,” Filka said in the release. “Requiring sprinklers in all new homes will not. To the contrary, it will make new housing more expensive and keep or push people into older substandard housing that is more susceptible to fire.”

Every state in the country has rejected the idea that sprinklers should be required for residential homes, Filka said in the release.

“LARA is either operating in a vacuum or is pandering to manufacturers who would like to mandate the use of their products instead of convincing homeowners their products are worth purchasing,” he said.

For every $1,000 increase in the cost of a home in our state, nearly 5,000 households are priced out of being able to afford one, Filka noted.

“If not altered, the state’s proposed code changes will price-out more than 100,000 additional Michigan families,” he said. “These proposed changes need to be modified and can be, while achieving similar goals at far less cost.”

Filka stated that builders are not opposed to improving state building codes.

“HBAM has offered an alternative proposal to the state that would result in similar energy efficiency improvements at 1/3 of the cost of LARA’s proposal, by removing manufacturer-driven proscriptive requirements and providing more options and flexibility for builders,” Filka said. “We have been a partner with the Whitmer Administration in pursuing many new efforts to increase attainable housing production across the state. That positive momentum will be lost if we don’t balance the cost of new building code standards with housing attainability.”