Three years ago I built a house to sell (I was general contractor) on a city lot my family owned. Before a single shovel of dirt was turned over, we had to pay around seventy thousand dollars for plan review, power connection, water, sewer and gas.
This really opened my eyes as to how much mitigation costs have risen over the years. I had built a house in the same area in 1989 and the initial costs were one tenth of that.
Seems a punitive tax on the entrepreneurial middle class. Such fixed costs might be insignificant for a palatial home. At the other end, large-scale developers know all about negotiating discounts and otherwise offloading costs.
There was a great article on this system, basically to build a house you need to have so much skill to navigate the maze of red tape, rules and regulations and so on.
That is true for every field, the skills required to do anything is increasingly specialized.
My grandfather became a pharmacist by simply apprenticing to one and then later owning a pharmacy. My mom had to only do a 3-year course, today it would be lot more difficult than that.
You can call it red-tap or code, we have learnt a lot over the last centuries, we put these regulations to protect the average consumer. Sometimes it is overkill, but most regulations have been payed for in blood. Aviation is very visible example.
> That is true for every field, the skills required to do anything is increasingly specialized.
I think OP's main point is that the majority of the regulated process is not necessary for his project. I would guess OP went through the whole process, and felt that the checks and examinations probably did not do much good to himself or the future home buyers. Thus the outrageous cost becomes an issue, because with the cost, the value is not justifiable.
As for pharmacist, I would totally agree that modern medicine is exponentially more complex than 30 years ago, and that's in a good way: the mechanism of how the medicine works are more advanced, variety increases exponentially, cost is down and more people are using more medicines.
Comparably, building a house has not been much different than what's in 1970s. Aside from newer materials in components, the house building is largely equivalent to what's in 1970s. I got this impression from my own house that is built in 1972, and watching the new building materials been used now on YouTube.
Lots of it is a tax on non-residents; because other tax forms are kept low but nobody "pays" for the permit costs, etc (it's wrapped in the cost of the house).
The US will often have guarantees on a construction loan, and sometimes the bank will even inspect the property as it is being built and only release funds when certain points are hit - 30% to start, 20% when foundation is poured, 20% on framing, 30% on completion. And then the loan will be refinanced to a traditional mortgage (construction loans are usually short-term and higher rate).
Many builders will therefor "self-finance" and sell the customer a "built home" direct into a normal mortgage.
This really opened my eyes as to how much mitigation costs have risen over the years. I had built a house in the same area in 1989 and the initial costs were one tenth of that.