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Childcare Costs vs. Housing Prices: A Cost Squeeze with No Easy Way Out

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In this week’s housing and construction news roundup, we break down the real forces driving costs higher—from childcare expenses now exceeding affordability benchmarks in every state, to infrastructure uncertainty, water constraints, and shifting federal policy that could impact how homes are built and priced.

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SPEAKER_02

There's a new pressure point in the housing crisis, and it's not just mortgage rates, prices, or supply. It's childcare. According to a new report from Realtor.com, in every state, childcare exceeds the federal affordability benchmark. The U.S. has short more than 4 million homes and nearly the same number of childcare slots. In some markets, childcare now costs more than rent or even college tuition. When both costs rise together, saving for a home becomes increasingly out of reach. And the daisy chain continues as childcare providers themselves face higher rents, raise their prices, or shut down, tightening supply even further. Hi, I'm Katie O'Keefe, and you're watching this week's Sustainable Building News. We're keeping our eye on another big issue brewing, and that's infrastructure. The American Society of Civil Engineers put out a statement raising concerns over the sacking of leadership of the National Science Board, which oversees the National Science Foundation. As ASCE President Marcia Anderson Baumar explains, much of what we know about resilient buildings, roads, bridges, and long-term performance comes from NSF-backed research. For municipalities, this could mean less clarity on zoning, land use planning, and infrastructure investment. For builders and developers, more volatility in site selection, foundation design, stormwater systems, and materials specs. Plus, rising costs tied to insurance, permitting delays, and redesigns as standards shift or become less predictable. Even infrastructure like roads, drainage, and utilities become harder to model, making projects riskier and more expensive to deliver. Water constraint also continues to be a headache for housing development in many areas of the country, and now we can see it thanks to the U.S. Geological Survey, which just launched a nationwide tool that maps water supply versus demand across about 80,000 watersheds. It shows that 27 million Americans already live where demand strains supply, proving that water is becoming a key factor in where and whether we build. What used to take months of analysis now takes minutes. You can try the mapping tool for free. The link is in our show notes. So let's focus on solutions. There's a growing argument that one of the biggest tools we have to fix the housing crisis is hiding in plain sight. A new analysis from Brookings says the Federal Home Loan Bank System, a $1.3 trillion network originally created to support housing, is no longer doing that job. Instead, it's largely acting as a low cost funding source for big banks. Meanwhile, the U.S. is short millions of homes and multifamily construction has slowed sharply, largely because financing has gotten too expensive. So the proposal is redirect that system back to housing. Specifically, use a portion of its funding to provide below market construction loans for housing, especially the missing middle, those five to forty-nine unit projects that are often the hardest to finance. The impact could be significant, potentially helping to fund hundreds of thousands of new homes each year without new taxpayer spending. Another solution may be found in New Jersey, which is making a major push to tackle housing affordability. Governor Cheryl has issued an executive order aimed at accelerating home building across the state after hearing a consistent message from residents. I don't know how I can afford to stay here. Home prices in New Jersey are up roughly 60% over the past five years. Her plan focuses heavily on using vacant, state-owned land, including parcels near transit hubs where demand is already high. There's also a clear timeline that within 150 days the state will roll out a full strategy to boost supply and cut red tape. This could become one of the most aggressive state-level housing plays in the country and a model others may follow. And one more policy move just breaking today. This one is going to get the attention across the industry. NAHB is applauding a decision by the U.S. Department of Housing and Urban Development and the U.S. Department of Agriculture to roll back a proposed energy efficiency mandate. The rule would have required certain housing programs to meet 2021 International Energy Conservation Code and Ashray's 90.1-2019 standards. From their perspective, removing the rule helps builders deliver more attainable housing and eases pressure on affordability. But in truth, the move will push the higher ongoing cost to homeowners or renters. On to other news. 3D printed housing is scaling up and Colorado is leaning in. Azure printed homes just opened a Denver factory using recycled plastic and large-scale printers to build modular homes. The promise is homes for under $100,000 ready in weeks. Built indoors, the process cuts delays and speeds production. The facility could produce up to 7,000 homes a year. A major ruling out of Ohio could reshape how electricity works in multifamily housing. The state Supreme Court has pushed back on submetering, where landlords or third parties buy power in bulk and resell it to tenants, potentially forcing the model to operate more like a regulated utility, which could negatively impact developers. If submetering shifts or moves back to direct utility metering, projects could see higher costs, more coordination, and tighter margins. What was once a revenue or efficiency play becomes a compliance issue. States like California, New York, and Massachusetts already regulate submetering, but this ruling sets a legal precedent other states could follow. Manufacturers may feel it too, with demand shifting toward utility integrated smart systems over standalone submeters. In the architecture realm, we're seeing signs of a rammed Earth resurgence. Yes, Earth, one of the oldest building materials on the planet, is making a serious comeback in some of the most advanced, high performance projects in the world. What's striking about this piece, written in parametric, isn't just the science, although that's certainly there, from improved engineering to modern prefab, but the visuals. These buildings are stunning, layered textures, natural tones, and walls that quite literally breathe. Check out the article linked in our show notes and read about seismic resilient hospitals in the Himalayas to civic buildings in France. It's also tapping into something deeper, a design shift away from one size fits all construction toward buildings that respond to their environment, their climate, their place. There's a signal coming out of Europe that U.S. builders should be watching. According to Reuters, rooftop solar demand has surged since the Iran conflict, with homeowners rushing to install systems as energy prices spike. In some cases, demand has more than doubled, and many are adding battery storage to take full control of their power. But the real shift isn't solar, it's why people are buying it. It's scarcity consciousness, a mindset that's starting to show up in the United States. Solar is moving from a green feature to a hedge against volatility, something that protects homeowners from outages, rising costs, and an uncertain grid. Japanese home builders are making a much bigger move into the U.S. housing market. We should know because we're partnered with Sakasui House on our latest Vision House project. According to reporting from the Wall Street Journal, Japanese firms are now on track to control about 6% of U.S. home construction after a wave of acquisitions that's been going on since 2020. Major players like Sakasui House and Sumitomo Forestry have been buying American builders, including Sakasui's purchase of MDC Holdings and Sumitomo's deal for Tri Point homes. This is happening because Japan's home building market is shrinking because of population decline. That makes the U.S. with its housing shortage a long-term growth opportunity. These companies bring patient capital, cheaper financing, and deep experience with factory built and more efficient construction methods. Perhaps Japanese-style building systems can help the U.S. solve one of its biggest problems, mainstreaming prefab. Our editor's product pick this week is Belgard's Diamond Pro Airwall Block, which is 30% lighter, using less material and cutting energy use in production. It also improves logistics, fitting 25% more blocks per truckload, which reduces fuel use, emissions, and cost. On site, it can build near vertical walls up to 12 feet high, minimizing excavation and preserving more usable land. Visit BellGuard.com. NAHB and the International Code Council have officially released the 2025 National Green Building Standard, the latest benchmark for sustainable residential construction in the U.S. Approved by American National Standards Institute, the new standard expands guidance across energy, water, resilience, and indoor environmental quality, while introducing new pathways for multifamily and low carbon design. Click the link in our show notes to download a copy. In our latest Impact Series podcast, we hear from Chris Castro, who's done something most people in sustainability have not. He's worked across all three layers that actually drive change: local government, federal policy, and now private capital. From launching grassroots sustainability projects to helping deploy over $11 billion in federal clean energy funding to rethinking how solar is financed through his job at Climate First Bank. This conversation gets into what's really holding the industry back. Take a listen.

SPEAKER_00

I think it's these regional governments that are made up of both conservative and more progressive parts of these regions that are actually coming together, finding common ground, finding the opportunities around workforce development, around economic development, around how to harden our infrastructure so that we can withstand the next major hurricane, which we know we're going to get, right? How do we make these regional investments together so that we reduce each individual cost and we can strengthen us as a whole? And it's that same concept of being stronger, you know, greater than the sum of its parts, right? Um, and so uh yeah, it's really exciting. And by the way, now there's a regional collaborative in pretty much every part of the state. There's one in the Tallahassee Panhandle, there's one in the Duval area in Jacksonville, there's Tampa Bay's, there's Central Florida, there's a Southwest and a Southeast. And they talk on a monthly basis to coordinate amongst the R2C so that you know there are things that collectively we could all be moving forward or working with the legislature to enable, right?

SPEAKER_02

Our upcoming webinar on May 20th offers a real-world look at solar plus battery installs before and after incentives. When the 30% federal solar tax credit expired at the end of 2025, homeowners rushed to install. Darren and Devin WatchTack got ahead of it, and now they're sharing what it actually took to get their systems in. Learn more about roof-mounted versus ground-mounted systems, the full process, including contracting, financing, permitting, installation, real system performance plus utility bill impacts, and how DER and virtual power plant programs actually work. Click the link in the show notes to register or hit our knowledge base tab on our nav bar to register. Let me leave you with a few interesting stats that came out this week. The percent of Gen Z homeowners who spend 30% or more of their income on mortgage payments now sits at 32%. This is higher than both millennials and Gen X borrowers, according to Lending Tree. The percent of U.S. homeowners who are interested in or actively considering an ADU is 17%, or nearly one in five people, according to a survey by Block Renovation. This illustrates how economic times are pushing people to consider innovative ways to house themselves. And the share of new homes that used to be considered starter homes, which has hovered at around 40% for a long time, is now less than 10%, showing how dramatically entry-level housing has disappeared. Well, that's our show.

SPEAKER_01

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