Last year, home builders couldn’t buy land and lots fast enough. If we heard of available land, there was a stampede to be the first one to produce a cash deposit. Negotiating terms with the seller was not even considered. Home builders would jump through any hoop just to have the option to buy more lots.

What a difference a year makes! Supply now exceeds demand. What was maybe a two-year inventory last year will now last upwards of five years. You already have too many lots and you don’t want more, but what do you do with land under contract that you don’t own yet? There are many stories of builders walking away from substantial deposits, incurring large losses on their financial statements. It hurts to think about abandoning money, but holding lots that you don’t need may be continuing down a losing path as well.

The Sunk Cost Fallacy

Many builders are reluctant to even consider walking away from a contract. They already have invested significant time and effort, not to mention the money they will lose. When we have put effort and money into something, we are often reluctant to pull out, even if staying the course will lead to an even greater loss. Our thinking goes, “I can’t stop now; I’ll lose everything I’ve invested so far!” This is known as the “sunk cost fallacy. ” While you may lose money, that is not relevant. Fear of loss is an emotional response, but not a reasonable response to the business climate.

There are better ways to evaluate whether to stay the course or cut your losses. [return to top]

Don’t have a survey? 

Go to: http://www.nahb.org/fileUpload_details.aspx?contentID=75376 … print out the survey, fill it out and fax back to the toll-free number on the survey.

If you have any questions about the Cost of Doing Business Survey or want your survey e-mailed to you, please contact Wil Heslop at 800-368-5242 x8472 or wheslop@nahb.com. [return to top]

If one of your jobsites were visited today by a Compliance Safety and Health Officer (CSHO) from the Occupational Safety and Health Administration (OSHA), would it qualify for a “focused inspection”? Or would it be subject to a comprehensive inspection? 

Four Safety Hazards Cause 90% of Deaths, Injuries

A CSHO will be looking for violations and potential hazards. If your company has (1) an effective written safety program, and (2) a designated competent person responsible for and capable of implementing your safety program, then your jobsite may be eligible to have a “focused inspection.” That’s great, because the inspection will concentrate on looking for violations associated with the four main safety hazards that cause approximately 90% of workplace deaths and injuries in residential construction. These four are:

The CSHO determines which projects are eligible for focused inspections. On jobsites where OSHA determines that there is inadequate contractor commitment to safety and health, a comprehensive, resource-intensive inspection will be made. In other words, the latter group of employers will receive OSHA’s full attention.

Have a Written Safety, Health Program

An effective safety and health program starts at the top, with management commitment to a “zero-accident” goal that begins with the owner of the company and is embraced by all of its employees. Having a written safety and health program is the next step. The program should explain the company’s commitment to safety and how employees and trade partners also are responsible for integrating safety into every aspect of their jobs.

Read more. [return to top]

The Home Technology Alliance seeks to offer education and information to home builders about options for integrating home automation in both new home planning and construction, and in remodeling of existing structures. As part of the effort, new resources under development include:

• Monthly e-newsletter (www.nahb.org/HTANews) with articles, news, tips and links to resources.
• Special section on http://www.nahb.org/ dedicated to home technology including a link to CEDIA’s Electronic Systems Contractor Directory.
• Educational sessions to at the International Builders’ Show, Custom Builder Symposium, and other NAHB conferences.

The NAHB-CEDIA partnership was announced last month at the Electronic Lifestyles Conference in Las Vegas in recognition of growing consumer interest in home technology applications. With new and emerging applications for home automation spanning everything from theaters and electronic gaming to security and home health care, home technology installations are expected to expand to a $9.6 billion business in 2007.

“Builders need to keep up to date and continually be educated about this ever-evolving technology,” said Alex Hannigan, chair of NAHB’s Custom Home Builders Committee, which will oversee this new joint effort. “We are delighted to have CEDIA as the founding sponsor of this forward looking initiative,” he said.

Helping Builders Answer Consumer Demand

“The Home Technology Alliance is the next logical step in bridging the gap between increasing consumer demand for technology-driven amenities and the residential building industry,” said Utz Baldwin, vice president of CEDIA. “This new alliance is designed to engage NAHB and CEDIA members, and deliver programs to demystify the fastest changing segment of the home building industry.

“Electronic Systems Contractors are emerging as not only a primary trade, but also a core component of the building design team,” Mr. Baldwin said. “NAHB and CEDIA are logically positioned to capture their expertise and offer builders, architects, and designers a new resource to learn about the features, benefits, best practices, and design considerations associated with emerging home technologies,” he said.

The Home Technology Alliance will be housed at NAHB. The alliance will provide education, resources, tools, and product and service information to builders in the areas of electronic systems integration and home technology.

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You won’t find these “treasures” anywhere else.

Reserve your spot at this unique educational and networking event so you can take advantage of the great sessions, home tour, golf tournament, Custom Home Builder of the Year Award dinner and all the other excellent networking opportunities available to you when you register and attend the only national event for custom home builders like you. 

Registration is open now, so why not take a moment to “Discover Hidden Treasures” and reserve your ticket to this world-class educational and networking event.

Tell a friend – The Custom Builder Symposium is more valuable and enjoyable when you’re surrounded by friends and colleagues … just point them to www.nahb.org/custom so that they too can “Discover Hidden Treasures!” [return to top]

Specifically, the legislation does the following:

• Extends the placed-in-service deadlines for properties that received an allocation of Low Income Housing Tax Credits (housing credits) within the GO Zone, Rita and Wilma GO Zones in 2006, 2007 or 2008 to Dec. 31, 2010.
• Extends the difficult-to-develop-area designations in this same area until Dec. 31, 2010.
• Allows properties in this area that are placed-in-service by Dec. 31, 2010 to use 9 percent housing credits with “disaster relief” Community Development Block Grant funds loaned at below-market rates.
• Waives the Mortgage Revenue Bond program’s 20-year and existing walls rules for qualified rehabilitation in the GO Zone, Rita and Wilma GO Zones for owner financing provided after enactment and before Jan. 1, 2011.
• Requires the Government Accountability Office to study the practices employed by state and local governments in allocating and utilizing tax incentives provided as part of the GO Zone Act of 2005 and to report to Congress on its findings within one year of enactment.

The small business tax package was included as part of Supplemental Appropriations legislation intended to provide funding for the military and the war in Iraq.  While that legislation was vetoed by President Bush because of language calling for a date certain for U.S. forces to withdraw from Iraq. A smaller bill was expected to be sent to the president for his signature, and it appeared the tax package as well as the GO Zone provisions would be included in this second, smaller bill.  If not, tax writers have committed to moving the package separately. For more information, e-mail Greg Brown or call him at 800-368-5242, x8421. [return to top]

BuilderLink

By developing local grassroots activities that bring NAHB members and their members of Congress together throughout the year, BuilderLink will build on the momentum generated by the annual NAHB conference, which is expected to draw more than 1,000 builders to Capitol Hill to share their concerns on housing-related issues with their representatives and senators.

BuilderLink will pinpoint members of Congress who have the most influence over priority housing issues and link them to the NAHB members living in the areas they represent. As constituents, NAHB members are in a unique position to directly communicate with their federal lawmakers on the impact of their decisions on housing.

Whether conducting a local visit, writing a letter or making a phone call to a member of Congress, BuilderLink will provide the resources NAHB members need to advocate a pro-housing message.

“Members of Congress need to hear from the men and women in the building industry — their constituents — about the impact federal policies have on their livelihood,” said Michael Sivage, chairman of the NAHB Federal Government Affairs Committee. “BuilderLink gives NAHB members the tools they need to develop relationships with federal lawmakers and make their voices heard.”

For more information on BuilderLink, click here, or e-mail Molly Murray at NAHB, or call her at 800-368-5242 x8470. [return to top]

Using the Survey of Consumer Finance data from two periods, 1989 (a peak economic year) to 2004 (a mid-recovery year) and 1992 (an early recovery year) to 2004 (a mid-recovery year), the research tracked both income and wealth for business-owning and non-business owning households. The study concluded:

• Families owning businesses remained significantly more likely to be high income earners and high wealth holders than families not owning businesses.
• Income and wealth for households owning businesses are more sensitive to economic fluctuations.
• Contrary to the period of 1989 to 2001, growth in income and wealth for small business owners between 1992 and 2004 was comparable to that for non-business owners.
• Owners of multiple businesses appeared to be the most prosperous small business group.

Between 1989 and 2004, the income gap between households with and without a business widened, and the wealth gap narrowed. Small business owning households were a little more than two times more likely to be classified as high income (55% vs. 25%) and about seven times more likely to be classified as high wealth (20% vs. 3%).

Households owning a small business realized a real mean income increase from $139,040 to $142,559, or 2.5% between 1989 and 2004. Between 1992 and 2004, households owning a small business realized a real mean income increase of 44%, compared with 31% for those not owning a business. Real mean income for all household types, including business-owning and non-business-owning households, was $60,150 in 1989 and $69,629 in 2004.

Multiple business owners appeared to be the most prosperous, with nearly three-quarters of them classified as high income and nearly half classified as high wealth.

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These aren’t reviews for the latest summer blockbuster—it’s feedback from recent participants in NAHB’s Spokesperson Training seminars. One attendee even admitted it was the best eight hours of education he had spent in education—ever!

If you missed the popular training program at IBS, Spokesperson Training will be available once more at the Spring Board in Washington, DC. Registration is now open and the seminars fill up quickly, so sign up today!

Spokesperson Training Seminars help NAHB leaders be more persuasive and effective in all communication environments, and in particular, in media interviews and during speeches and other presentations. More than 15,000 NAHB leaders have taken one or both of the Spokesperson Training Seminars since the program began in 1979. They are led by professional communication consultants, each with more than 30 years of experience training NAHB members on the issues that home builders, HBA staff, and affiliate members face every day. 

The Interview Skills seminar helps participants master strategies for broadcast and print interviews, including message development.  The Presentations Skills seminar focuses on how to organize and deliver a speech or presentation and handle Q&A. Each 7 ½ hour seminar is limited to 12 participants and includes instruction, skill-building exercises and on-camera practice interviews/presentations.

The registration fee is $475.00 per person for each one-day seminar. Registrations are accepted on a first-come, first-served basis. To reserve your space, contact NAHB Public Affairs, at (800) 368-5242, x8061, or email nclark@nahb.com.

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GM's extensive vehicle lineup includes the all-new 2007 Chevy Silverado and GMC Sierra, both redesigned to tow more than before and stop less at the pump.

For complete details, visit www.gmfleet.com/nahb.

Other Member Advantage Discounts

For the most up-to-date details on the Member Advantage discount program and all of the participating companies, go to www.nahb.org/ma.

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After reviewing survey results and feedback from the first phase of the program, which offered $1 million in assistance, the NAHB Senior Officers approved the remaining $2 million in funding at their recent Executive Board meeting in Las Vegas.

In late March, NAHB Public Affairs began surveying members whose campaigns were well under way in order to evaluate the success of the initial $1 million. The results were overwhelmingly positive.

Ringing endorsement from members

More than three-quarters of respondents rated their association’s “buy now” campaign “effective.” An equally high number—78%—said that their campaign delivered a credible “buy now” message. The majority responded that the campaign had started to help change home buyer attitudes in their marketplace. Seventy-eight percent reported that members of their industry and community viewed the campaign positively.

NAHB launched the grant program to assist local HBAs in an effort to bolster home sales in markets hit hard by the current housing downturn and help offset the cost of local ad campaigns.

87 HBAs received funds

Fifty-one local associations applied for and received $1 million in advertising assistance as part of the first phase of the program. Including the matching funds that HBAs contributed, the total value of their campaigns is $3.5 million. With the release of the additional money, 36 more local associations have now been funded. This brings the total of funding distributed to $1.7 million, with campaigns totaling $5.3 million. To date, 87 HBAs have received funding.

The NAHB “Buy Now” Advertising Assistance Program provides grants to qualifying HBAs in three categories:

HBAs conducting ad campaigns in the top 10 media markets can receive assistance equaling up to one-third of the total cost of the campaign, with a maximum NAHB contribution of $75,000. For example, an HBA conducting a campaign with a total cost of $225,000 could receive a $75,000 contribution from NAHB and the HBA would only pay the remaining $150,000.

HBAs with more than 250 members operating in areas outside of the top 10 major media markets can qualify for matching grants up to a maximum of $40,000, and be required to pay for at least half the cost of the campaign.

HBAs with 250 or fewer members can qualify for grants of up to $5,000 with no matching requirement.

To qualify for grants, the ads must deliver a “buy now” message, be placed in 2007, and the campaign must be conducted in markets that have experienced a major decline in home sales and housing production.

HBAs that applied and were eligible for the first phase, but did not receive grants from the initial $1 million, will be contacted by NAHB soon regarding their application and eligibility for the second phase. Associations that already have received matching grant money are not eligible for the second phase.

To learn more about the program, eligibility considerations and requirements, visit http://www.nahb.org/generic.aspx?genericContentID=71280, or call Niki Clark at 800-368-5242 x806l.

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NAHB has developed the toolkit to help members highlight positive messages about the home building industry and provide consumers with information on the benefits of homeownership.

Members are encouraged to distribute the information in this kit to their local news media throughout June or anytime throughout the year, and to use the ready-to-use articles in their promotional material for Home Shows, Parade of Homes or other special events.

NAHB’s National Homeownership Month promotional kit includes:

• Talking points on why it’s a great time for homeownership
• “National Homeownership Month” press release
• Economic and housing data
• “National Homeownership Month” proclamation
• Questions and answers to counter negative perceptions of market conditions
• Ready-to-use print and radio advertisements
• Articles you can use in your client communications

For More Information or the Free Promotional Kit

For more information, or to download your free homeownership month promotional material, visit http://www.nahb.org/homeownershipmonth.

For additional information, e-mail Niki Clark at NAHB, or call her 800-368-5242 x8061. [return to top]