IBC and IECC Adoption Map 2021–2024: U.S. Trends, Timelines, and Strategic Impacts

Introduction

Building codes in the United States are constantly evolving, and their adoption can significantly impact development and investment decisions. The International Building Code (IBC) and International Energy Conservation Code (IECC) are model codes published on a three-year cycle (2018, 2021, 2024, etc.) by the International Code Council (ICC). States and local jurisdictions adopt these model codes (often with amendments) on varying timelines, leading to a patchwork of code editions across the country. This report provides a comprehensive overview of U.S. adoption trends for the 2021 and 2024 editions of the IBC and IECC, including state-by-state timelines and strategic implications. We will explain the purpose and structure of the IBC and IECC, analyze key differences between the 2021 and 2024 editions, map out which states have adopted these codes (and when), and discuss what these trends mean for developers and investors in terms of design requirements, energy targets, costs, and risk.

(Keywords: IBC 2024 adoption by state, IECC 2021 vs 2024 compliance, building code investment impact, energy code adoption trends USA.)

Understanding the IBC and IECC

International Building Code (IBC): The IBC is a comprehensive model building code that covers minimum standards for structural design, fire safety, means of egress, accessibility, and other aspects of building construction (except one- and two-family dwellings, which are covered by the IRC). The IBC’s purpose is to ensure public health and safety in the built environment. It is updated on a 3-year cycle through an open consensus process and is widely used in all 50 U.S. states (either through state adoption or local jurisdiction use). The code is organized into chapters covering topics such as occupancy classification, building heights/areas, interior finishes, structural loads, fire protection systems, and more. When a state adopts the IBC, it typically becomes the baseline for commercial and multi-family building design in that jurisdiction.

International Energy Conservation Code (IECC): The IECC is a model code that regulates the energy efficiency of buildings, both residential and commercial. It sets standards for building envelope insulation, HVAC efficiency, lighting, power, and other factors affecting energy consumption. The IECC’s goal is to reduce energy usage and environmental impact, while balancing cost-effectiveness. Since its introduction over a decade ago, increasingly stringent IECC editions have contributed to substantial energy savings and carbon emissions reductions in communities that adopt them. (In fact, the IECC became about 40% more energy-efficient from 2006 to 2021 through successive updates.) The IECC is divided into a Residential IECC and Commercial IECC, and it often references ASHRAE 90.1 (an alternative energy standard for commercial buildings) as a compliance pathway. States may adopt the IECC as part of their building code updates or have separate energy code adoption processes. The IECC is a key tool for jurisdictions aiming to meet sustainability and climate goals.

Model Code Adoption Process: Once the ICC publishes a new edition (e.g. the 2024 IBC and IECC were published in late 2023), each state decides if and when to adopt it. Some states have automatic or mandatory adoption cycles (e.g. updating to the latest code every 3 years), while others require legislative or board action. Many states amend the model codes to suit local conditions or policy preferences (for example, states often amend the IECC to modify insulation requirements or add options). A few states do not adopt statewide codes at all, leaving code enforcement to local governments. This means that at any given time, different states are enforcing different editions of the IBC/IECC – which is why tracking “IBC and IECC adoption maps” and timelines is so important for architects, developers, and investors.

2021 vs 2024 Code Editions: What Changed?

Both the 2021 and 2024 editions of the IBC and IECC introduced updates that reflect evolving priorities – from structural safety enhancements in the IBC to aggressive energy performance boosts in the IECC. Understanding the differences between the 2021 and 2024 codes is crucial for anticipating how new code adoption might affect building design and costs.

IBC 2021 vs 2024: Key Changes

The 2024 IBC continues the IBC’s trajectory of strengthening safety and updating provisions for new technology. Some significant changes from 2021 to 2024 include:

• Administrative Authority: The duties and powers of the building official (IBC Chapter 1) are expanded in 2024. The code official is explicitly authorized to interpret code compliance, require technical reports from owners, approve alternative materials/designs, and must maintain thorough records. This reorganization (also mirrored in other I-Codes) clarifies the code official’s role in ensuring compliance and alternative methods.

• Carbon Monoxide Detection: In 2021 IBC, CO alarms were required in residential (Group R) and educational (Group E) occupancies. The 2024 IBC broadens this requirement to all occupancy types – any building with potential CO sources must have detection systems. This change means occupancies like offices, retail, factories, etc., will now need CO alarms where fuel-burning appliances or garages are present, enhancing life safety.

• Wind and Tornado Resilience: The 2024 IBC introduces new structural design requirements for tornado-prone regions. For the first time, tornado load data and design criteria appear in the code (e.g. in Chapter 16 structural provisions). High-risk buildings (like hospitals or emergency shelters) in certain regions must be designed for tornado wind loads in 2024, whereas the 2021 IBC had no explicit tornado design data. This change will improve resilience in “Tornado Alley” states but may slightly increase structural costs.

• Plumbing Facilities: The 2024 IBC updates the minimum required plumbing fixtures (toilets, sinks, etc.) by adding several new occupancy categories in Chapter 29. For example, ambulatory care facilities and more sub-classifications of institutional occupancies now have specifically defined fixture counts. The 2021 IBC had fewer categories, so designers now must pay attention to these new distinctions (which can affect space planning for restrooms).

• Construction Fire Safety: A notable addition in the 2024 IBC is Section 3302, “Owner’s Responsibility for Fire Protection,” which requires a site-specific fire safety plan, a designated fire safety director, and daily fire safety inspections during construction. These must be submitted for approval and are enforceable by code officials. The 2021 IBC only had general provisions for construction safety, whereas 2024 establishes a formal process to reduce fire risks on construction sites (a response to numerous construction-phase fires in recent years).

  
  

(Other 2024 IBC changes include technical updates like assigning risk categories for photovoltaic panel installations on roofs, and tweaks to various structural and egress requirements. In summary, the 2024 IBC emphasizes enhanced safety (CO alarms, tornado resistance, fire planning) and clarity in administration.)

Table: Selected Differences – 2021 vs 2024 IBC

Aspect	2021 IBC (Previous)	2024 IBC (New)
CO Detection	Required in R (residential) and E (educational) occupancies only	Required in all occupancies with CO sources
Tornado Resilience	No explicit tornado design requirement (wind design per region only)	New tornado load design data and structural provisions for high-risk buildings in tornado-prone areas
Plumbing Fixture Counts	Fewer occupancy categories (e.g. general outpatient clinics not distinguished)	Additional occupancy categories (ambulatory care, etc.) now specified for minimum fixtures
Construction Fire Safety	General duty to maintain safety during construction (no detailed plan required)	Dedicated section 3302: requires fire safety plan, safety director, and inspections during construction
Admin Authority	Code official interprets code; alt methods allowed (less detailed)	Expanded duties: code official can require technical reports, approve alternatives, and must keep extensive records

IECC 2021 vs 2024: Key Changes

The 2024 IECC represents a major leap in energy code strategy, focusing on flexibility and decarbonization, while still ratcheting up efficiency. Some key differences between the 2021 and 2024 IECC include:

• Overall Efficiency Gain: The 2021 IECC was roughly a 10% improvement in efficiency over the 2018 edition. The 2024 IECC continues the trajectory with about a 7% aggregate efficiency improvement over 2021. This means buildings complying with 2024 will use ~7% less energy than those under the 2021 code, on average. The efficiency gains come from numerous incremental upgrades in insulation, HVAC, and lighting requirements.

• New Compliance Paths (Flex Points): The 2021 IECC introduced an “additional efficiency credits” system (requiring builders to choose a package of measures worth 10 points) as a new compliance path. The 2024 IECC expands this credit-based compliance approach – the required number of credits now varies by building type and climate zone, often more than 10, pushing teams to prioritize an array of efficiency options. This “choose your own adventure” style gives designers flexibility to meet targets via different combinations (more insulation vs. better HVAC vs. renewable energy, etc.) The result is greater flexibility in 2024 IECC compliance versus the more prescriptive 2021 code.

• Renewables and Electrification: A notable shift in 2024 is the emphasis on on-site renewable energy and electrification. The 2021 IECC had no mandatory renewable energy requirements. The 2024 IECC, however, requires new commercial buildings to include on-site renewable energy generation (solar panels) sized at least 0.75 W/ft², or procure equivalent off-site green power if on-site is not feasible. It also places greater emphasis on electric-ready infrastructure. Early drafts of the 2024 IECC included aggressive electrification and greenhouse gas provisions (aimed at reducing fossil fuel use), but some of those controversial items were scaled back before final adoption. Nonetheless, the 2024 IECC clearly leans toward supporting building electrification and decarbonization goals.

• Building Envelope & Insulation: The 2021 IECC significantly tightened insulation and envelope requirements, which some builders found challenging (especially for retrofits). In 2024, ceiling insulation R-values have actually been relaxed back to 2018 IECC levels for certain climate zones, recognizing diminishing returns and constructability concerns. However, wall insulation is more climate-tailored – the 2024 code offers more flexibility in warm zones while still demanding high performance in cold climates. Window efficiency (U-factor) requirements are about 7–10% stricter in many climates compared to 2021, meaning higher-grade windows/doors will be needed to comply. The air leakage testing thresholds are also tightened to ensure tighter envelopes (air sealing is taken even more seriously in 2024).

• HVAC and Systems: The 2021 IECC introduced new HVAC controls (like requirements for temperature setpoint resets when large exterior doors open). The 2024 IECC goes further: it adds humidity control limits to prevent inefficient dehumidification/humidification cycles, expands demand-controlled ventilation to more spaces and climates, and requires more HVAC systems to have “occupied standby” modes to save energy when spaces are unused. It also mandates that if a single HVAC fan serves both ventilation and heating/cooling in a dwelling unit, that fan must meet a higher efficiency threshold or designers must split the systems (encouraging dedicated outdoor air systems). Lighting system requirements are likewise updated – e.g., 2024 requires continuous dimming capabilities down to 10% (versus stepped dimming before) for more space types, and introduces demand-responsive lighting controls that automatically trim lighting during peak load events. Additionally, sub-metering is now required in commercial buildings ≥10,000 sq.ft. (threshold halved from 25k in 2021) to track energy by end-use.

• Cost and Flexibility: A core theme of the 2024 IECC development was balancing efficiency with cost-effectiveness. The code development process shifted to a consensus committee of industry stakeholders, including builders, specifically to address concerns that prior energy code upgrades were driving up costs. As a result, the 2024 IECC offers more compliance options than ever – which can actually lower construction costs compared to the 2021 IECC for some buildings. A study by Home Innovation Research Labs found that by choosing the most cost-effective options (thanks to the flexible credit system), builders can comply with 2024 at lower cost than the rigid 2021 requirements, while still achieving the additional energy savings. In short, the 2024 IECC tries to deliver both improved efficiency and more affordable compliance paths.

Table: Selected Differences – 2021 vs 2024 IECC

Aspect	2021 IECC Requirements	2024 IECC Updates (changes)
Efficiency Level	~10% more efficient than 2018 code	~7% more efficient than 2021 code (cumulative ~17% vs 2018)
Compliance Path	Additional 10-point credit system introduced for flexibility	Expanded credit system – credits required vary by building type & climate (greater design flexibility)
On-site Renewables	Not required (only encouraged)	Mandatory renewable energy for many commercial buildings (0.75 W/ft² solar or equivalent); or off-site purchase if on-site not possible.
Electrification Focus	Minimal – no direct GHG limits, EV-ready optional	Greater emphasis on electrification (e.g. electric-ready provisions, efficient electric HVAC encouraged) – some GHG reduction proposals were considered (many later removed). Overall trend toward electric systems.
Insulation (Envelope)	Very stringent envelope (R-49+ ceilings in many zones, high wall R-values). Builders noted difficulty in some retrofits.	Ceiling insulation relaxed to 2018 levels in some zones; Wall insulation more climate-specific (e.g. warm climates get flexibility). Window U-factors ~7–10% stricter on average. Air leakage limits tightened (blower door tests must hit lower ACH).
HVAC & Controls	Required some shutoffs and basic controls (demand control ventilation in large high-occupancy rooms, etc.)	New HVAC controls for humidity extremes, expanded demand-controlled ventilation to more spaces/climates, occupied-standby modes for HVAC in intermittently used spaces. Service hot water insulation and recirculation controls improved.
Lighting & Power	Introduced partial dimming and lighting controls, 150W daylighting threshold	Continuous dimming 0–100% now required in many spaces (was stepped); Daylight zone threshold halved to 75W. Demand-response lighting capability required for load shedding in some scenarios. Sub-metering required for more building sizes and end-uses (≥10k sq.ft., including non-electric fuels).

In summary, 2024 IECC ups the ante on energy efficiency but does so in a way that offers builders multiple paths to compliance. It leans into future-looking concepts like on-site power generation and electrification-readiness, while also applying lessons learned (e.g. dialing back overly stringent insulation where it wasn’t yielding returns). The implication is that states adopting the 2024 IECC will be pushing developers toward higher performance buildings, but with more choice in how to get there.

State-by-State Adoption Trends (2021–2024)

Adoption of the 2021 and 2024 IBC/IECC across U.S. states has not been uniform. Some states moved rapidly to adopt the 2021 codes, while others are only now transitioning from 2015 or 2018 editions. The 2024 editions are just beginning to be reviewed by states, setting the stage for the next wave of adoptions in 2024–2026. Below we present an overview of adoption status by state, along with a timeline of key adoption milestones. Understanding these code adoption trends in the USA is critical for national developers and investors, as building and energy requirements (and enforcement dates) differ widely by location.

IBC Adoption Map and Timeline

After the ICC publishes a new IBC edition, it typically takes 1–3 years for most states to adopt it (some faster, some slower). The 2021 IBC was published in late 2020; by late 2023, around 18 states (mostly those with proactive building code agencies) had adopted the 2021 IBC as their statewide code. These include states like Alabama, California, Florida, Maryland, New Jersey, Virginia and others, many of which implemented the 2021 IBC in 2021 or 2022. Another group of roughly 13 states were still on the 2018 IBC as of 2024 – for example Georgia, New York, Pennsylvania, Washington and several midwestern states. A smaller set of states (around 8–10) had even older codes: as of early 2024, Indiana, Tennessee, and Texas were still using the 2012 IBC as their basis (putting them four code cycles behind the latest), and a few like Maine, Massachusetts, Michigan, Wisconsin were on the 2015 IBC.

It’s important to note that some states do not mandate a statewide building code at all for private buildings. For instance, Missouri has no mandatory state building code (state buildings use 2012 IBC, but all local jurisdictions set their own rules). Kansas also has no statewide code, nor do a few others like Colorado and Arizona (which leave building codes to local governments). In those states, major cities usually adopt the latest I-Codes (e.g. Denver or Phoenix might use 2021 IBC), but rural areas may have minimal codes. This local-control approach results in intrastate variation – an investor building in St. Louis, MO must follow that city’s code (currently 2018 IBC), whereas a project in a small Missouri county might have no enforced code at all.

Overall, the regional trends for IBC adoption show that Western and Southeastern states tend to adopt new codes on schedule or with one cycle delay, whereas some Midwestern and New England states historically lagged (or skipped from 2015 to 2021). However, there are exceptions: for example, North Carolina historically adopted the 2018 codes and then decided to leap directly to the 2024 IBC (skipping 2021) – the 2024 NC Building Code was slated for Jan 2025 implementation but has been postponed by a year due to legislative delays. Ohio took an early lead on the 2024 cycle: in August 2023, Ohio adopted the 2024 Ohio Building Code (based on 2024 IBC) to take effect in 2024–2025. These early adoptions signal that some states will begin moving to the 2024 IBC even before others have left the 2015/2018 versions. By contrast, states with limited legislative sessions or resistance to new regulations may not consider the 2024 IBC until 2026 or later.

For a state-by-state breakdown: By 2024, states such as Alabama, Louisiana, Montana, North Dakota, Utah, Wyoming and others are on the 2021 IBC; Georgia, New York, Illinois (local adoption), Pennsylvania, Washington and several others are on the 2018 IBC; Massachusetts, Michigan, Wisconsin, Kentucky (etc.) use the 2015 IBC; and a handful like Indiana, Tennessee, Texas remain on 2012 IBC or older. The map of IBC adoption (if visualized) shows a mix, but effectively every state either uses an ICC-based code or allows local jurisdictions to use one – the IBC (in some edition) is in use nationwide as the baseline for commercial building standards.

IECC Adoption Map and Timeline

Adoption of the energy code (IECC) often follows a slightly different pattern due to the political sensitivity of energy regulations. Some states that quickly adopt the IBC have been slower to adopt newer IECC editions (energy code updates can face opposition due to perceived construction cost increases). Conversely, a few states and cities forge ahead with cutting-edge energy codes to meet climate goals.

When the 2021 IECC was released, a “bunch of states jumped on [it] pretty quickly,” especially in the Northeast. By mid-2022 through 2023, Massachusetts, Vermont, Maine, Rhode Island, Maryland, Delaware, and Washington D.C. had adopted the 2021 IECC (often with state-specific amendments for their climate or policy). For instance, Massachusetts integrated the 2021 IECC into its base energy code in 2023 (along with an even stricter stretch code for cities) and other New England states did similarly. New York, Connecticut, and New Hampshire also moved to adopt the 2021 IECC in that timeframe – New York, notably, decided to skip directly to the 2024 IECC (with plans to adopt a NY energy code in 2025 that meets or exceeds 2024 IECC). In the Midwest, Illinois by law updates its energy code on the DOE cycle and adopted the 2021 IECC (effective 2023) statewide. Colorado passed legislation in 2022 requiring local jurisdictions to adopt at least the 2021 IECC by 2023, effectively bringing the entire state up to the 2021 level or better. And in the West, states like Oregon, Washington, Nevada, Utah, and Montana all adopted the 2021 IECC or an equivalent state-specific code by 2022 (Nevada even adopted it as early as mid-2021). Louisiana stands out in the South as an early adopter – it approved the 2021 IECC in 2022 (with some amendments to ease the transition).

However, a stark regional divide persists in energy code stringency. Many Southeastern states are on much older IECC editions. According to an ACEEE report, as of 2022 states like Georgia, North Carolina, and Alabama were using the 2015 IECC, and South Carolina and Oklahoma were on 2009 and 2006 IECC respectively – the weakest energy codes in the nation. (Indeed, South Carolina’s energy code is still essentially IECC 2009, even though its building code is 2021 – illustrating how some states decouple energy standards from building codes.) Oklahoma’s residential energy code is IECC 2009 and commercial is IECC 2006 – extremely outdated levels of efficiency. Tennessee and Mississippi have also lagged on energy codes (Tennessee’s residential code is based on 2009 IECC, and Mississippi until recently had no mandatory energy code statewide). In the Midwest, Ohio and Michigan were on the 2018 IECC, while Indiana and Wisconsin had energy codes stuck at 2015 or older. Some Plains states like South Dakota and North Dakota have no enforced statewide energy code (despite adopting the latest IBC for structural safety) – leaving efficiency requirements optional or governed by local choice.

By the end of 2023, roughly 15 states had adopted the 2021 IECC (or stricter), another ~15 states were on the 2018 IECC, around ~10 on the 2015 IECC, and only a few on 2012/2009 (with the rest having no set requirement). This distribution is shown conceptually in the figure above (orange bars). The “energy code adoption trends USA” show clearly that states in the Northeast, West Coast, and some Midwest are pushing forward with the latest efficiency standards, while much of the Southeast and some central states are holding onto older codes. The gap is dramatic: a new house built in Massachusetts or California under 2021 IECC will be roughly 30–40% more energy efficient than one built to the 2009/2012 code still used in parts of the South. This has implications for operating costs and emissions – and also means that developers in lagging-code states could face steeper upgrades whenever those states do decide to catch up.

Looking ahead, virtually no state has fully adopted the 2024 IECC yet (as of late 2024). Energy code adoption tends to lag a bit behind building code adoption. States such as California, Washington, New York, Colorado, and Oregon are reviewing the 2024 IECC, and likely will incorporate its provisions (or even more stringent ones) in 2025 or 2026. California, for example, updates its Title 24 energy code on a three-year cycle; the 2022 Title 24 (in effect 2023) is roughly on par with IECC 2021+, and the next 2025 edition will likely align with or exceed IECC 2024. New York’s planned 2025 code will effectively bring in 2024 IECC standards. Washington State attempted to implement an aggressive 2021 energy code targeting net-zero ready homes, and will likely embrace 2024 IECC features as well. On the other hand, states that only recently moved to 2018 or 2021 IECC may hold off on 2024 for a few years, and states with no energy code could remain without one unless federal pressure mounts.

In summary, the U.S. presents a patchwork map of code adoption: roughly half the country is on the latest generation codes (IBC 2021/IECC 2021 or newer), while others are one or two cycles behind, and a minority either have no statewide enforcement or are on decade-old codes. This divergence creates very different design and compliance environments depending on the state – something developers and investors must account for when planning projects in multiple states.

Strategic Implications for Developers and Investors

Divergent building code adoption has tangible impacts on project design, timelines, and financial performance. From an architectural perspective, newer codes impose additional design requirements and constraints (but also opportunities for innovation). From a financial perspective, code stringency affects construction costs, operational savings, and even investment risk profiles. Below we discuss key implications of the 2021–2024 IBC/IECC adoption trends for developers and investors, considering both design/engineering and cost/market factors.

Design and Construction Impacts

For developers and design teams, a state’s code adoption dictates important design constraints and necessitates different strategies:

• Structural and Safety Design: States on the 2021 or 2024 IBC will require designs to meet the latest structural loads and safety features. For example, if you’re developing in a state that adopted 2024 IBC, you may need to incorporate tornado-resistant design for essential facilities in certain regions – potentially adding fortified safe rooms or using tougher connections. You’ll also need to plan for carbon monoxide detection throughout all occupancies, meaning additional electrical and alarm system integration in building types that previously didn’t require CO monitors (like offices or retail). These are lifesaving features but must be integrated early in design. In states still on older IBC editions, those requirements might not apply yet, potentially simplifying design – but at the cost of lower safety margins (something developers might choose to voluntarily improve upon as a selling point).

• Fire Protection During Construction: As noted, the 2024 IBC demands a formal construction fire safety plan. Developers building in states adopting it will need to budget time to prepare that plan and assign a safety director during construction. This could slightly lengthen pre-construction planning but yields safer sites. In states on older codes, these measures might not be mandated, but savvy developers may implement them anyway to reduce fire risk and insurance premiums.

• Architectural Planning and Occupancy Use: Newer codes often expand or refine definitions for space usage. Under 2024 IBC’s updated plumbing code, for instance, a developer of a medical office building must account for additional restroom facilities if it includes outpatient surgical suites (since those are now classified separately with higher fixture counts). This might mean dedicating more floor area to plumbing cores than under the 2021 code. Such nuances in code can influence space planning, occupant loads, exit widths, HVAC zoning, etc. in the design process. Designers need to stay abreast of which code edition will govern their project (especially if a project spans over the time a new code is adopted).

• Energy Efficiency and Building Systems: Perhaps the biggest design impact is with the energy code. In states that have adopted the 2021 or 2024 IECC, architects and engineers must hit very stringent performance targets. This pushes design choices like:

  • Using higher-performance building envelope materials (e.g. triple-pane low-U windows in colder climates, increased continuous insulation).

  • Incorporating advanced HVAC systems (such as energy recovery ventilators, high-efficiency heat pumps, smart controls) to meet efficiency mandates.

  • Planning for solar photovoltaic panels or solar-ready roofs to satisfy renewable requirements in 2024 IECC states (e.g. allocating roof space, ensuring structural capacity for PV).

  • Ensuring air-tight construction with detailed air sealing strategies to meet tighter blower-door test thresholds. This can affect everything from the selection of weather barriers to construction sequencing and quality control.

  • Providing infrastructure for future electrification: Even if not explicitly required, the trend in advanced codes is toward electric heating and EV charging readiness. Developers in progressive-code states often include electric vehicle charging provisions, conduits for future solar, and designs that minimize use of natural gas to align with code trajectories and local carbon policies.

These design considerations can increase upfront work and require integrated design approaches. However, they also spur innovation – architects and engineers in high-code states are employing new technologies (like geoexchange HVAC, integrated renewables, smart building controls) as standard practice to comply and even exceed code for programs like LEED or net-zero readiness. In contrast, projects in states with older codes have more leeway to use conventional, less-efficient designs – but doing so may produce buildings that age quickly or miss out on performance gains.

Finally, multi-state developers must be agile: a prototype building design that works in a state enforcing 2015 codes might not pass code in a state that adopted 2021 codes. For example, a multifamily residential prototype may need thicker walls and upgraded HVAC in one state but not another. This can influence decisions on standardization versus localization of design. Many national developers now proactively design to a higher “internal standard” (e.g. designing to IECC 2021 even if building in an IECC 2015 state) to future-proof their buildings and streamline model use. This strategy can reduce the need for redesign when lagging states eventually update codes.

Financial and Investment Impacts

From an investor’s perspective, building code adoption affects both costs and risks/rewards:

• Construction and Compliance Costs: Newer codes generally raise initial construction costs, as more robust materials and systems are required. A 2024 IECC-compliant home might cost a builder a few percent more in construction compared to a 2009-code home (due to better insulation, windows, efficient HVAC, etc.). A cost study by NAHB’s research arm found the 2024 IECC’s new provisions add construction cost, but also noted that thanks to its flexibility, the 2024 IECC can actually lower certain costs compared to the 2021 IECC for the same efficiency level. Regardless, developers must budget for code compliance: high-efficiency mechanical systems, commissioning of HVAC and lighting (which 2021+ IECC requires for larger buildings), extra permitting steps (like energy code documentation or blower door tests), and potentially slower permitting if authorities are learning the new code. In states that lag on code updates, upfront construction can be cheaper – for example, a warehouse built in a state on the 2009 IECC can get away with minimal insulation and older lighting tech, saving money initially. However, there’s a trade-off: operational costs will be higher (the owner or tenants pay more for energy over time), and there is a “risk of retrofit” – if the state jumps to a newer code or if future legislation (like emissions caps) comes, that building might require expensive upgrades.

• Operating Costs and Asset Performance: One clear reward of stricter codes is significantly lower utility costs and often better building performance. Investors in properties built to 2021/2024 IECC will benefit from energy savings that can improve net operating income (for instance, a commercial building using 15–20% less energy will save on utility bills, which can either boost the owner’s profits or make the property more attractive to tenants due to lower CAM costs). Over a long holding period, these savings accumulate. Additionally, energy-efficient buildings often have better comfort and may attract higher rents or occupancy rates from sustainability-conscious tenants (e.g. large companies with ESG goals). Thus, while compliance cost is higher, the investment yield can be better in the long run, especially if energy prices rise or carbon pricing is implemented.

• Incentives and Financing: Many jurisdictions and utilities offer financial incentives for buildings that meet the latest energy codes or beyond. Developers in states adopting the 2021/2024 IECC may tap utility rebate programs for high-efficiency equipment, tax credits for solar panels (federal ITC), or accelerated permitting for green buildings. Additionally, an emerging factor is green financing: Lenders and investors (like green bonds, ESG funds) increasingly favor efficient, low-carbon projects. A building that complies with a stringent code can more easily qualify for programs like Fannie Mae’s Green Financing or other green building certifications. This can reduce financing costs or improve valuations. In slower-code states, these opportunities might be missed unless the developer voluntarily builds above code.

• Market Risk and Demand: There is a market risk associated with being in a state that falls far behind on codes: as sustainability and resilience become more important to investors, portfolios concentrated in lagging states might be viewed as riskier. For example, insurance firms and rating agencies are starting to consider climate resilience – a building in a hurricane-prone state that hasn’t adopted recent wind load standards might suffer greater damage in a storm (and indeed, data shows modern codes greatly reduce hurricane losses). This can affect insurance premiums and the residual value of the asset. Likewise, from a climate policy standpoint, states and cities are increasingly implementing their own efficiency or emission requirements (e.g. New York City’s Local Law 97 limits building carbon emissions). If you own a building in a state with weak codes but a city or future law imposes higher standards, you may face retrofit costs. Thus, investment risk is higher for assets built to outdated codes – they could become obsolete faster or incur compliance costs later. On the other hand, building to a higher standard than required can mitigate these risks. Some forward-looking developers essentially “future-proof” their buildings, knowing that energy code adoption trends inevitably point upward.

• Timing and Project Schedules: Investors also care about delivery timelines. When a new code is adopted in a state, there is often a grace period or specific date when it becomes mandatory. Developers sometimes rush to submit plans before the new code kicks in (to be reviewed under the older code) or, conversely, may choose to delay to align with new code for marketing reasons. Being caught off-guard by a code change can cause redesign and delays. Thus, tracking state code adoption timelines is an important part of risk management for development schedules. For example, if a state announces that IBC/IECC 2024 will be effective next year, a developer might accelerate permitting to use the 2018/2021 codes if their design is not ready for the newer requirements – or they must budget time and cost for updating plans. A recent case is North Carolina’s delay of the 2024 code implementation to 2025; developers in NC gained extra time under older codes, affecting short-term strategy.

• Geographical Investment Decisions: At a macro level, code environments can influence where capital flows. Some investors may prefer markets with predictable, up-to-date codes (seeing them as lower risk for long-term asset performance and safety). Others may seek markets with less stringent codes to potentially save on construction – for example, some industrial developers have cited the Southeast’s relatively lax energy codes as one factor for building big warehouses there versus in the Northeast. However, any short-term savings could be offset if those states eventually raise standards or if tenants (who increasingly have corporate sustainability mandates) demand better-performing buildings. There’s also reputational and liability considerations – developing in a state with very outdated life-safety codes could pose liability risks if something goes wrong that modern codes would have mitigated. Most reputable developers will still build to a high safety standard regardless of minimum code.

In essence, “building code investment impact” boils down to balancing the cost to build versus the value and risk of the asset over time. Savvy investors view strong codes not just as a cost, but as adding resilience and efficiency that protect their investment. Conversely, weak codes might mean cheaper build, but carry hidden future costs and vulnerabilities.

Navigating the Future

Both developers and investors should actively monitor code adoption trends through 2024 and beyond. With the 2024 IBC and IECC now published, we anticipate a new wave of state adoptions in 2025–2027. Many states will likely adopt the 2024 IBC within the next 2 years (continuing the cycle), and some will take up the 2024 IECC or alternative state energy codes aiming for similar outcomes (like Washington’s zero-carbon code goals or New York’s pending energy code update). The model codes themselves are pointing toward net-zero buildings by the early 2030s, meaning each cycle brings us closer to buildings that produce as much energy as they consume.

For developers, early engagement with code officials and perhaps even participating in code development (through public comment) can offer a competitive edge. Those who understand the direction of codes can position their projects and portfolios to meet new requirements with minimal friction. For example, knowing that the 2024 IECC will likely require solar panels on large commercial roofs, a developer can start integrating that into pro formas now, even in states that haven’t adopted it yet – this kind of foresight can make projects more attractive to investors who are eyeing long-term energy performance.

Investors, on the other hand, may incorporate code considerations into due diligence. When acquiring a property, asking “what code was this built under?” and “what code upgrades might soon be required?” is wise. A building completed in 2010 in a state that has since adopted much stricter codes might become subject to retrofit mandates (for instance, some cities require older buildings to be retro-commissioned or brought up toward newer code efficiency levels). If an asset doesn’t at least partially meet newer codes, capital expenditures may be needed down the line to maintain its competitiveness or comply with new ordinances.

In conclusion, the period from 2021 to 2024 has been pivotal for U.S. building codes – seeing a big push in energy performance and new safety features – and the uneven adoption map reflects America’s federal nature, with each state charting its own course. Developers and investors must navigate this landscape strategically: know the codes, plan for the stricter standards (they’re coming sooner or later), and capitalize on the benefits (from energy savings to marketing a high-performance building) that modern codes provide. By aligning development practices with the latest IBC and IECC editions, even ahead of mandatory adoption, industry players can reduce risk and contribute to the broader goals of safety, resilience, and sustainability in the built environment.

Sources:

1. ICC, International Codes – Adoption by State (Jan 2024)

2. ANSI Blog, 2024 International Building Code Overview

3. DBR Engineering, 2024 Code Updates Summary

4. Rescheck Review, 2024 IECC Changes & State Adoption

5. Cove.tool, List of U.S. State Energy Codes (2024)

6. NAHB, State Adoption of 2021 IECC

7. IBHS, Building Codes by State

8. North Carolina OSFM, Press Release on 2024 Code Delay

9. Medium (Green Home Builder), 2024 IECC Cost Savings

10. NEEP, Energy Code Progress (NY skip to 2024)

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