Nation's Building News Online: May 17, 2004

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Florida Reports Cement Shortages; Other Areas Could Be Next

Cement shortages are being reported in Florida and could be appearing soon in other states that also rely on imports for their supply of this vital building material as demand from the housing industry remains high and rising demand from Asia adds new pressure to the marketplace, according to NAHB economists.

China’s booming economy has rapidly created a huge demand for many of the raw materials used in the residential construction market. While only contributing about 4% to global economic activity, China is consuming about 45% of the world’s cement. It is also absorbing disproportionate shares of steel and other metals.

China’s imports of materials and the current strong value of its currency are contributing to material price increases worldwide. Its surging economic growth has also resulted in a shortfall of ships to carry products to the U.S., which appears to be a far bigger factor affecting cement imports to this country from Asia and Europe than foreign cement-making capacity.

As cement supplies tighten in some areas of the United States, Mexico would seem to be the most logical source for additional imports, but there is a prohibitively high anti-dumping duty on cement from that country, which NAHB has opposed. Canada already provides about 25% of the cement imported into the U.S.

“This is likely to continue to be a problem, at least until late this year” said NAHB economist Michael Carliner. “The overheated Chinese economy is due for a major correction, but that hasn’t started yet, and countries like Japan that have been in recession are starting to grow and demand more cement.”

Cement, the key ingredient in concrete, is also a key ingredient in the nation’s housing, being used for everything from foundations, driveways and sidewalks to, in some cases, even the full construction of a home.

NAHB, through its newly formed Concrete Home Building Council, is monitoring the current situation closely to keep home builders informed and to identify ways in which the association can help alleviate the problem.

According to the Portland Cement Association (PCA) in Skokie, IL, the combination of stronger economic growth and favorable winter weather produced a double-digit increase in domestic demand for cement during last year’s fourth quarter. Cement producers typically overproduce during the winter to build inventories for the spring, but unusually high demand during the winter months prevented them from doing so this year.

Florida is the only market to date that has reported widespread delays in concrete deliveries, although there are some indications that similar problems could be developing in other areas. The Florida market is particularly vulnerable to these shortages because it imports about 40% of its cement, compared with a nationwide average of about 22%.

According to PCA, any supply problems that do occur will be regional, with the length and severity of the shortage depending on the cement companies serving that region.

As the population grows, the needs for housing, infrastructure and nonresidential construction will continue to increase the demand for cement. With domestic producers operating at close to capacity, the short-term solution is to import more cement.

But over the longer term, cement companies have announced plans to expand manufacturing capacity by more than 10 million tons by 2008, a roughly 11% increase, according to Ed Sullivan, PCA’s chief economist, and that promises a better balance between supply and demand in the future.

For additional information from PCA’s Web site, click here, or contact Ed Sullivan at 847-972-9006. At NAHB, e-mail Dawn Faull, or call her at 800-368-5242 x8362.

Building News Coast To Coast

Construction Booms Even as Prices for Materials Soar

Soaring steel and lumber prices have boosted the cost of new homes in many cities across the country, tacking about $5,000-$6,000 onto the average price of a 2,000-square-foot dwelling in Anchorage, AK, according to local builder Chuck Spinelli. Economists at NAHB blame robust demand and low production capacity for driving up lumber prices and the building frenzy in China for jumps in the cost of steel. Research by Random Lengths shows a surge in the price of oriented strand board from about $200 per 1,000 square feet to $495 during the year-over-year period ending in April, at the same time the cost of composite framing lumber skyrocketed 58%. Both steel rebar and septic tanks, meanwhile, have risen in price in recent weeks. Nevertheless, building activity remains healthy, with nationwide home sales climbing nearly 22% during the year-over-year period ending in March. Low interest rates, coupled with higher levels of government spending and other factors, continue to fuel the construction boom.
Alaska Journal of Commerce Online (05/10/04): www.alaskajournal.com

Top Housing Markets

National Association of Realtors® Chief Economist David Lereah says the mixed performance of home prices during the first quarter of the year is the result of supply and demand. The trade group reports that 35 of the 126 metropolitan markets tracked registered double-digit price increases over the past year, led by Riverside and San Bernardino Counties near Los Angeles — where home values grew 32.9% to $258,900. Low interest rates helped as the national existing-home price rose 6.5% to a median of $170,800 during the first quarter, and prices were slightly down from $171,600 during the previous quarter. NAR also found declining home prices in 16 markets, led by Springfield, IL, with a 10.2% decline to $84,000 over the past year — which Lereah attributed to struggling local economies rather than to a housing market bubble.
CNNMoney 05/12/04) Max, Sarah: money.cnn.com

Condo Firm to Build Across U.S.

The concept of a national company focusing on condominium development has not been done in this country before, and National Association of Realtors® research executive Ellen Roche speculates that the U.S. housing market might not have supported such an operation as little as five years ago. Now, however, with high-end condos in as much demand as traditional, lower-cost versions, Roche says the timing of Coldwell Banker The Condo Store just might be right to succeed. Founded in 1993 as simply The Condo Store, the firm initially served the suburban Atlanta market. Since acquiring the business five years ago, however, management at Coldwell Banker has been cultivating a strategy for a nationwide expansion. The company already has spread out to markets where Coldwell Banker already does business, including Jacksonville, FL; Boston and Houston. South Florida, Detroit, New York, Charlotte, NC, and Washington, D.C., are future target markets.
Atlanta Business Chronicle Online (05/10/04) Schoolcraft, Lisa R.: www.atlanta.bcentral.com/atlanta

Interest Rate Fears Drive Home Builder Shares to Six-Month Lows

Fears of interest-rate hikes in June pushed the Standard & Poor's Supercomposite Homebuilding Index to a six-month low of 498.91 earlier last week. The stock prices of Centex Corp., D.R. Horton and Lennar Corp. plunged by 94 cents, 86 cents and 66 cents, respectively, during the afternoon of May 11. Many investors predict the improving job market will prompt Federal Reserve officials to boost the overnight interest rate in the coming weeks, driving up mortgage rates and putting a damper on housing demand. However, JMP Securities research director James Wilson notes that demand also depends on job growth and population expansion.
Broward Daily Business Review (FL) (05/11/04) P. 3: www.floridabiz.com

Living Large Outdoors Is Very Much In

Landscape designers have noticed an increase in demand for garden rooms among home owners who are seeking to create either a calm and serene area for relaxation or a more grandiose upgrade of their small outdoor spaces, according to Emily Nolting, a Kansas State University horticulturist. Garden rooms vary in size and shape, and some people may opt for multiple rooms connected by walking paths or bridges. Nolting notes that as the trend grows in popularity, garden room designs are becoming more complex to accommodate many different uses, from relaxation to entertainment. She says home owners should plan their garden rooms to match the existing interior and exterior designs of their residence and to reflect their own personalities and tastes.
Associated Press (05/10/04) Fosdick, Dean: www.ap.org

The Housing Boom Hits the High End

Home sales in the lower price segments outpaced those in the luxury market in recent years due to record low interest rates, but experts have seen more upper-end activity as both the national economy and the stock market rebound. For instance, sales surged 96% for $2 million-$5 million dwellings and 157% for homes with $5 million-plus price tags in Naples, FL, between January and April. The trend is not, however, limited to Florida — which has always enjoyed an edge with luxury buyers because of its homestead protection law and its absence of state income tax. Sales activity in the $1 million-plus segment is picking up in California, Rhode Island and other areas of the country as well. Price discounts are luring buyers in some locales, while limited inventory is fueling bidding wars in others. However, experts fear limited supply and concerns about inflation and the war in Iraq could soon stamp out the sector's budding recovery.

Wall Street Journal (05/12/04) P. D1; Simon, Ruth: www.wsj.com

Realtors Expect Minor Slowdown

The latest forecast from the National Association of Realtors® calls for sales of previously owned homes to slip 1.6% this year from a record 6 million units in 2003. Sales of new homes also are expected to fall back from last year's highs, dipping 1.2% to settle at 1.07 million units. The trade group's outlook additionally predicts higher property prices in both categories, with the existing-home price jumping 4.7% to a median of $178,100 and the new-home price bouncing up 5.1% to a median of $205,500. Finally, NAR projects that the long-term mortgage rate will float up to 6.6% by the end of the year.
Investor's Business Daily (05/11/04) P. A2: www.investors.com

Home Buyers Spend $3,100 Remodeling New Places

A study released at the 2004 National Hardware Show in Las Vegas last week reveals that home buyers spend an average of $3,100 to remodel or repair their property within the first year of moving in. The survey, conducted by the non-profit Home Improvement Research Institute, found that buyers of new dwellings sunk an average of $5,000 into their property; while those moving into an existing abode typically invest about $2,000. Rob Cappiello, industry vice president for the National Hardware Show, explains that while existing-home buyers tend to plan and complete more projects, new-home buyers, who generally have higher incomes, tend to spend more money because they are more likely to hire contractors and use high-end products. The most common projects planned by new-home buyers were decorating and landscaping for the purpose of beautification. Meanwhile, those working on existing residences were more likely to repair or replace older, worn-out structures and materials, such as flooring, electrical wiring and appliances. In both new and existing units, bathrooms, kitchens and living rooms were the most common targets for improvement projects. In addition to remodeling their new homes, recent home buyers also said they had spent an average of $3,000 making improvements to their previous homes in preparation for selling them. The most common jobs include painting, structural improvements, repairs and room conversions.
CBSMarketWatch.com (05/11/04) Kerch, Steve: cbs.marketwatch.com

Air Leaks Can Inflate a Home's Electric Bills

Home owners are shelling out hundreds of dollars more than necessary on their heating and cooling bills due to cracks in the walls; openings around doors and windows; and insufficient seals around ceiling lights and fans, water lines and attic doors, among other building imperfections. Besides wasting energy, these problems can create uneven heating and cooling throughout a residence. However, these air leaks can be easily fixed with caulk, foam sealant and fiberglass insulation. Home owners can check for disruptions in air flow by turning off the water heater and appliances, closing the fireplace flue, shutting all doors and windows, using an exhaust fan to depressurize the home and then watching the movement of smoke from a candle or incense stick. They can then repair any holes or cracks, restoring comfort and lowering utility bills.
Chicago Tribune (05/07/04) Sheinkopf, Ken: www.chicagotribune.com

Lofty New Look Making Old Mills a Hot Commodity

Lofts are popping up all over New England as developers seek to rejuvenate industrial cities, boost the housing stock and conserve open space by converting vacant mills and other throwbacks to the factory age. Such projects are popular in Lowell, Holyoke, Millbury, Williamstown, Fall River, Westford and Amesbury, MA; as well as in Hartford, Norwich and Bridgeport, CT; and the Rhode Island communities of Providence, Pawtucket, Cumberland, West Warwick and Bristol. The first mill conversions were completed during the 1970s; but low mortgage rates, state and federal tax incentives and the desire for a city lifestyle have renewed interest in these projects throughout the region and nationwide.
Boston Globe (05/10/04): www.boston.com/globe

Outdoor Home Spas Spark a Cascade of Luxury

Many home owners are shelling out anywhere from $8,000-$200,000 or more on outdoor spas, which can rival the designs of their indoor counterparts. The National Spa & Pool Institute's Suzanne Barrows attributes the trend to home owners choosing backyard escapes over travel plans. Today's spas often are equipped with DVD players, built-in card tables, a standing area for full-body massages and sophisticated pump and filtration systems. Some even employ sonar technology that alerts home owners when the water is disturbed, which is especially helpful in homes with small children.
USA Today (05/07/04) P. 8D; della Cava, Marco R.: www.usatoday.com

Builders and Remodelers Staying Abreast of 'Older' Trend

Seniors who prefer to remain in their long-time homes as they age are sometimes forced to make improvements that allow them to accomplish this goal without compromising safety, independence and comfort. According to NAHB Remodelors™ Council Chairman Doug Sutton, "Remodeling for aging in place demands sensitive integration of myriad functional and design considerations into a unified, aesthetically pleasing whole." Builders who have earned NAHB's Certified Aging-in-Place Specialist (CAPS) designation can handle such improvements, which range from first-floor bedrooms and entrance ramps to lower counters and shower grab bars.
Copley News Service (05/10/04) Woodard, James M.: www.copleynews.com

ProSystem fx Practice 6.0

ProSystem fx Practice 6.0 updates its Client Management and Project Tracking modules, the latter of which is now called Project Management. The Project Management module gives users access to tax forms for various projects and automatically calculates filing deadlines. The Client Management module, meanwhile, boasts better data organization and can be set up to permit only certain users to view sensitive information on the Administrative and Billing tabs. By integrating with ProSystem fx Tax, users can easily exchange data and access productivity, tax planning, trial balance and other integrated products.
CPA Wealth Provider (04/04) P. 6: www.electronicaccountant.com/html/cpawealth

Countrywide Awards Million-Dollar Grant to National Housing Endowment

The National Housing Endowment, the philanthropic arm of NAHB, announced that it has received a gift of $1 million from Countrywide Financial Corporation to support its ongoing efforts to address the critical needs and priorities of the housing industry.

“The National Housing Endowment is indebted to the generosity of supporters like Countrywide Financial Corporation,” said Dale Stuard, chairman of the endowment and 1988 NAHB president. “Countrywide is known for its unwavering commitment to making the dream of homeownership a reality for American families. Through this exceptional gift we look forward to supporting worthy causes that advance housing efforts across the United States.”

Working in partnership with state and local home builders associations, the NAHB Research Center and the Home Builders Institute, the National Housing Endowment promotes building industry education and training, supports research and recognizes achievements in housing.

The endowment also provides a permanent source of funds for addressing long-term industry concerns. Since its inception, it has awarded almost $5 million in grants for housing-related initiatives nationwide. With Countrywide’s gift, the endowment is fast approaching its current goal of raising $25 million.

“Countrywide has a long track record of championing the availability of affordable housing, an issue we consider to be one of the largest factors in the homeownership gap that exists for minorities and lower-income individuals and families,” said Angelo Mozilo, the company’s chairman and a trustee of the endowment. “Supporting the National Housing Endowment is an ideal way for Countrywide to participate in the national dialogue on this important issue, give back to communities in need and ultimately provide better housing opportunities for all Americans.”

The gift was announced during NAHB’s recent spring board meeting in Washington, D.C. and was commemorated with a ceremony to unveil the Countrywide Conference Room on the ninth floor of the National Housing Center. The formal dedication was led by Stuard and NAHB President Bobby Rayburn and attended by friends of the endowment and representatives from NAHB and Countrywide.

At the NAHB board meeting, after conveying the endowment’s thanks to Countrywide for sharing the commitment of the nation’s home builders to expanding homeownership opportunities, Stuard presented Jack L. Haynes, executive vice president of Countrywide’s National Builder Division, with a key to the National Housing Center and a crystal eagle representing NAHB.

For further information on the National Housing Endowment, e-mail Julie Wheeler or call her at 800-368-5242 x8483.

Photo by David Scavone

Housing Snapshot

Amidst rising expectations for the Federal Reserve to start gradually moving up interest rates, mortgage rates continued their slow upward climb last week. Thirty-year, fixed-rate mortgages rose to 6.34% on Freddie Mac's weekly index, up from 5.45% a year earlier. General economic news suggested that the economy is perking up: Commerce Department statistics showed that exports in March increased 14.6% from a year earlier; and the Labor Department showed that the manufacturing sector added 21,000 jobs in April, the first increase in almost four years. There were also more signs of inflation last week: a 0.2% increase in the Consumer Price Index and a 0.8% rise in the producer price index in April, suggesting that the Fed may decide on its first rate hike next month. On the lumber front, framing lumber rose slightly to $463 per 1,000 board feet last week, according to Random Lengths, but panel prices tumbled to $485 per 1,000 square feet for 15/32-inch 3-ply CDX southern westeast plywood and to $450 for oriented strand board. They still have a lot more tumbling to do, however, before they return to normal levels.

Mortgage Interest Rates

30 Year Fixed Rate: 6.34\%
15 Year Fixed Rate: 5.72\%
1 Year ARM: 3.90\%

Housing Starts: Mar. 2004

Total: 2.007 million\%
Single Family: 1.599 million\%
Multi Family: 408,000\%

New Home Sales: Mar. 2004 *

1.228 million

Existing Home Sales: Mar. 2004 *

6.48 million

* Seasonally Adjusted Annual Rate

You Can Help Solve the General Liability Insurance Problem

Costs for insurance are skyrocketing, and in some markets, builders can’t get coverage at any cost.

This is one of the biggest challenges facing home builders and contractors today, and it is a top issue for our federation.

In response, NAHB has formed a partnership with Marsh, the global risk management consulting firm. In a plan endorsed by the NAHB Board of Directors, our association and Marsh are gathering data from builder, remodeler and trade contractor members to create a comprehensive profile of the home building industry’s risk management needs. Marsh will then use that profile to develop effective new general liability insurance (GLI) products for NAHB members.

The first and most important step is to understand the actual loss experiences of the residential construction industry. Marsh is surveying thousands of NAHB members to learn more about their businesses and their insurance needs. Members will also need to provide Marsh with a letter addressed to their insurance carrier giving the carrier consent to share loss information with Marsh.

Over the next 60 days, NAHB and Marsh will be contacting builder, remodeler and trade contractor members and asking them to complete the survey, put the consent letter on their letterhead and send those materials to: Marsh, c/o Jessica Hatch, 1166 Avenue of the Americas, New York, NY 10036.

Marsh will use the information gathered from builders, remodelers and trade contractors to develop a sophisticated profile of the residential construction GLI market. This broad understanding of the market will enable Marsh to develop risk-management strategies that improve the coverage, cost and availability of GLI for the home building industry.

We need your help.

If you are a builder, remodeler or trade contractor, then we need you to fill out the survey, put the consent letter on your letterhead and send these materials to Marsh. If you are one of the 44,000 members who receives the GLI mailing, then please complete the survey and consent letter and send these materials to Marsh as soon as possible. If you do not receive these materials in the mail, then I strongly encourage you to go to www.nahb.org/gli. There you will find all the materials from the mail piece.

We need as many builders, remodelers and trade contractors as possible to participate in this effort. Please note that your insurance agent can be an important resource in finding this insurance information.

I want to stress two points: 1) All information in the database will be kept in strict confidence; and 2) Your current insurance agent will have the opportunity to sell new products developed through this initiative.

This is about your business profits. This is about the long-term health of our industry. Taking a few minutes to gather your insurance information and send it to Marsh could be the first step in solving one of our industry’s toughest challenges — and in saving you thousands of dollars in insurance premiums.

Please do your part.

Association Health Plans Endorsed by Senate Task Force

A Senate task force report on health care accessibility and affordability identifies association health plans as a potential strategy to help alleviate the rising number of uninsured and the high cost of health care.

NAHB has been a strong advocate of the plans as a solution for the skyrocketing health care costs over the past decade that have driven many small businesses out of the health insurance market entirely, forcing them to abandon coverage for their employees.

NAHB President Bobby Rayburn said that the association health plan legislation endorsed by the Senate task force would “decrease administrative costs and allow small business owners to negotiate better rates with insurers, enabling them to purchase quality health care at a lower cost for their families and employees.”

According to the U.S. Census Bureau, more than 43 million Americans currently have no health insurance, and approximately 60% of them are in families headed by an employee of a small business.

To correct this situation, Senate bill S. 545 — sponsored by Senators Olympia Snowe (R-ME), Christopher Bond (R-MO), Robert Byrd (D-WV), Norm Coleman (R-MN), Elizabeth Dole (R-NC), Kay Bailey Hutchison (R-TX), John McCain (R-AZ), Arlen Specter (R-PA) and Jim Talent (R-MO) — would allow small business owners to band together across state lines through membership in a bona fide local, state or national trade association to leverage their size, just as large businesses and unions do, to negotiate lower insurance costs and more options.

The measure has the strong backing of the Bush Administration and more than 160 trade associations.

In a related development, the House last week voted once again to approve association health plan legislation, which previously passed the chamber on June 19, 2003. The unusual decision to consider the issue for a second time is part of a larger effort by House Republicans to highlight the legislative strategies Congress should undertake to ensure that America remains competitive in creating new jobs.

“The Small Business Health Fairness Act” was originally introduced as H.R. 660, but during last week’s special vote it received a new bill number, H.R. 4281. The legislation, which was approved by a 252 to 162 margin, is identical to H.R. 660, and was introduced by Reps. John Boehner (R-OH), Sam Johnson (R-TX), Max Burns (R-GA), Nydia Velazquez (D-NY) and Cal Dooley (D-CA).

Before the House vote, NAHB sent a letter to the full chamber urging lawmakers to support the bill, and, to emphasize the importance of this issue to home builders and America's small businesses, designated consideration of the measure as a key vote.

“The Senate task force report and House passage of this measure for a second time shows how sound health care policy can help America’s workers," said Rayburn. "Hopefully, these developments will provide impetus for the Senate to act on companion legislation S. 545 in order to strengthen America’s health care system and ensure that American workers receive the cost-effective, high-quality health care coverage they deserve."

To read the House and Senate legislation, click here and enter the bill number in the box at the upper left.

For further information, e-mail Michael Strauss or call him at 800-368-5242 x8252.

Senate Tax Bill Revives Energy Efficiency Incentives

In a victory for NAHB, the international tax bill approved by the Senate last week includes home energy efficiency tax credits that have long been sought by the nation’s home builders.

With the energy bill languishing in the Senate, Sen. Pete Domenici (R-NM), chairman of the Energy and Natural Resources Committee, led the effort to incorporate tax incentives from that package — including the home energy effiency tax credits — into S. 1637, the “Jumpstart Our Business Strength (JOBS)” bill.

During Senate consideration of S. 1637 on May 11, Sen. John McCain (R-AZ) offered an amendment to strike the energy tax provisions from the bill. Opposing his amendment, NAHB sent a letter to all 100 senators reiterating its support for the home energy efficiency tax credits and urging opposition to any effort to remove them from the JOBS legislation.

The McCain amendment failed on a vote of 85 to 13, and the Senate then went on to vote 92-to-5 in favor of final passage of the JOBS bill.

The energy credits would provide powerful incentives for millions of home owners, renters and buyers to conserve energy and save hundreds of dollars annually in utility costs.

Specifically, the legislation would provide:

• A $1,000 tax credit to builders for the construction of a new home that is at least 30% more energy-efficient than a home built under the latest standards of Chapter 4 of the International Energy Conservation Code approved by the Department of Energy. The tax credit jumps to $2,000 for homes that are at least 50% above the code.
• A 10% tax credit up to $300 on projects that reduce energy consumption in existing homes. Eligible improvements must be certified to meet or exceed the latest prescriptive criteria for such components in the International Conservatioin Code approved by the Department of Energy. The credit would go to the home owner.
• A $2.25 per square foot commercial property deduction for rental housing four stories and higher that is at least 50% more efficient than buildings constructed to the American Society of Heating, Refrigerating and Air-Conditioning Engineers 90.1-2001 standard.

The House will be considering similar legislation this summer and NAHB will continue to lobby for the enactment of home energy efficiency tax credits this year.

To read the legislation, click here and enter S. 1637 in the box at the upper left.

For further information, e-mail Michael Strauss or call him at 800-368-5242 x8252.

Builder Confidence Strong and Steady in May

Builder confidence in the new-homes marketplace held firm at a healthy level in May, according to NAHB’s Housing Market Index (HMI). The monthly gauge of builder sentiment remained unchanged from an April reading of 69.

“Demand remains strong and as mortgage interest rates begin to edge up, buyers continue to move into the marketplace at a healthy clip,” said NAHB President Bobby Rayburn. “Robust job growth, solid home-price appreciation and favorable interest rates that remain low and attractive by historical standards point to an upbeat outlook for housing.”

The HMI is derived from a monthly survey of builders that NAHB has been conducting for the last 19 years. Home builders are asked to rate current and expected sales of single-family homes and traffic of prospective buyers. Any number over 50 indicates that more builders view sales conditions as good than poor.

The indicator measuring buyer traffic jumped seven points to a 13-month high of 55 in May, offsetting slight declines in the two other components of the HMI index. Current sales of new single-family homes fell three points to 74 and sales expectations for the next six months declined one point to 75.

“When the index of prospective buyers jumps above 50, it usually indicates a solid housing market and shows that more families are looking for new homes,” said NAHB Chief Economist David Seiders. “With job growth and household income accelerating, this will provide a stronger foundation for economic activity during the second half of this year and in 2005. And that’s good news for housing, despite moderate increases in mortgage rates from recent lows.”

Noise Exposure Regulation Discussed With OSHA Administrator

Possible revision of a standard for the regulation of the exposure of residential construction workers to excessive noise was among the concerns discussed by NAHB representatives during an April 30 meeting with John Henshaw, assistant secretary of Labor for the Occupational Safety and Health Administration.

Revisions that are being considered by OSHA to its hearing conservation standard for construction include components of its standard for factories, which requires a written program, annual hearing tests for workers, monitoring job sites for excessive noise and maintaining medical records for more than 20 years.

Anthony Clatterbuck, a member of the NAHB Construction Safety and Health Committee, told Henshaw that any changes to the current regulation should be flexible for small business owners and should be affordable and cost-effective.

Current noise standards in construction require hearing protection for workers if sound exceeds 90 decibels over an eight hour day, the equivalent of a running lawnmower.

Clatterbuck brought several points to the attention of the OSHA administrator:

• High noise generating activities — such as jack hammering, abrasive blasting, erecting steel and tunnel drilling — are not typically performed during new home construction.
• Saws, generators and other noisy equipment are being designed to produce less noise.
• Noise on construction sites is intermittent and short in duration, compared to factories and assembly lines, where it is generally constant.
• Monitoring exposure would not be cost-effective because of constantly changing noise exposures in the work environment.
• Hearing tests would not be feasible because the workforce of small builders is made up of employees who move frequently from one company to another.

At its May 2 spring meeting in Washington, D.C., the NAHB Board of Directors adopted policy urging OSHA to rely on the existing standard for preventing hearing loss instead of creating new requirements. (For the full text of this resolution, NAHB members can click here.)

Hexavalent chromium compounds found in trace amounts in several building materials, hazards associated with working in confined spaces, exposure to silica and OSHA’s construction safety standard for cranes and derricks were also discussed during the meeting.

NAHB also highlighted the positive work that has been accomplished during the first year of an alliance between NAHB and OSHA to develop training and education materials for the industry’s workforce.

Dave Knipe, chairman of the NAHB Construction Safety and Health Committee, reported that the two organizations had worked together to publish the “Scaffold Safety Handbook,” which is available in both English and Spanish.

The two are in the process of developing a job site safety orientation video for home builders, which will also be available in bilingual versions.

For more information, e-mail Rob Matuga or call him at 800-368-5242 x8507.

Virtual Reality Tours Can Translate Into Real Sales

One of the most daunting challenges of building an active adult community (or almost any community, for that matter) is marketing before the models or amenities have been built. In exploring ways to pre-sell or at least pre-reserve your home sites, consider using Virtual Model Simulations (VMS) or virtual reality programs. Animators can work with the builder/developer, civil engineer, architect and landscape architect to create a virtual tour of every aspect of your community.

Our company used virtual reality to market River Oaks, a master-planned, mixed-use, multigenerational community in San Luis Obispo County, CA, during its early stages of development. The models and community center are now up and running, and its clubhouse and six-hole golf course will open in mid-June. But, through virtual reality tours, we were able to generate a lot of sales activity before any of these amenites were in place. 

At that time, prospects were able to tour the entire community by logging on and viewing the community and its features on a digital plasma screen. Prospects first “entered” RiverOaks through the swinging wrought-iron gates at the entrance to the actual community. They were then able to see the golf course, clubhouse, exteriors of many of the homes, the 5,000-square-foot community center, swimming pool and lush landscaping — before many of the amenities were actually completed.

The virtual tour also included an animated “room by room” walk-through of each home, including options, and a “fly-through” VMS of the community center’s interior.

A Valuable Tool for Public Presentations

The virtual tour also allowed us to share our community vision with all the parties involved with the project — not only prospects, but public officials and subcontractors, too. VMS showed everyone involved exactly what we were envisioning and left little room for misunderstanding or misinterpretation.

While I have spent two or three hours at zoning board podiums during many a meeting explaining projects, the virtual model simulation cut my River Oaks presentation time down to 15 minutes and gave the board a clear picture of the scope of the project. Similarly, subcontractors were able to "see” the whole community and how their specific trade fit into the bigger picture. It also helped me more clearly point out what I needed them to do to help realize the finished product. If a picture is worth a thousand words, computer animation is worth a million words.

Tying It All Together

While in the process of producing the virtual reality program, we contracted a company that specializes in marketing seniors housing to develop a comprehensive marketing and media plan. They developed a plan, budget and timelines; helped us recruit a community lifestyle coordinator, our first point of contact for prospective buyers; and established our on-site information center.

It didn’t take long before the information center and our virtual tour became a tourist destination. In fact, the virtual tour became so popular that we set viewing limits to guarantee that everyone had a chance to participate. With or without sales staff, visitors could view the presentation and then print out selected floor plans, elevations and other collateral information to create their own personalized brochure. We soon installed additional VMS kiosks in the builder’s sales office.

Virtual Popularity Brings Success

Armed with our virtual reality tour, a creative community outreach program and strong marketing collateral, we quickly generated interest in the project and offered preferred reservation agreements in mid-2002. By August 2003, we had approximately 290 people in the queue for selection of our 210 home sites.

Because virtual reality tours are such a new concept in the seniors housing market, we didn’t know exactly what to expect. But we have been pleasantly surprised with the results and with our overall costs.

Admittedly, VMS technology requires a substantial financial investment. Ultimately, it will save us money in other areas and we are already finding ways to cut costs without reducing our sales potential. For instance, where we had originally planned to create six models to showcase all our floor plans, because of the success of the virtual tour and the reservations it dictated, we were able to save by actually building only four.

Before planning your marketing, consider using virtual reality to engage your prospects and educate others about your community. It’s a wise investment in your future success.

This article appeared in the Fall 2003 issue of Seniors’ Housing News, a publication of the NAHB Seniors Housing Council. Dick Willhoit is the owner of Estrella Associates, Inc., a privately held California-based corporation specializing in land development, private account construction and construction management. His current project, River Oaks, is a 200-acre community with 481 residential units, an elementary school, RV/self-storage, neighborhood commercial center and a golf course. River Oaks won two Legacy 2000 Best in Planning “On the Boards” by the Home Builders Association of the Central Coast, which named Willhoit its Builder of the Year in 1996. For more information, e-mail Willhoit or call him at 805-238-1031.

New NAHB Publication Details Positive Effects of Seniors Housing

Active adult communities produce positive revenue, taxes and jobs for local municipalities while putting less strain on local infrastructure, according to a newly-published resource produced by NAHB’s Seniors Housing Council to help educate planning boards, city or county councils, civic and home owner associations and the public about the positive impacts of active adult projects.

"Approving Seniors Housing — Facts That Matter," an online publication available through BuilderBooks.com, was compiled to help builders and developers of seniors housing demonstrate that their projects will not adversely affect the surrounding community.

“For developers, the burden of proof can be great,” said Paul Emrath, a vice president in NAHB’s Housing Policy Department. “Many zoning ordinances still do not explicitly recognize seniors housing as an allowable land use, so a special exemption or use permit is required. Developers also must contend with infrastructure requirements and impact fees that are unrealistically high.”

Key findings in "Approving Seniors Housing" include:

• Building an active adult community of 100 single-family homes can produce $3 million in local income, $504,000 in taxes and other local revenue for local governments and 67 new jobs.
• Seniors generate fewer trips in their cars than the average household — especially at rush hour.
• Local governments spend less on water and sewer services for residential developments that are age-qualified or age-targeted to seniors than they do on average households.
• Seniors households do not necessarily oppose school bond issues even though they have relatively few children.

Ed Hord, a Baltimore, MD-based architect, used the information about seniors housing to win approval of a 100-unit assisted living facility.

“Sharing these statistics with communities and land-use authorities can shave months off the approval process and reduce expenses,” Hord said. “A developer we're working with used the water consumption figures to negotiate lower impact fees.”

“Many well-meaning public officials and conscientious citizens are misinformed about seniors housing,” Emrath said. “Approving Seniors Housing provides them with the statistical information they need to make the right decision.”

Issues addressed in "Approving Seniors Housing — Facts That Matter" include:

• The economic impact of an active adult community, including jobs, incomes and taxes
• Education
• Planning for road improvements
• Public safety services
• Parking standards
• Water and sewer services
• Public parks and libraries

For more information, go to "Approving Seniors Housing — Facts That Matter" online at BuilderBooks.com. The publication is available through BuilderBooks.com’s Digital Delivery.

Learn More About Seniors Housing Through the Seniors Housing Council

To learn more about seniors housing, join the NAHB Seniors Housing Council. The council provides information, education, networking and recognition opportunities for its members and represents NAHB on seniors housing issues. For more details, e-mail Jeff Jenkins or call him at 800-368-5242 x8292.

Four Easy Steps to Turn Your Newsletter into a Powerful Marketing Tool

We’ve all received newsletters in the mail that we’ve instantly relegated to the trash can. But there are some that captivate us, ones we find inexplicably interesting and that draw us in.

What makes the difference? Why do some newsletters take us to a place of caring and involvement while others don’t make the cut past the “junk” pile?

The answer can transform your newsletter from a narrowly focused community circular into a valuable, far-reaching lead production tool.

Here are four easy steps to help transform your newsletter:

1. Define Your Purpose, Hook Your Reader
   
   Are you trying to reinforce your identity, overcome ill perceptions, encourage purchases? Tailor your articles to each specific purpose.
   
   Remember that no matter the subject, an article should offer a lead-in or headline that serves to hook the reader early on. Make headlines sound new and exciting so that readers will feel they are receiving exclusive information that others haven’t yet been allowed to receive. This will encourage them to continue to check your newsletter for proprietary or exclusive information that may benefit them and that they think they may not otherwise hear about.
   
   
2. Know Your Audience
   
   Before including an article, ask yourself what reader need it satisfies or what reader problem it solves. It could be direct — announcing a new fitness facility that will improve residents’ well being — or indirect — like an editorial tour of cultural events in your area that positions your community as a place where life is better than anywhere else.
   
   Remember to tailor your ideas to your readers’ lives.
   
   
3. Call Readers to Action: Tell Them How to Respond
   
   Ask readers to pass your newsletter along to an interested friend. Or include an attached business reply card in your newsletter to encourage reader response.
   
   If you are announcing a new neighborhood, specifically urge interested readers to call immediately for the best selection. If you are showcasing upcoming community or city events, ask out-of-town readers to call to schedule a coinciding visit. If you have the resources, offer mini-concierge services that will position your community as a high-service, personally involved host.
   
   You can even ask for reader feedback. Knowing what readers would like to read about in future editions is useful, and it’s an easy way to track what type of articles are garnering interest.
   
   
4. Make It Beautiful, Visually and Mentally
   
   The best way to get your newsletter opened is through an eye-catching design. Full color images and an unusual format or size will help it stand out from other mail.
   
   Focus on ease of navigation, legibility and professional design. But do more than make it visually beautiful. Take advantage of your community’s best features to evoke a pleasant feeling in the minds of your readers.
   
   For instance, if you are in a subtropical location, include the weather forecasts for the upcoming months. Readers in cold climates will look forward to their monthly “escape” via your newsletter as they dream about a warm, lush locale. Design and write your newsletter to convey the feeling of your community and to transport readers to a special, inviting environment of your making.

Creative Solutions Needed for Historic Renovations

By Stephen L. Robinson, CGB, CGR, GMB
Remodeling creates a number of interesting details and challenges not always encountered in typical residential construction. And when it comes to historic renovations and restorations, these challenges can be even more acute.

Recently, we had the opportunity to work on a house built originally as a duplex around the turn of the century in Indianapolis. The customer wanted to maintain the historical integrity of the home while also creating more interior open areas and incorporating energy efficient products and techniques.

One of the challenges was to maintain the wood exterior on the house. Because of its condition, we had to replace 60% of the existing poplar siding, so we brought in cabinet manufacturer Spiceland Wood Products to cut molding heads to specially run the poplar siding.

We used a variety of products to increase energy efficiency, per the owner’s request. We installed tilt sash, double hung windows with muttons by Pozzi Windows because they duplicated the look in the house. We used Nu-Wool Wallseal insulation, a spray-in-placeinsulation, to stop air infiltration and provide maximum thermal efficiency. We also installed a tankless water heater to save energy and water, a condensing combination washer and dryer, energy-efficient lights wherever possible and a 90-plus efficient furnace with a 12 SEER air conditioner to cut the fuel bills.

We also salvaged some existing doors and had them remade as pre-hungs so we could replicate the home’s texture and feel.

To open the downstairs area, we engineered a way to remove interior walls and create the open effect the home owner desired. We eliminated a flat ceiling in the kitchen and installed an LVL (laminated veneer lumber) across the top, framing it with dimensional lumber to create an R-30 vaulted ceiling that really set off the back of the house.

The owner wanted to add a little creative touch and found a piece of stained glass for us to install in an opening in the rear of the home that was originally an attic access. We took the glass, created a window for it and made a wonderful accent.

We created the interior staircase in a layover with hand-made poplar. In fact, all the trim in the house was poplar. To be environmentally friendly, the home owner chose bamboo flooring throughout the home, with the exception of tiled areas for the kitchen and baths.

These were just some of the techniques and products we were able to use to create an extraordinary home with modern conveniences and innovative technologies on the inside while maintaining its historical representation on the outside. The project enabled us to be creative while fulfilling the customer’s needs.

Stephen L. Robinson, CGB, CGR, GMB, CAPS, is the owner of R.E. Construction and Maintenance Services, Inc., a residential and commercial remodeling firm based in central Indiana. For more information, contact Robinson through his Web site at www.reconst.com.

Index Finds Confidence of Home Remodelers at Record Level

Residential remodelers are bullish on the outlook for their industry this year, according to NAHB’s Remodeling Market Index (RMI), which rose to a record level during the first quarter. The index measures current market conditions and future expectations for the nation’s $176-billion-a-year remodeling industry.

Current conditions in the first quarter rose to 59.0 on the index, which was 12.6 points higher than the same quarter of 2003. Future expectations were pegged at 62.8, a 12-point gain over the same period a year earlier.

“When the RMI moves above 50, it tells you that the industry is very healthy," said NAHB Remodelors™ Council Chairman Douglas Sutton, Sr., CGR, CAPS, of Sutton Siding and Remodeling in Springfield, IL. “And right now across the country we are also seeing record numbers of calls for bids and reports of backlogs that will keep us busy throughout the year.”

The RMI is based on a quarterly survey of some 600 professional remodelers. It is comprised of an index that gauges current market conditions based on reports of major and minor additions and alterations, and maintenance work and repairs, on both owner- and renter-occupied dwellings, and a second index on expectations for the near future based on calls for bids, the amount of work committed for the next three months, job backlogs and appointments for proposals.

A variety of “special questions” are also asked at the end of the survey to help pinpoint market trends.

The index showed that remodeling in every region of the country was stronger in this year’s first quarter than a year earlier. The biggest gain occurred in the Midwest, where the index jumped by 17.6 points to a healthy 62.1.

“The year-over-year gains in both indexes for every region are remarkable, and point to another banner year for the remodeling industry in 2004,” said NAHB Chief Economist David Seiders. “What’s more, substantial year-over-year gains are apparent for every single component of the future expectations index.”

An RMI question on communications technology found that 96% of survey respondents own a personal computer and 36% of them use their computers for sales presentations. Half of the respondents said they had created a Web site for their business that includes contact information, pictures of finished jobs, the types of jobs the company undertakes and a history of the company.

“Contractors today realize they have to keep up with technology and use it to promote their companies,” said Sutton. “More and more customers are looking for contractors on the Internet, and they want to see what each company has to offer before they even call. A Web site is an indispensable tool for remodeling companies today.”

Don’t Let Your Comfort Level Dictate Future Tech Changes

The next in a series of tech talks for builders.

A builder I worked with last year wanted to reduce his cycle time, improve his production schedule’s accuracy and enhance his customers’ experience. However, he rejected what was probably the best fit for his stated objectives because the integrated software he’d been considering couldn’t replicate the sales backlog and project management reports his company had been using for some time.

Sure, the reports satisfied a certain comfort level of control that management required, but what did they really accomplish? Not much.

The sales backlog report was a periodic spreadsheet of “deals in the pipeline” and included a monthly update of the time remaining to close each deal. The report sounds worthwhile, but theupdates were totally subjective and based on each project manager’s assessment of the contracts’ current status. In addition, the spreadsheet was updated manually, which made it prone to error. To make matters worse, the report did not link to the company’s construction schedule.

The project management report wasn’t much more effective. Granted, it was an impressive looking set of schedules alongside the other financials. It contained an expense breakdown that included a time sheet indicating how each project manager divided his time among several projects. It also tracked several expense items that were charged to the project level. The problem was that the project managers didn’t fill in their reports accurately; they estimated their time and project expenses well after the fact. The end result was a batch of minutiae on which no one took action.

The builder decided not to integrate or update his stand-alone, manual procedures. He based his decision on a defensive and “safe” set of constructs that would enable him to maintain the status quo — not move forward. You can imagine what that did for the systems he was trying to improve. How can you avoid making the same mistake in your organization?

How to Become More Comfortable With Change

Use the following tips to become more comfortable with change and to make decisions based on what “should be” rather than on what has been done in the past:

• Top management must embrace change and compel staff to drive a value-based decision-making process. For example, if your customer service manager is dead-set on not updating or improving the company’s warranty claims process, he or she had better be able to provide good reasons why the process should remain as it is. Chances are those reasons won’t outweigh the benefits of an improved system.
  
  
• An integrated, automated system is ultimately the only way to eliminate redundant data entry and information retrieval. If you maintain separate databases, they should at least be electronically synchronized and perpetual.
  
  
• Every “feature” of a new or updated system must yield measurable, demonstrable results that make a personal difference in your company. Just because one builder accomplishes something with a given system or software program does not mean another builder can attain the same results.
  
  
• A demonstrable result is the result of written procedures that employees follow all the time.
  
  
• Measurable results translate into quantitative and qualitative differences that can be implemented and documented.
  
  
• Budget for sufficient resources (staff time to review different systems, software training, working with a consultant or vendor, etc.) to evaluate and implement the new system or upgrade. This does not simply mean an automatic conversion from one system to another and getting through it as quickly as you can. It involves assessing every aspect of your company to see where change will make a difference, and then taking the time to allow that change to improve the operation.

A system decision is a real opportunity to take stock of your company’s character and culture. This makes true change more attainable and prevents the past from controlling the future.

Earlier Articles in This Series

• To read, “Know Your Technology Needs Before You Invest,” Part 1 of this series, published April 14, click here.
• To read, “Strategic Planning Software Can Help Focus Your Business Model,” Part 2 of this series, published April 21, click here. 
• To read, “Does Your Planning Software Match Your Project's Sophistication?” Part 3 of this series, published May 5, click here.
• To read, “Don't Put the CAD Before Your Product,” Part 4 of this series, published May 26, click here.
• To read, “Manage Prospects and Buyers More Efficiently With Technology,” Part 5 of this series, published June 9, click here.
• To read, "Automate Your Selection and Change Order Processes,” Part 6 of this series, published on June 23, click here.
• To read, “Scheduling Software Can Improve Your Cycle Time,” Part 7 of this series, published on July 7, click here.
• To read, "An Effective Purchase Order System Enhances Efficiency," Part 8 of this series, published on July 21, click here.
• To read, "Don’t Fix New Software If It Isn’t Broken," Part 9 of this series, published on November 24, click here.
• To read, "Beware Software Consultants Who Are Salespeople in Disguise," Part 10 of this series, published on December 8, click here.
• To read, "Eight Ways to Drive Internet Leads and Sales," Part 11 of this series, published on January 12, click here.
• To read, "Excessive Web Site Graphics Can Stunt Sales," Part 12 of this series, published on February 2, click here.

Want More Information About Using Technology in Your Business?

NAHB’s Business Management Department offers a variety of online resources to help you run your business better and more profitably. Click Business Management Tools for articles about human resources, financial management, sales, production, technology, customer service and other business-related topics. In addition, visit the NAHB Software Users Network Discussion Forum (SUN) to ask technology consultants and other builders what they think of various software packages and applications.

BuilderBooks.com also offers a variety of publications about computer technology. To view or purchase these publications online, click here.

Subscribe to NAHB’s Business of Building e/Source

NAHB’s Business of Building e/Source is your monthly electronic guide to the hot issues and emerging trends in home building business management. You’ll find practical advice, tricks of the trade and sound business guidance — all delivered monthly, straight to your desktop, in a quick and easy-to-read format. Business of Building e/Source is available free to NAHB members and their employees. To subscribe, click here on the members only side of www.nahb.org.

New HUD Policy on Section 8 Voucher Renewals Raises Grave Concerns

Drawing sharp criticism from NAHB and other housing organizations, a recent change in how the Department of Housing and Urban Development calculates funding for Section 8 voucher renewals could plunge many public housing authorities (PHAs) into a crisis.

Based on a narrow interpretation of language in the FY 2004 omnibus appropriations bill, HUD on April 22 gave notice that it would no longer base funding on actual voucher costs. Instead, it will only pay for the number of vouchers under lease as of Aug. 1, 2003, adjusted for inflation.

Under this new policy, PHAs in areas where housing costs have risen faster than HUD’s inflation adjustment or that have issued vouchers after Aug. 1 will be unable to cover their obligations for this year. As a result, they may be forced to stop issuing vouchers, to raise rents for residents or to reduce rental payments for property owners.

Residents who can’t afford to pay higher rents may have to move and property owners whose rents are significantly reduced could see the financial health of their properties undermined.

Massachusetts estimates that it will lose 2,700 vouchers in FY 2004 if HUD proceeds as planned, and the Sacramento Housing and Redevelopment Authority says it will see a shortfall of $1.6 million-$2.6 million, forcing it to terminate 500 vouchers.

NAHB is also concerned that the new policy over the long term will discourage apartment owners and lenders from participating in the Section 8 voucher program because they can no longer be assured that funding for the program is stable and reliable.

Since the program’s inception, Congress has never reduced funding for Section 8 renewals, and it appropriated enough money to fully fund all authorized vouchers in 2004. HUD, nevertheless, has not backed down from its position, spurring complaints from many members of Congress, who have reiterated that their intent has been to fully fund all authorized vouchers.

NAHB has expressed grave concern about this issue to HUD Secretary Alphonso Jackson and to Deputy Assistant Secretary of Public Housing William Russell. The association is also working closely with Congress to ensure that HUD spends the funds that have been appropriated so that families are not displaced and housing providers and investors continue to participate in what to date has been a highly successful program. 

Home Buyers Seeking More Privacy, Harmony

In a world filled with anxiety and uncertainty, home buyers are tailoring their homes to better suit the way they live, said Gayle Butler, the editorial director of special publications at Better Homes & Gardens.

Speaking during NAHB's construction forecast conference last month, Butler explained that the trend among home buyers was to enhance privacy, style and functionality in their homes. To do this, home buyers are right-sizing their homes, reshaping rooms, creating harmony between indoor and outdoor space and paying close attention to the details both inside and out.

Exteriors — Traditional Is Popular, Authenticity Desired

The new American style of home is traditional, according to Butler. A key exterior feature that buyers find attractive is stonework. But no matter what types of exterior materials are used — wood siding, stone, stucco, etc. — she said buyers today expect a “quality look” that translates into a “four-sided design where the same materials wrap all around the house.”

While traditional home designs are popular, Butler also indicated that buyers wanting other home styles expect authenticity. If there is any variation in this trend toward established designs, it can be found primarily in the second home market. “Home owners are putting playfulness in their vacation homes,” she said.

In addition to the style of the home, home owners are reemphasizing their streetscape, she said. The emphasis is on the home and the garage is “receding,” either being tucked under the home of finding a location behind it.

Right-Sizing — Putting Quality Before Quantity

“The quality of the space is as, or more, important than size,” said Butler. As children move out of the home, home buyers are scaling back on the size but maintaining or changing the functionality of the rooms so the rooms better reflect how they live. Buyers, she said, are decorating or appointing their homes so they can get more out of each room.

For instance, living rooms are becoming less formal, and in some cases being used for completely different functions, such as getaways or studies. “The living room isn’t endangered yet, but it is on the watch list,” Butler said. The dining room, she added, is now being treated as a special gathering space for holidays and special occasions.

Re-Shaping Rooms — Balancing Spaciousness with Intimacy

Windows, columns, volume, texture and openness are all part of the trend in balancing spaciousness with intimacy. Buyers are seeking room heights of nine, 10 and 12 feet. They are using more natural materials, including hardwood flooring. And they are adding handcrafted artisan touches to their homes in an effort to create intimacy.

Buyers want openness and flow through their homes, Butler said, but even in this environment, they are creating small, intimate gathering or seating areas through the use of half walls, built-ins, columns, mini work stations and other details.

Indoor/Outdoor Harmony

Butler said the next big thing in homes is opening homes to the outdoors much more substantially. This translates, essentially, into creating full-scale rooms like living rooms, dining rooms, etc, outdoors. This not only applies to decks and backyard space, she said, but also to transitional spaces like porches and sunrooms.

Beautiful Moments — Building Emotional Richness

Nooks, alcoves, windows and other details are being used to accent and create beautiful moments as well as highlight functionality in the home, according to Butler. Within bathrooms, home owners are trending toward more privacy and elegance.

Home owners are also seeking style and function throughout the home. Home offices, she said, are being located off a foyer near the owner’s suite for convenience. Like other rooms and areas throughout the home, they are being designed using materials, textures and accents to satisfy the functionality and style of the home owners.

Laundry rooms are achieveing a measure of style, as well, said Butler. More functions are being incorporated in the space, which is being moved up and out of the basement.

Cooperative Ads Created More Receptive Image for Oregon HBA Members

The Home Builders Association of Josephine County, OR, was looking for a way to help its members advertise more consistently and afforably in the local newspaper. So last year, according to executive officer Dawn Sells, the assocation incorporated several NAHB-developed homeownership ads and created "gang ads" to increase awareness and bolster a favorable image for the association and its members.

The association paid for the header and footer of each ad, which was used to promote association activities such as home shows and holiday events. Members of the HBA then were invited to buy space in the ad to promote their own companies. Prices started at as little as $17 for their portion of the ads.

Sells noted that new member applications spiked with the inclusion of the NAHB ads, and that both association members and the community at large responded with a tremendously positive reception.

"When I started including the ads from NAHB, we were overwhelmed by the reaction," she said. "The ads have helped create a more professional image of the home builders association, and our current members have responded with positive comments."

NAHB’s homeownership ads can be downloaded in black and white and color by visiting www.nahb.org/publicaffairs; click on "Public Relations Tools for HBAs" and scroll down until you see "Homeownership Advertisements." For more information about using the ads, e-mail Stacy Hope, NAHB public relations manager, or call her at 800-368-5242 x8132.

eMaritz Provides 10% Discount on Aales Incentive Programs

NAHB has teamed with eMaritz, a division of Maritz Inc., the world’s largest source of integrated performance-improvement, incentive travel and marketing research services. For every sales reward and employee recognition program you launch as an NAHB member, you’ll receive a 10% discount on the program fees.

Go to www.emaritz.com and input your NAHB priority code (A0001) when you register or purchase a program or call 866-362-7489 and identify yourself as an NAHB member to request a demonstration.

Five Cases Receive Support From NAHB Legal Action Fund

During the NAHB spring board meeting in Washington on April 30, the NAHB Legal Action Committee recommended providing grants in support of litigation involving a range of issues of concern to the home building industry:

• In Ohio, the Home Builders Association of Greater Cincinnati and the HBA of Dayton and the Miami Valley have challenged a telecommunications impact fee imposed by the City of Lebanon. Before they can receive a building permit, builders are required to connect to a city-owned broadband utility telecommunications system and pay a $1,250 fee for each unit, whether or not the owners of the home intend to use the service. The HBAs have filed a lawsuit seeking a permanent injunction against the fee.
• The HBA of Northern California is challenging a Fish and Wildlife Service (FWS) listing of the California tiger salamander in Sonoma and Santa Barbara Counties as both a distinct population segment and an endangered species. The association is petitioning the court to find that these determinations are arbitrary and capricious and hopes to build upon legal victories in pygmy owl and salmon cases.

• The BIA of San Diego continues its legal challenge against a National Pollutant Discharge Elimination System permit issued by the California Regional Water Quality Control Board under the authority of Section 402 of the federal Clean Water Act. Section 402 permits are required when pollutants, such as sediment, are discharged into “navigable waters.” The BIA is appealing a trial court decision upholding the permit.
• In South Carolina, the Charleston Trident HBA has challenged an impact fee ordinance adopted by the town of Summerville for parks and recreation, fire services, and municipal facilities and equipment. According to the HBA, this case is the first impact fee challenge in the state.

• In Texas, a developer requested that NAHB legal staff write an amicus brief to support his argument that the application of provisions of the Endangered Species Act to karst invertebrates (cave bugs) violates the Commerce Clause of the U.S. Constitution. The 5th Circuit ruled otherwise, and the developer now wants the case to be heard by the U.S. Supreme Court.

All five of the recommendations for assistance from the NAHB Legal Action Fund were approved by the NAHB Executive Board.

Applications for funding from home builders associations and members who are involved in legal cases of common importance or national significance to the home building industry are reviewed three times a year during NAHB board meetings.

The deadline for Legal Action Fund applications for the fall board meeting in Columbus, OH, is Aug. 23.

For grant applications and guidelines, association members can click here. For further information on these grants, e-mail Mary Lynn Pickel, NAHB’s director of legal services, or call her at 800-368-5242 x8485. For information on submitting an application, contact Jon Luther, staff counsel, x8329.

NAHB, NACo Leaders Agree to Work Together on Common Concerns

Coming out of a joint leadership summit on May 12 in Chicago, senior officers of NAHB and the National Association of Counties (NACo) announced that they have agreed to cooperate on research initiatives, streamlined development approvals and workforce housing.

“This was a very fruitful discussion,” said NAHB Bobby Rayburn. “Home builders and county executives are facing many of the same challenges, and it just makes sense for us to work together to address our mutual concerns.”

NAHB Vice President and Treasurer David Pressly and NAHB Secretary Brian Catalde joined Rayburn at the meeting. NACo was represented by all of five of its senior officers, including President Karen Miller and President-Elect Angelo Kyle.

"NACo could not be happier with the summit and the strong relationships we are building with President Rayburn and the leadership of NAHB," said Miller. "We're really working hard on issues of mutual interest to county officials and home builders, and making progress on a host of issues — including workforce housing, planning and the regulatory climate.

"Most importantly, through these leadership summits we've built a strong foundation of mutual understanding and respect that can survive the inevitable disagreements that will come up from time to time. We've learned to work together when we agree, and we've learned how to still make progress even when we disagree. As a result, both NAHB and NACo are becoming better and better at meeting the full range of our members' needs."

The issues on which NAHB and NACo agreed to cooperate include:

• Working to ensure that the secondary mortgage market remains strong and dynamic
• Potential joint research on storm water runoff best practices
• Studying the feasibility of a quality assurance/quality control program in which builders could be certified as using construction best practices and participating counties would offer certified builders an expedited inspection process

The two organizations also discussed an innovative pre-application process that would save developers time and money on development approvals while also increasing citizen and county input in the planning phases of a development. Other topics addressed by the senior officers included innovative infrastructure finance mechanisms as an alternative to impact fees and ways of increasing the supply of housing that is affordable for working families.

“To the extent that we can bring these two great organizations together to tackle common problems, we can bring real benefits to counties, to home owners and to home builders,” Rayburn said. “This is a strong partnership because it is a productive partnership.”

The senior officers of both organizations said that they hope to meet again before the end of the year to seek more progress and specific action on some of these issues. This could include a joint NACo-NAHB presentation at NAHB’s State and Local Government Affairs Conference on Nov. 5 in Biloxi, MS.

There is also a possibility of NAHB participating in a roundtable discussion of regulatory barriers at NACo’s annual meeting in Phoenix later this year.

New Mortgage Aims at Overcoming Common Obstacles to Obtaining a Mortgage

A new, innovative Optimum Loan from Countrywide Home Loans, Inc. provides special features to help eligible borrowers overcome some common obstacles to qualifying for a mortgage.

The loan program is being rolled out to mortgage brokers on a staggered schedule through the company’s wholesale channel and should become fully available in the near future, Countrywide announced last week.

The program’s features include:

• Payments for rent, utilities, telephone or even cable television can be used to establish a favorable credit history.

• Cash savings arrangements within a community or family can be used as a downpayment source.
• Income from child care, cleaning services, auto or home repair or other hard-to-verify sources can be considered.
• Income from non-occupants of the home can be included to help meet income qualifications for one-unit properties.
• Rent being paid to the borrower by a live-in boarder for at least 12 months can be considered.

Among those who can benefit from the program, says Countrywide, are single parents and families with household members whose individual incomes may be modest, but whose combined household income enables them to buy a home.

Fixed- and adjustable-rate loans are available under the program. Maximum loan amounts are up to the conforming limits for one-unit through four-unit properties. One-unit properties are eligible for 100% financing.

The Optimum Loan is part of Countrywide’s effort to fund $600 billion in home loans to previously underserved Americans by 2010.

For more information, click here, or call 800-747-1871.

National Housing Conference to Honor Angelo Mozilo for Lowering Homeownership Barriers

Angelo Mozilo, chairman and CEO of Countrywide Financial Corporation, will receive the National Housing Conference (NHC) 2004 Housing Person of the Year Award in recognition of his long-standing commitment to reducing the barriers to homeownership for lower-income and minority individuals and families.

A dinner honoring Mozilo will be held at the National Building Museum in Washington, D.C. on June 9. Participants will be invited to attend a policy forum the following morning, which will feature the release of a new issue of NHC Affordable Housing Policy Review. The publication focuses on private sector participation in affordable housing and community development activities.

Participants will also have access to the museum’s new exhibition, “Affordable Housing: Designing an American Asset.” The exhibit features 18 projects across the country in a range of urban and rural settings illustrating how well-designed affordable housing development can be an asset to the community.

Mozilo co-founded Countrywide in 1969 and it has become a global diversified financial services provider. Initiated in 1992, Countrywide’s We House America program has been responsible for more than $245 billion in financing to minorities, low-income borrowers and individuals who live in underserved communities.

Last year, Countrywide expanded its commitment to fund $600 billion in home loans through 2010. Its comprehensive approach to affordable lending includes education and outreach and the company is one of the leading lenders in the nation to African-Americans and Hispanics.

Mozilo is a former president of the Mortgage Bankers Association and he continues to serve on its board of directors. He is also a member of the board of trustees of the National Housing Endowment, the philanthropic arm of NAHB, and is on the board of the Joint Center for Housing Studies of Harvard University. He is also an inductee in the National Housing Hall of Fame.

About 1,000 leaders in the housing industry are expected to attend the dinner honoring Mozilo. To attend, click here, or call 202-466-2121 x221.

Plant Tour to Visit Midwest Production Facilities

A plant tour on May 23-25, sponsored by NAHB’s Modular and Panelized Building Systems Councils, will take attendees behind the scenes at seven production facilities in northern Indiana. On the itinerary will be four modular producers, a wood and panel producer, a housing industry products manufacturer and one of the country’s leading ready-mixed concrete manufacturers.

Registration is open through this Wednesday, May 19.

Networking opportunities at the annual event include the popular Plant Tour Golf Tournament on Sunday morning, a Sunday night welcome reception and an annual banquet on Monday.

Based at the South Bend Riverfront Marriott, the tour is a must for builders who are interested in learning more about how modular and panelized home building can boost their profits.

For this year’s event, the Building Systems Councils has arranged special tours of All American Homes, Crest Homes, Patriot Homes, Pinnacle Building Systems, Universal Forest Products, LaSalle Bristol and Aggregate Industries.

Registration is available online or by downloading and printing the tour registration form and faxing it to 202-266-8501 or sending it by overnight mail to: NAHB University of Housing; 1201 15th Street, NW; Washington, D.C. 20005

For more information about NAHB’s Building Systems Councils, click here.

Home Builders to Provide Career Training to Mississippi Youth

An award-winning program that trains youth for careers in the construction industry will soon be available in Mississippi through the Home Builders Institute (HBI), the workforce development arm of NAHB.

Starting this summer, Project CRAFT Jackson will be based at the Mississippi Youth Corrections Complex and work with the Mississippi Department of Human Services (MDHS) to provide training and jobs in the local home building industry to young people who are 16-18.

“I am very proud to bring Project CRAFT to my home state of Mississippi,” said NAHB President Bobby Rayburn. “This program has a successful track record in helping young people start careers in the construction industry, and it teaches them the value of community service.”

MDHS Executive Director Don Taylor announced the program at a press conference May 12 in Jackson. “We are extremely grateful to Bobby Rayburn and to NAHB for offering us this opportunity to help adjudicated young people in Mississippi get their lives back on track,” he said.

Reverend John E. Cameron, Sr., of the Mount Calvary Baptist Church welcomed the HBI program and outlined plans for Project CRAFT students to help build affordable housing as part of their training.

HBI’s Project CRAFT (Community, Restitution, Apprenticeship-Focused Training) includes applied academics, employment skills, community service and an overall support system. The program is currently operating in Florida, Texas and New Jersey through state and local agencies; in Tennessee, it is being made possible through a Youth Offender Demonstration grant from the U.S. Department of Labor.

Recognized by Congress as a model program in the treatment and rehabilitation of juvenile offenders, Project CRAFT has a proven record in training young people for well-paying jobs. In 2002-2003, graduates enjoyed an 86% placement rate, with an average starting wage of $8.29 an hour.

Project CRAFT students volunteered for more than 28,000 hours in community service projects last year. Recidivism among program graduates has been low, ranging from 6%-15%.

Software Keeps Track of Tools and Equipment

Bosch Power Tools, a division of Robert Bosch Tool Corporation, has announced that it has added ToolWatch® to its Digital Power Tool line. The new software tracking system provides construction companies with a higher level of control over their tools and equipment.

Founded in Stuttgart, Germany, in 1886, Robert Bosch Tool Corporation is a member of the National Council of the Housing Industry — the Supplier 100 of NAHB.

ToolWatch Express can reduce the number of tool thefts on the job site by roughly 96%, the manufacturer says, and companies that have used it report saving tens of thousands of dollars on equipment costs and substantial gains in productivity. Results have shown that even a small specialty contractor can easily save $10,000 in the first year, while typical general contractors save between $50,000 and $200,000 annually, Bosch reports.

ToolWatch allows a company to collect enormous amounts of information about each tool in its inventory by using barcodes and portable scanning devices to deliver tool information back to a desktop computer system, according to Bosch. After applying an identifier to a tool, a company can track its location by job site or by employee.

In the same way the library tracks books, companies can track tools, scanning them in and out of a tool crib, says the company. Suddenly, the timely return of tools becomes a priority for those on the job site, not just those in charge of inventory management.

ToolWatch currently supports more than 3,000 companies with comprehensive solutions including hardware, software and implementation support.

Bosch launched Digital Power Tools in 2002 to help field project managers become more efficient in their work, communicate more effectively with subcontractors and customers and save time and money on the job. 

For more information about ToolWatch, click here or call 800-676-4034.

Two Second-Generation Builders Inducted into National Housing Hall of Fame

Recognizing the lifetime achievements of two of the housing industry’s most dedicated professionals, NAHB inducted home builders Donald D. Martin, from Albuquerque, NM, and Leonard R. Sendelsky, from Colonia, NJ, into the National Housing Hall of Fame on May 1 during its spring board of directors meeting in Washington, D.C.

“Each of these men has made a vital and lasting contribution to the home building industry throughout the course of their illustrious careers, and they are uniquely qualified to become the newest members of the National Housing Hall of Fame — which is the highest honor the housing industry bestows,” said NAHB President Bobby Rayburn.

Donald D. “Don” Martin is a second-generation home builder who grew up in rural Kansas and flew jets and helicopters for the U.S. Marine Corps before beginning his career in the housing industry in the mid-1960s. During the next 30 years, he built more than 9,000 homes in Colorado, New Mexico, Texas, Virginia, Maryland and Arizona. Martin opened his own home building company in Albuquerque in the mid-1980s and built single-family homes and developed lots for other builders there and in Santa Fe.

He served as president of the New Mexico Home Builders Association in 1979, the Home Builders Association of Metropolitan Denver in 1986 and NAHB in 1998.

A longtime advocate of affordable housing, as NAHB president he worked with Fannie Mae to establish 40 locally based partnerships for affordable housing across the country. As a result of this effort, Fannie Mae has invested several billion dollars in the economy of New Mexico alone.

Martin also led NAHB’s effort to successfully increase FHA loan limits and expand homeownership opportunities, and he helped initiate studies at various universities — including Harvard’s Joint Center for Housing Studies — to demonstrate the positive effects of homeownership on the community.

Martin serves on Fannie Mae’s Housing Impact Advisory Council and he is a trustee of the Home Builders Institute and a member of the National Housing Center Board of Governors. He has also actively promoted U.S. home building in international markets and chaired the Department of Commerce’s U.S.-China Residential Building Council in 2000.

Leonard R. “Lenny” Sendelsky, also a second-generation home builder, was born in Perth Amboy, NJ, and formed the Lenguy Construction Corp. in 1958. During his nearly 50 years in the industry, he has overseen construction of more than 3,000 homes and apartments in addition to many commercial and industrial buildings.

Sendelsky has been a board member of the Central Jersey Builders Association for the last 46 years and was its president in 1964. He was named “Builder of the Year” by that association in 1966 and 1989 and by the New Jersey Builders Association in 1967 and 1989. He became a member of his state association’s Builders Hall of Fame in 1974.

Sendelsky was a founding director and the first president of the Home Owners Warranty Corp. of New Jersey in 1975, and he was re-elected to the presidency of that organization from 1983-85. He also helped found his state association’s Institute of Multifamily Housing, which he served as chairman from 1986-87.

Sendelsky served with high honors on the boards of many New Jersey governmental agencies, including the New Jersey State Uniform Construction Code Advisory Board, the New Jersey Standards Committee for Construction of Sewerage Facilities for Realty Improvements, the New Jersey State Building Authority and the Middlesex County Planning Board.

He has an extensive record of service to his community, including membership on the boards of the Thomas Edison Council, Perth Amboy YMCA, Middlesex County United Way and John F. Kennedy Medical Center Hospital.

“For their steadfast commitment to their industry and their local communities over the years, Don and Lenny have earned the highest respect and admiration of their peers and colleagues,” Rayburn said. “They have truly attained the right to be included among the most distinguished ‘housers’ in the country as part of the National Housing Hall of Fame.”

Photos by Herman Farrer

Student-Built Dream Home Features Environmentally Friendly Design

An ecologically friendly “Dream Home” built by students enrolled at the Loraine County, OH, Joint Vocational Schools has been a featured stop on the Parade of Homes tour of the North Coast Building Industries Association for the past two weekends.

About 70 students in carpentry, electricity, plumbing and pipefitting, heating and air conditioning and masonry participated in the home’s design and construction, a process that began during last year’s spring semester. Ground was broken in September on a lot in Carlisle Township owned by the builders association.

“A special effort was made to ensure that the home was designed with green building concepts,” said Jean Sexton, executive officer of the association. “That means the home is built to be energy-efficient and environmentally friendly.”

Although local builders had previously featured high efficiency geothermal heating and cooling systems in model homes on the tour, this is the first parade home that was designed from a Built Green checklist of sustainable technologies, products and practices.

Materials with recycled content were incorporated wherever possible, and the home used “hearty plank” siding made of recycled cement and fast-growing bamboo for some of the flooring. The home meets the Environmental Protection Agency’s Energy Star program requirements, making it 30% more efficient than a home meeting the Ohio Model Energy Code.

“One important result of the partnership efforts of the Dream Home is the education of not only students, but local builders, suppliers and the general public about new construction techniques and materials and how the buildings in which we live and work affect the environment around us,” said Sexton.

The project was conceived by association member Calvin Smith, the owner of Calvin Smith Builders, Inc. Other participating organizations were the Lorain County Metro Parks, the Lorain County Chamber of Commerce and the Lorain County Commissioners.

The home is open for one final weekend, May 22-23, from noon to 5 p.m. For more information, click here.

NCHI Celebrates 40 Years at NAHB

 The National Council of the Housing Industry (NCHI) — the Supplier 100 of NAHB — is celebrating its 40th anniversary this year. NCHI is a special standing committee that gives leading building suppliers and service providers the opportunity to contribute to and particpate in NAHB activities and issues.

About three-quarters of NCHI's 94 member companies exhibit at the International Builders' Show each year, renting an incredible 45% of the show floor.

NCHI members also have supported the development and renovation of the National Housing Center and they have regularly sponsored The New American Home (the official show home of the NAHB convention) and supported builder education programs, NAHB's biannual Construction Forecast Conference, various smart growth efforts and student chapters of the Home Builders Institute.

For more information, e-mail Barbara McMurray or call her at 800-368-5242 x8243.

Digital Delivery Provides Electronic Access to Contracts, Checklists, More

Digital Delivery, a new service from BuilderBooks.com, gives builders, contractors and other industry professionals electronic access to a variety of publications they may want to purchase and customize for their businesses, including checklists, specifications, contracts and change orders.

Digital Delivery enables purchasers to download the documents directly to their desktops and then customize the documents by adding their company’s logo, etc.

Digital Delivery is part of the purchase process for certain documents including:

• Trade contractor checklists — concrete, excavator, framing carpenter, framing, production scheduling and roofing
• Trade contractor specifications — clearing, concrete, framing material, land work, masonry and roofing
• Contracts — change order, cost-plus, fixed price, professional services agreement/design agreement and spec home in progress fixed price
• Construction management — house setting checklist, job folder order checklist, job status schedule report, plan review checklist, pre-construction meeting procedures, trim order checklist and trim order procedure
• Seniors housing — “Approving Seniors Housing — Facts That Matter”

To use Digital Delivery, go to BuilderBooks.com and click Digital Delivery. Follow the easy how-to instructions to complete the purchase. Digital Delivery will prompt you to download your document choice and save it to your desktop.

Calendar of Events

May 23-25, 2004	2004 Building Systems Councils Plant Tour	South Bend, IN
August 24, 2004	2004 EOC Seminar	Destin, FL
August 26, 2004	2003 EOC Association Excellence Awards	Destin, FL
September 15, 2004	Innovation in Workforce Housing Awards	N/A
September 29- October 3, 2004	NAHB Fall Board of Directors Meeting	Columbus, OH
October 7-9, 2004	The Remodeling Show	Chicago, IL
October 9, 2004	CADRE	Chicago, IL
October 9, 2004	Remodelor™ of the Year	Chicago, IL
October 23, 2004	National Conference on Membership	Memphis, TN
October 27, 2004	Fall Construction Forecast Conference	Washington, DC
October 31- November 3, 2004	Building Systems Councils SHOWCASE	Austin, TX
November 4-6, 2004	State & Local Government Affairs Conference	Biloxi, MS
November 7, 2004	2nd International Housing Conference of the Americas	Mexico City, Mexico
November 12-14, 2004	Custom Builders Symposium	Indian Wells, CA
January 12, 2005	Best in American Living Awards	Orlando, FL
January 13, 2005	techHomExpo	Orlando, FL
January 13, 2005	The International Builders' Show	Orlando, FL

To view more meetings & events information on the NAHB Web site, click here.

Make Your Connection With www.nahb.org

Make your connection to the latest housing industry news and information with www.nahb.org — the official public and members-only Web site of NAHB.

Log in today to register for educational seminars, meetings and networking events; find important economic and housing data; and learn the latest developments in NAHB’s efforts to promote housing. It’s all available to you 24 hours a day at www.nahb.org. Just click the "Member Log In" button to get started.