With home-construction permits in Connecticut hitting an eight-year low in April, local builders say they are scrambling for work as never before. “You just have to change with the times and do something a little bit different,” said Chad Whitcomb, president of the Builders Association of Eastern Connecticut. Whitcomb, who as president of Greensulators now spends more time doing energy-conservation work than building, said people are much more leery about making a commitment to a major project than they were a few years ago. And when they do express serious interest in proceeding, he said, many are looking for a bargain. “But our costs haven’t come down,” Whitcomb said. “The only thing we can do is cut our profits. There’s a misnomer that you can get a house for half off.” He added that the industry as a whole may be suffering, but individual companies like Greensulators — which doubled its business last year — can still find a niche and prosper. Still, custom builders who rode the highs of the real estate market a few years ago are itching to get back to what they do best. Many have been forced to take virtually any kind of work — painting, roofing, siding, gutters, maintenance — just to stay in business. “As long as we’re down, the economy is not going to come back,” said Renee Main, executive officer of the local builders association. (www.theday.com)
New London Day (5/31/11); Lee Howard

More than 500 midsize and large cities have seen a rise in the share of homes that are rented rather than owned, according to a USA Today analysis of Census data. Almost 4 million homes have been lost to foreclosures in the past five years, turning many former owner-occupied homes into rentals. Of the 100 largest cities, some of those with the largest shifts were Irvine, Calif., which went from about 40% of occupied homes rented in 2000 to 49.8% in 2010; Philadelphia increased from 40.7% to 45.9%; and Birmingham, Ala., rose from 46.3% to 50.7%. Twenty-five cities — including Baltimore, Minneapolis, Sacramento, Calif., and Salt Lake City — swung from having more than half home owners in 2000 to majorities of renters in 2010. Florida, California and Arizona had the most cities where the share of renter-occupied housing grew by at least five percentage points. All three states have been hard hit by foreclosures. Nationwide, 34.9% of occupied homes were rented in 2010, up from 33.8% in 2000. (www.usatoday.com)
USA Today (5/31/11); Julie Schmit and Barbara Hansen

A new class of renters is expected to bring a bright spot to the troubled U.S. real estate market. Prices for rental apartments are expected to rise nationally — by approximately 4.5% in 2011 and up to another 3% in 2012, according to Rent.com. Charles Brindell, chairman of NAHB’s Multifamily Leadership Board, says he expects apartment construction to pick up to at least 160,000 units this year, mostly in urban areas along the East Coast. This would be significantly higher, given that construction since 2009 has totaled less than 90,000 a year — the lowest in 50 years. Brindell, also CEO of a Texas-based firm that invests and develops apartment communities, says he’s bullish because of the improving job prospects for younger workers. More than 60% of jobs created in 2010 went to workers between 20 to 24 years old — the prime age group for renters. Brindell’s Mill Creek Residential Trust is planning to build 3,000 apartment units this year, mostly in the Northeast, including the Boston area, Long Island, N.Y., and Virginia. (http://money.cnn.com/magazines/fortune/)
Fortune Online (5/25/11); Nin-Hai Tseng

A record number of foreclosure houses in the Phoenix area were sold in April at daily events known as trustee-sale auctions. The number of sales has been growing for months and the record pace is expected to continue through next year. A decade ago, foreclosures were so rare that only a handful of bidders regularly showed up at the trustee-sale auctions. Then after the housing crash, foreclosures and trustee-sale auctions soared, but the public auctions remained dominated by a few insiders. They huddled around auctioneers speaking in whispers. Outsiders found it hard to break into the process. Then the growing number of foreclosures drew more bargain hunters. The increased number of bidders and firms has added competitiveness and more transparency to the auction system. Several firms bid for multiple prospective buyers, so a bidder outside the courthouse may be an agent using a cellular phone and a laptop to communicate with clients from around the world. Newcomers aren’t shunned. Instead, they are looked at as potential clients for the more than half-dozen bidding services that have representatives at the auctions every day. The increased competition for foreclosure homes is pushing up prices, which may bode well for the housing market at large. (www.azcentral.com)
Arizona Republic (5/22/11); Catherine Reagor

More home owners in San Diego County and throughout the U.S. want small makeovers instead of the mega-upgrades of the boom times in 2005-06. They are paying with cash instead of tapping into once-lush home equity lines and plan to stay put for a while in the face of fallen home values. The purpose of remodeling also has changed. In the past, people mainly made alterations and additions to increase home values. Now they’re done more out of necessity: from upgrading to “green” appliances to save on energy costs to adding shower grab bars to make the bath more accessible as home owners age. “If your mortgage is underwater, you can’t borrow,” said Kermit Baker, chief economist for the American Institute of Architects. “That’s a psychological barrier,” he said. “Even if you do have the cash for it, you’ve really scaled back on the work.” For those who are remodeling, three themes have emerged. Home owners are exploring smaller and cheaper improvements, adding “green” upgrades and changing interiors to age in place. (www.signonsandiego.com)
San Diego Union Tribune (5/25/22); Lily Leung

A recent Washington Post article highlights how easy it is to taint an entire portfolio of federal programs by highlighting problems at one. The paper began a series on May 15 on problems in HUD’s HOME program. The article details examples of poor decision-making and a lack of accountability at what it describes as “the federal government’s largest housing construction program for the poor.” A major problem, of course, is that the article has nothing to do with the nation’s public housing program, and there is no effort to distinguish HOME from the plethora of available HUD programs. To be clear, HOME provides block grants to local municipalities, who in turn work with non-profits and private developers to develop affordable housing. (As HUD points out, the article also does not paint a fair picture of the program.) The article implies that public housing is rife with the same kinds of problems, that money is being wasted and that people with unmet housing needs are being ignored. That is simply not the case. Public housing is a multibillion dollar asset that is home to 2.2 million working families, seniors and people with disabilities. Not only is money not being wasted, it is producing an excellent return on investment. A recent report found that using $4 billion of Recovery Act funds invested in public housing capital projects, housing authorities renovated and developed nearly 380,000 sorely needed affordable housing units. Operating costs — particularly for utilities — will be lower in the future. That means a better use of tax dollars and less strain on scarce resources. (www.huffingtonpost.com)
Huffington Post (5/17/11); Sunia Zaterman