Monday Morning Briefing Letter - 06/21/2004 (Plain Text Version)By Bobby Rayburn, NAHB President and View Graphical Version | Subscribe to NAHB Publications | Email our Editor... Touting housing's role in the economy,Bobby shared the stage with Treasury Secretary John Snow and Housing Secretary Alphonso Jackson last week at an event designed to promote the Administration's ongoing economic recovery plan. Appearing at a new-home development called The Verandas at the Peaks in Las Vegas June 18, Bobby predicted that the ongoing economic recovery and job growth will ensure continued strong demand for new housing into the future. We credited Secretary Snow as one of the prime architects of the President's recovery plan, and thanked him for his efforts to promote the NAHB-supported Homeownership Tax Credit in the current Congress. This credit would stimulate construction of 50,000 new or rehabilitated homes each year and create 120,000 new jobs annually. We also applauded HUD Secretary Alphonso Jackson for his tireless efforts to promote the FHA Zero Downpayment Mortgage Insurance Program, an effort that would help an estimated 140,000 families become first-time home buyers. Many thanks go to Astoria Homes CEO Joel Laub for hosting this special event that highlighted housing's importance on the national agenda. Shining a spotlight on workforce housing,Bobby addressed the challenges facing builders in high-growth metros during a press conference at the Pacific Coast Builders Conference in San Francisco last week. Increasingly, regulatory barriers to affordable housing — including excessive impact fees, mandatory set-asides and large-lot zoning that rules out higher-densities — are forcing working families to live hours away from their jobs or make do with housing that doesn't meet their needs. Nowhere is this a bigger issue than in California, where forecasts indicate that builders will need to construct about 230,000 homes and apartments annually over the next 10 years just to keep up with demand. Knowing that failure to build enough homes to meet demand will result in moderate- and lower-income workers being priced out of the market, local communities need to summon the political will to make affordable and workforce housing a priority, Bobby said. The San Diego Union-Tribune picked up the story and ran with it. See Bobby's Housing America's Working Families agenda online. [return to top] Testifying before the Democratic Platform Drafting Committeeon June 18, NAHB Advocacy Group V.P. Bill Killmer provided our federation's policy recommendations for a national housing agenda. In particular, he urged the committee to put substantial weight on low-income and workforce housing issues in its final platform. NAHB's blueprint for a national housing agenda focuses on four basic elements. The first is a strong economy with low interest rates, which will increase the purchasing power of working Americans so they can afford to rent and buy decent shelter. The second is reliable financing, for which we must have a dynamic secondary mortgage market led by the housing GSEs. Third is federal government support for special programs and tax incentives that help families buy or rent the kind of home that meets their needs — this includes a homeownership tax credit, zero-downpayment mortgage and appropriate funding for the Low-Income Housing Tax Credit, to name just a few. Finally, we need sound land-use and regulatory policies at the local level, which will require substantial reform in many markets to reduce red-tape barriers such as large-lot zoning, excessive impact fees and mandatory set-asides. See the June 21 NBN Online for testimony details. [return to top] A vote of confidence in Fannie Mae and Freddie Maccame from an unexpected source last week — Federal Reserve Chairman Alan Greenspan. Testifying before Congress as part of his re-confirmation process, Greenspan responded to a question from Senator Richard Shelby (R-AL), a chief proponent of GSE regulatory reform. Shelby asked whether any potential slowing of the housing market — brought on, for example, by rising interest rates — would cause the Chairman to be concerned about the health of Fannie Mae or Freddie Mac. Greenspan's response was an unequivocal "no." He added, "I have no problem with the way they manage their structure of both their portfolio and the securitization parts of their business. I think it is rather well-done. They do a fairly impressive job." Greenspan did reiterate his concern regarding the size and scope of the GSEs, but also acknowledged that "they have slowed their rate of growth recently, and I trust that's the beginning of a conscious trend." [return to top] Residential building continues to fire on all cylinders,according to the latest readings of government housing starts and NAHB's index of builder sentiment. New-home production was down almost imperceptibly in May from a robust and upwardly revised volume in April, the Commerce Department reported June 16. But looking a little closer, single-family starts and permit issuance for single- and multifamily units were up last month. Moreover, according to NAHB's chief economist, David Seiders, average new-home construction is running at or above par with the very solid first quarter and there are no signs of systematic weakening in any region. Single-family building permits actually hit a record high in May. See our release for more information. Meanwhile, builder confidence slipped marginally this month, but remains well above where it was last June — when long-term mortgage rates were at their lowest point in 50 years. NAHB's Housing Market Index, released June 15, fell just two points to 67 this time around. See our release or contact Gopal Ahluwalia (x8480) or Ashok Chaluvadi (x8482) for details. [return to top] Telling consumers how to hire a professional remodeleris the object of a newly published, easily downloadable brochure from NAHB's Remodelors Council. The report guides its readers through the process of locating and interviewing potential remodeling contractors, including finding out what insurance each candidate carries, determining how long the remodeler has been established in the neighborhood and securing references. Of course, remodelers with professional designations are recommended as certified professionals in their trade. Print your free copy of this brochure from NAHB's Web site (it will take a few minutes to download), or contact Melanie Hinton at x8451. [return to top] National Housing Endowment grants have been awardedto the following organizations and projects in recognition of their contributions to the welfare of the housing industry and its patrons. For more information, please see our press release or contact Stacy Hope (x8132). For more information or to contact us directly, please visit www.NAHB.org | ©2004, National Association of Home Builders |