Hi- We are in the process of building so we've just gone through this. There are some that think cellulose is "green" but it has to be processed anyway, so there are definitely chemicals in it. We went with the foam because it makes the house so much tighter. Regardless of which you go with, you should look at an air exchanger to increase air flow in the house (it's very energy efficient). The air exchanger will also address the moisture...hope this helps.

The chemicals in cellulose are typically borax (which helps with mold and bugs) and a water based glue to make it sticky when sprayed. The product itself is recycled newspaper. It has been around for many years and is safe.

If you can afford the foam, get that since it is the best at blocking air infiltration. But if you cannot afford the foam, and assuming you have 2x6 studs, blown cellulose is not a bad choice. If you have 2x4 stud walls, go with the foam.

With such a tight house, An energy recovery vent (ERV) and a whole house dehumidifier would be worth looking into. I live in the mid atlantic region and will be installing an ERV in the spring (I put the dehumidifier in last summer). The builder told me we didn't need and ERV - he was wrong!

The builder also never mentioned the possible need for a dehumidifier and we ran into a moisture problem in our basement during very humid days when the temperature was too low to cause the AC to come on. Got a musty smell and the dehumidifier fixed that right away. Go that tip off the GW in the basements forum (check out posts by "worthy" on this subject).

I would look on the HVAC forum for info in ERVs and HRVs to learn more about them. Also look into IAQ contols which are just fancy thermostats that control HVAC, ERVs, and dehumidifiers all from one thermostat. That is what I will be putting in later this summer.

Good luck.

"The chemicals in cellulose are typically borax (which helps with mold and bugs)..."

The borax is also the fire retardant.

I should have added that foam is a premium product and cost is the only reason I have used it sparingly--in basements, in garage ceilings with living space above, rims and others hard-to-reach spots.

This is what I would do sharron.
install on exterior of wall 1/2" rigid closed cell insulation boards on corners over 1/2" plywood, 1" foam insulation boards on all walls. tape all seams, nail with proper nailing patterns, repair any holes before exterior cladding. if you are using a brick exterior opt for the foil foam faced sheating boards, foil will act as radaint barrier behind air space of brick.

These sheating boards are air and water barrier. if housewrap is used install it next to studs under foam boards. (note that is from local utility company's energy design info..it is not necessary but was put in to appease housewrap mfgs)

Near where I live is an insulation company that installs
rockwool in the walls and does an exceptional job. BIBS is
a nice system, even batts will perform much better since air barrier and insulation boards are stopping air flow thru the insulation from the exterior.

Install drywall with air tight drywall approach,
make sure sill plates (sole plates) are sealed when in framing stages.

Pay attention to potential air leakage sites and seal the
leakage areas up.

If you use foam..and this is what I get from conversations with building scientists for our climate..open cell on rooflines. Also walls under floors and attic floors. open cell.

foaming the roofline will help with duct leakage issues..I'm sure you are putting your system in the attic..
another one of those really stupid things we do!
If you choose not to foam the roofline..mastic sealing of ductwork, sealed return air chases, and supply boxes should
be done. (I think is should be done reguardless)
tight homes are more efficient, and thus require less tons of hvac.

this is a problem you may encounter in your dealings with the hvac industry. Bigger is not better.
Bigger costs more upfront, costs more per month to operate and does not dehumidify.
build it tight..ventilate it right.

we have been building homes here for 10 years that I know of with the foam sheating boards, long before foam became flavor of the week. we are achieving .25 air changes per hour and occasionally less. In cases there ach is less than.25 filtered dampered fresh air is brought into return side of hvac system allowing clean, measured, dehumidified air to enter the house when needed.
if you go this route and decide on another method of adding fresh air energy recovery ventilators are for our climate.

Oh and recessed lights (my pet peeve) insulation contact air tight only ICAT not IC. It is all about controlling air flow. IC cans leak like sieves and pull unconditioned air and insulation particles into homes.

Things that you should read up on are flashing windows..
the correct way. www.grace.com has good info.

btw you should read builders guide to hot humid climates
from www.buildingscience.com good stuff.
also you can email joe with specific questions. I do it often.

best of luck.

here is what i will be doing:
double 2x4 exterior wall with staggered studs, will sit on 2x8 sill plate. 2" of spray in foam, to completly seal the structure, additional sealing around openings if needed. also will set sill plate in good bead of foam. than for the rest of the cavity i will use blow in wet celulose. this system will give me airtight structure with R value of around 30-34, with no thermal bridging at studs. u can also do sip panels, but make sure that connection is not done with 2x lumber but with insulated connection pieces to avoid thermal bridge. sips are more costly though and you have to design around them.

We did a combo, a layer of foam and then cellulose in the walls. Blown cellulose in the attic.

I am building a house in Louisiana 2000 sq ft. with 2x6 walls and want to know if foam insulation will be to air tite with the humidity here. Or should i do just cellulose with a wider air space. Or what do you suggest