Monday Morning Briefing Letter - 04/13/2009 (Plain Text Version)

By Joe Robson, NAHB Chairman and
Jerry Howard, NAHB President and CEO

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Share your AD&C experiences

with NAHB via our newly created online form that lets you quickly plug in information that is sorely needed to help tackle the ongoing credit crunch.

Last week, this report told you about NAHB’s new action plan to address the problems that home builders and land developers are experiencing in obtaining and maintaining acquisition, development and construction (AD&C) financing. A central part of this plan depends on feedback from members like you. Specifically, NAHB needs to create compelling and documented case studies that we can share with federal regulators, legislators and others to powerfully illustrate the situation at hand and what actions are necessary to restore an appropriate flow of credit. We now have an excellent new channel for you to provide the information that's needed. This template is publicized on the NAHB.org home page and is located at: www.nahb.org/adccasestudy.* NAHB is also promoting the channel and the need for member feedback on AD&C problems via our grassroots network and other NAHB communications vehicles. Contact: John Dimitri, x8529.

*Note: you must be logged into the NAHB.org Web site as a member to view the front page promotion and feedback form.

The best housing affordability in decades

is helping draw more buyers back to the marketplace and is a very hopeful sign for the spring home buying season. Newly released figures by NAHB reveal that – thanks to record low mortgage rates and declining home prices – 55 million families (that's about half of all U.S. households) can afford today's $200,000 median-priced new home. This represents an increase of 17 million households from conditions just two years ago. In fact, data from the U.S. Census Bureau comparing home prices, mortgage rates and minimum income needed to purchase a median-priced home in February 2007 and February 2009 shows that families today can purchase a house with $20,000 less in household income and save nearly $500 per month on their principal, interest and insurance. Such improved affordability has builders in the field reporting increased foot traffic in new homes and rising consumer interest with each passing day. And with single-family housing permits up 11% in February while both new- and existing-home sales also posted gains, indications are good that the market may finally be on the brink of a turnaround. Yet another positive indicator is the fact that NAHB's special Web site devoted to explaining and promoting the first-time home buyer tax credit to consumers, at www.federalhousingtaxcredit.com, received about 1.5 million visitors in the past two months, a sign that more people are finding out about the credit and considering taking advantage of it.

Bottom line: With home values in many markets at the lowest level since 2003, an $8,000 tax credit available to first-time buyers, fixed-rate mortgages under 5% and an outstanding selection of homes to choose from, buyers are starting to recognize that this has the makings of a one-time opportunity to break into the market. Meanwhile, NAHB is reminding policymakers and the public of the critical role that housing plays in the economy. It's important to note that increased housing production and sales will generate significant growth in jobs, wages and state and local tax revenues. Read more about it in NAHB's press release from April 7. Contact: Jay Shackford, x8406. [return to top]

Recent changes to the ESA consultation process

prompted a sharply worded letter from NAHB President and CEO Jerry Howard to Secretary of the Interior Ken Salazar this week. Jerry urged the Cabinet official "to play a strong role in clarifying and limiting these actions" so that the consultation process continues and the home building industry isn't hampered by additional costly delays. "There has long been a need for improving the consultation process of the Endangered Species Act while maintaining adequate protection for federally listed species," Jerry noted, adding that regulations promulgated by the Bush Administration before it left office sought to balance those needs by clarifying and limiting mandatory consultation. He also urged the Secretary to determine a definite period of time by which a decision will be reached on issuing a new rulemaking on consultations, and asked for guidance on how projects currently in the consultation process will move forward during the review period. Moreover, said Jerry, NAHB does not believe revoking legally issued rules without providing an opportunity for public notice and comment is prudent or consistent with the President's pledge to conduct the business of the American people in an open and transparent manner. Get more details in the next NBN Online, or contact Mike Mittelholzer, x8660. [return to top]

North Dakota’s home buyers can decide for themselves

whether to install residential fire sprinklers in their newly built residences, thanks to a recently signed piece of legislation in that state. On April 8, Gov. John Hoeven signed SB 2354 into law, which states that:

"Neither the state building code nor a building code adopted by a city, township, or county may include a requirement that fire sprinklers be installed in a single family dwelling or a residential building that contains no more than two dwelling units.”

The bill passed in its original form, and was not amended by either chamber of state government. NAHB congratulates the North Dakota Association of Builders and our locals across the state for successfully promoting this legislation that protects consumers’ ability to choose what additional equipment to install in their homes beyond today’s highly effective smoke alarms. Contact: Steve Orlowski (x8303). [return to top]

Free guides and resources on energy-efficiency tax credits

are available from NAHB to help remodelers explain these recently expanded benefits to prospective customers who are considering energy-efficiency upgrades. In all, the 30% federal energy-efficiency tax credits are expected to generate about $6 billion in green renovation projects through 2010, say congressional economists. Now you can download a free fact sheet and other resources developed by the NAHB Remodelers. This sheet explains the tax credits for which home owners are eligible when they install energy-efficient heating and air conditioning systems, windows and doors, new insulation and other products that improve energy efficiency. Remodelers have the option of adding their company's logo to this fact sheet and creating a marketing flyer for prospective customers. In addition, remodelers and consumers can visit www.nahb.org/efficiencytaxcredit for more detailed information on all products that qualify for the tax credit. This site updates and corrects information orginally available through the Energy Star Web site, and encourages home owners to contact an NAHB remodeler for expert advice by pointing them to NAHB's Directory of Professional Remodelers. Contact: Kelly Mack, x8451. [return to top]

The first green-certified community

to be verified and officially designated under the National Green Building Standard is the Village in Burns Harbor, located in Northwest Indiana. The 60-acre parcel was carved from unused farm fields and old commercial sites in the once-dying steel town of Burns Harbor. In creating this neo-traditional community, developer T. Clifford Fleming protected environmentally sensitive areas, preserving existing vegetation and the natural water and drainage features on the site while adding more plants native to the Upper Midwest. The high-density residential areas are connected by sidewalk to a town center, with two South Side railroad line stations located less than five miles away (the development is about an hour from Chicago by train). Upon completion, the community wil include a mix of 265 single-family, semi-detached and multifamily homes and a town center with retail, residential and office components. Among 60 homes that have already been completed, two that were built by Coolman Communities have already been certified by the NAHB National Green Building Program. This first official "green" community marks the latest step forward as the nation's home builders continue to move green building practices into the mainstream. Read more in NAHB's press release. Contact: Blake Smith, x8583 [return to top]

A temporary setback for fair housing

is the result of a long-anticipated court ruling on April 2 in a lawsuit against the City of Kyle, TX. The suit was a joint effort by the NAACP, the Austin Branch of the NAACP, the HBA of Greater Austin and NAHB. Together, we claimed that the municipality's new development and building requirements pushed up the cost of housing, with a disproportionate impact on low-income minority families. Unfortunately, Judge Lee Yeakel ruled that "a dollar impact on home construction costs alone" does not establish a case of discrimination under the federal Fair Housing Act. However, the fact that this judge allowed home building associations to bring fair housing claims in court is a huge step forward for the industry. And while we are disappointed in the ruling, NAHB remains committed to working with the NAACP and ensuring that government actions do not deny safe, decent and affordable housing for all people. Read more in NBN Online, or contact Mary Lynn Huett, x8485. [return to top]