Wood frame homes have the advantage in energy efficiency, according to "Your Green Home: A Guide to Planning a Healthy, Environmentally Friendly New Home" by Alex Wilson. The problem with a steel frame is the conductivity of metal. This means that it will cost you more money to heat and cool your home because the metal frame is conducting some of that heat outside during the winter and bringing heat from outside in during the summer. To offset this effect of steel, you need to have a rigid foam insulation installed in the walls of your home during construction.
Building materials can have a significant impact on the environment. According to Wilson, steel used in homes is between 20 and 25 recycled, but steel also uses more energy to produce than wood. Wood used in home construction required the cutting down of forests, but timber companies replant the trees they cut. Wood is also susceptible to damage from termites whereas steel will be unaffected.
In a cost comparison study conducted by the United States Department of Housing and Urban Development, two identical homes were built. One home was made with a wood frame and the other had a steel frame. The study found that, with other factors equal, steel-framed houses cost 14.2 percent more to build than wood houses. If you are looking to reduce costs during construction, you should choose a wood-framed house.
Your location can make a steel home more advantageous. In areas prone to earthquakes and hurricanes, steel-framed homes remain intact while wood homes fall. Check with your builder to ensure that the exterior walls of a steel house are braced for added wind and earthquake resistance. If the builder builds a steel home properly, it can rate the highest rating for earthquake resistance in homes – a seismic rating of four, according to "Residential Steel Framing Handbook" by Robert Scharff.