Steel studs attract moisture, especially in colder climates. If steel studs are not insulated, moisture can accumulate in the frame and then condense on wallboard directly in front of the stud.
The interior walls may develop cold spots (also known as "ghost marks") of moisture, indicating the presence of mold behind the wall. Mold is very expensive to treat and can require tearing down walls.
Some metals, including steel, are coated by manufacturers with oil that can be harmful to persons with petroleum sensitivity. Generally, this oil is easily removed from exposed metal with a non-toxic or a minimally toxic cleaning solution.
There are also health risks related to mold, which tends to grow near steel stud frames that attract moisture in the winter. Mold can cause allergic reactions, coughing and respiratory problems, especially if a person is exposed to mold for a long time.
Steel framing is highly inefficient with energy. Since steel conducts heat, heat is lost to steel stud frames during the winter.
Steel studs transfer heat outside the house 400 times more readily than wood studs, according to the Consumer Energy Center of the California Energy Commission. Many new homes built with steel frames utilize a type of super-insulation, such as a double wall, to counteract the problem of energy loss.
However, super-insulating systems are very pricey.
For many years, steel framing materials were much more costly than lumber materials. More recently, the rising cost of lumber has made the materials more equal in cost.
However, the labor and engineering costs for steel construction far exceed those costs for wood construction. This is because steel construction requires more advanced skills, making it hard to find competitive steel carpenters and builders.
Further, screw construction (used with steel) is much more time-consuming that nail construction (used with wood). Thus, you will have to pay carpenters a higher hourly wage and for many more hours of work.