Nation's Building News Online: November 1, 2004

Print All Articles Text Version

Sponsored by Countrywide Home Loans National Builder Division

Housing Expected to Flatten Out From Record Levels in 2005 While Jobs and Economy Grow

Activity in the nation’s booming housing industry has reached its peak but should hold up at fairly robust levels into 2005, according to the consensus of economists participating in NAHB’s Construction Forecast Conference at the National Housing Center in Washington, D.C. on Oct. 27.

Panelists were largely optimistic about prospects for the residential construction industry, economic growth, job growth and inflation as the Federal Reserve continues to gradually push up interest rates and the fiscal stimulus of the Bush Administration’s tax cuts begins to fade.

High oil prices were identified as the wildcard in the scenario. While hard to predict, energy costs were expected to subside next year from today’s record levels after taking a small bite out of economic output and consumer confidence in the short term.

“The housing market has been nothing short of phenomenal, especially anything that smacks of homeownership,” said NAHB Chief Economist David Seiders. But the nation’s housing market is in the process of “reaching its limits” and “topping out.”

With activity “flattening in 2005,” Seiders is forecasting a decline in housing starts next year of about 4.2% to 1.85 million units, down from the 1.935 million starts projected for this year. Sales of new single-family homes are forecast to drop 5.2% from a record of more than 1.16 million this year to about 1.1 million.

Single-family production is poised to set another record this year, Seiders said, and the fundamentals of the market will remain good in 2005 even though some households may have moved up their home-buying plans from next year to this year when they saw mortgage interest rates starting to rise. With inventories lean and demand continuing to ride high, the single-family market “hasn’t sewn the seeds of its own destruction,” he said.

Multifamily production continues at an annual pace in the 340,000-unit range, he said, even though demand in this sector has been softened by the allure of homeownership for renter households. Rental vacancies were down a bit in the third quarter, he noted, but remained near record levels, and condominiums have been on an upswing.

With the tremendous rise of home equity, which is approaching $9 trillion, Seiders said that home owner expenditures for additions and alterations should keep the residential remodeling industry growing next year. Annual volume is currently in the $220-$225 billion range.

Looking at household formations and immigration growth, he gauged demand for single-family and multifamily housing at an annual average of 1.8 million units through 2013.

Maury Harris, managing director and chief economist for the Americas for UBS Warburg Research, said that the economy has now built up a head of steam from the fiscal and monetary policies that were used to rally businesses from the technology sector crash, 9/11, corporate scandals and the invasion of Iraq.

U.S. Economy Getting Back to 'Its Old Self'

“The U.S. economy usually doesn’t need that much help in the first place,” and can run on its own “once the ball gets rolling,” Harris said. With better job and income formation and consumer spending coming into play, he said there is currently “a transition from a policy-driven economy to an economy that’s getting back to its old self; it’s on its own again.”

Growth in the Gross Domestic Product will decline from about 4.3% this year to 3.2% next year, he said, which will be good enough to stabilize the unemployment rate around 5.2%-5.3%. With the effects of strong worker productivity gains in recent years fading, he forecast that monthly payroll growth would average 150,000-175,000 during the year ahead.

Following disappointing job growth in September related to hurricanes in the Southeast, he predicted that the Labor Department will report the creation of 225,000 new jobs in October when it announces its workforce statistics on the Friday following the elections.

Harris noted that low-wage jobs had been growing faster than jobs paying better than average until this summer, when the two started growing at about the same pace, and that the hemorrhaging of high-paying manufacturing jobs to overseas has stopped, which he called “a step in the right direction.”

He said that about 1.5 million jobs had been outsourced over the past four years, but the savings from that outsourcing had actually contributed to business growth and that 60%-75% of companies eliminating jobs in some areas were simultaneously adding new ones in others.

One way or the other, Harris said that oil prices would retreat next year, getting back down to about $35 a barrel: either supply constraints will ease or prices will continue at a lofty level until they discourage demand.

Long-Term Interest Rates Heading Up

Along with his co-panelists, Michael Moran, chief economist of Daiwa Securities America, said that long-term interest rates will be heading up next year as the Fed continues to boost the federal funds rate. That rate will be 2% at the end of this year and 3.25% at the end of 2005, he said; Harris predicted it would be 4% by the end of next year and Seiders forecast it would be 3.75%.

Moran said that keeping stimulative monetary policy in place would have created “genuine inflation problems” in a year or two, and in aiming for neutrality the Fed will want a real federal funds interest rate of 2.5%-3.5%, which would be a nominal rate of 4.5% at today’s rate of inflation. “It does not need to get there quickly,” he said, but the Fed can’t allow the rate to sit at its current 1.75%.

Rising interest rates shouldn’t put much of a squeeze on consumers, he said, because “most of the debt of the household sector is fixed-rate so you don’t see it rolling into higher interest rates as the Fed tightens.”

Households remain in fairly decent financial shape, Moran indicated, despite current high levels of their debt payment burden. Current readings of those statistics are not comparable to historic readings, he said, because the homeownership rate is higher, people increasingly use credit for convenience so they don’t need to carry cash and lenders are technologically better able to make loans.

Reaching a similar conclusion on household debt, Harris noted that “we have become a more prosperous economy,” with steady improvements over time in real incomes and the standard of living that are associated with spending a smaller fraction of income on necessities, enabling households to qualify for more borrowing.

Consumer delinquency rates have not gone up, the panelists noted.

NAHB is forecasting that fixed-rate mortgages will average 6.5% in 2005, up from 5.9% this year, which would leave the cost of home financing at relatively affordable levels.

Photos by Morris Semiatin

Building News Coast To Coast

Snazzier Houses Bring Energy Crisis Home to Middle Class

The cost of home heating oil has risen 60% in the last year; while propane and natural-gas prices are up 30% and 11%, respectively. With the average-sized abode expanding from 1,500 square feet in 1970 to 2,230 sq. ft. last year, upper- and middle-class families are just as likely as the poor to be burdened with high heating bills. Not only are homes larger than they were three decades ago, they also now boast several refrigerators, plasma TVs, lap pools, multiple-head showers, numerous dishwashers, Jacuzzis and other appliances that gobble up electricity and hot water. In fact, hot water accounts for 40% of home heating bills. Home owners also must keep in mind that plugged-in cell-phone chargers, microwaves, stereos and computers consume energy even when they are not in use. According to the American Council for an Energy Efficient Economy, the amount home owners spend on automobile and home-heating fuel has surged from an average of $6,000 to upwards of $9,000 over the last four years.
Christian Science Monitor (10/28/04) P. 1; Scherer, Ron: www.csmonitor.com

At Home on Earth

Architects increasingly are turning to sustainable design, which involves minimal use of natural resources during construction. Interest in sustainable design can be tied to high fossil-fuel costs and concerns about global warming. Sustainable structures are comprised of recycled materials, such as wood frames made from old railroad ties; straw insulation; concrete made from scraps of carpet and metal; and wall panels comprised of soy, sunflower and wheat plants. According to architect Bill Dunster, sustainable design aims to "create a new way of living and working that's so appealing people will chose it above the alternatives." Sustainable features are being incorporated into new dwellings across the globe, with a slew of directives and pilot projects. Existing dwellings also will be improved through the addition of rainwater tanks and energy-efficient insulation, among other things.
Newsweek (10/25/04) P. 41; Pepper, Tara: www.newsweek.com

Western Red Cedar Stakes a Claim as Preferred Wood in Homes

The Western Red Cedar Lumber Association (WRCLA) touts western red cedar as home owners' top choice for decorative wood both inside and outside of their dwellings. Aside from its aesthetic qualities, WRCLA's Peter Lang notes that cedar's ability to remain stable, with less swelling, warping or twisting; to be painted or stained easily; and to avoid rot and decay for longer periods of time gives it an edge over other types of softwood. Because it is naturally less susceptible to deterioration, cedar does not require treatment with chemical protectants and is therefore more environmentally friendly than other alternatives. Specifically, Lang compares the use of cedar in deck construction with that of composite materials made of plastic and wood chips; cedar, Lang says, is just as easy to maintain in addition to being a more renewable resource than composites.
Associated Press (10/25/04) Bradley, David: www.ap.org

Rate Protection for Home Buyers — And Builders

Fears of dramatic boosts in mortgage rates have scores of buyers entering the housing market, mainly because even a modest gain in borrowing costs can block some from homeownership. Builders are worried about higher rates as well, especially now that shortages of materials and skilled labor are extending completion dates. As a hedge against higher mortgage rates that could result in lost sales, many are offering so-called "forward commitments." Such agreements allow buyers using the builder's preferred lender or in-house mortgage company to close a deal three months to a year or more down the road at today's rates. Forward commitments are similar to the rate locks or rate commitments offered by most lenders, and buyers who choose an outside lender may want to consider this option as well. Before agreeing to a rate lock, borrowers should determine the cost and length of the lock and find out what happens if the sale is cancelled, the lock expires or mortgage rates plummet while the lock is in effect.
Chicago Tribune (10/24/04) P. 5B; Sichelman, Lew: www.chicagotribune.com

Families, Retirees Moving to 'Cohousing' Neighborhoods in Search of Community

Home buyers who want to interact with their neighbors and enjoy a sense of community increasingly are turning to cohousing. These developments involve dwellings built in close proximity to one another and a community center, where residents share meals and activities. Residents own their homes and work together on maintenance and landscaping tasks. More than 65 cohousing developments have been erected nationwide since 1991, with 60 more in the works; California, Massachusetts, Washington, Oregon and Colorado boast the most cohousing neighborhoods.
Associated Press (10/23/04) Gartner, Erin: www.ap.org

Green Housing Effect

Several multifamily, environmentally friendly buildings are popping up in New York City and in other areas of the country. The Solaire, located in Battery Park City, was the first multifamily green structure in the nation. The units rent for $2,600-$8,500 per month; and residents enjoy filtered air and water, among other things. Green buildings often boast solar panels, rooftop gardens, radiant floor heating, recycled or renewable materials and energy-efficient windows and appliances. According to the U.S. Green Building Council, green components can boost construction costs by as much as 7%, but the additional costs usually are recouped in a few years. Green construction offers tenants healthier homes; and builders benefit, as well, in the form of lower-priced recycled materials and tax credits.
New York Newsday (10/22/04) P. D5; Geller, Martinne: www.newsday.com

Theft From Work Sites Frustrates Contractors

Roughly $1 billion of construction equipment and tools are stolen every year from construction sites in the United States, with a recovery rate of less than 50% of the stolen items, according to the National Insurance Crime Bureau. The thieves include professional criminal rings, contractors' employees and competing contractors, and the equipment that is being stolen includes big-ticket items like dump trucks, trailers, excavators and Bobcats. In Delaware County, OH, construction-site theft has worsened over the past decade, authorities say, coinciding with a construction boom in the south part of the county. Many construction builders decline to report their losses out of fear that their insurance companies will drop them, making it difficult to place a price tag on the true costs of construction theft. Three years ago, Delaware County contractor Gary Sergent reported the loss of a 24-foot-long equipment-laden trailer, prompting his insurance company to drop him; Sergent was only recently able to find another insurance company that would accept him. Home builders require many pieces of equipment, and removing all the equipment from work sites after the end of every workday is so time-consuming — and therefore costly — that most contractors simply leave the equipment on-site overnight, explains Sergent. Sergent says he has found that implementing security measures like floodlights at the sites has proven ineffective, and hiring private security is not cost-effective. Mitchell Maddox, risk-control manager at Westfield Insurance, advises contractors to lower the odds of theft by ranking the risk levels of their equipment, removing "targeted theft items," and installing tracking devices on their equipment.
Columbus Dispatch (OH) (10/25/04) Hawes, Jane: www.columbusdispatch.com

Soaring Material Costs Hit Buyers

Builders in the Virginia area say that the ongoing increase in the cost of building supplies has pushed up the sale prices of new homes, thanks to national shortages in supplies and higher land prices. "Overall, all these prices added together could have increased the sales price of homes... by 5%," says Tidewater Builders Association President John W. Iuliano. The cost increase for materials is blamed on China, which is absorbing international supplies. Wood prices went up due to the recent hurricanes, says Joey Corp.'s Sam Cohen, and higher petroleum prices are also a factor. "Builders are also having to deal with land shortages," says WATAB Construction's Bill Brice, and Iuliano notes that builders are sometimes paying half as much for a lot now as they would have 18 months ago.
Chicago Tribune (10/23/04) P. 17; Snider, Jody: www.chicagotribune.com

A Better Breed of Stock Plans

In the past, only the most affluent home buyers had access to plans crafted by renowned architects; but some well-known professionals now are offering blueprints, drawings and sketches on the Internet for those who want more than standard, cookie-cutter stock dwellings but do not have the deep pockets for a custom design. These newer plans have improved architecture, historical accuracy and custom-home details compared to what currently is available in home centers and bookstores; and while they can cost a few thousand dollars, it is much cheaper to purchase the stock plans than to work with the architect directly. Russell Versaci, Gregory La Vardera, Ross Chapin and the Bungalow Company are among those selling their new line of plans online. Buyers also have access to designs for environmentally friendly housing through Healthy Home Designs. However, these innovators are the exception rather than the rule. Most architects do not sell their stock plans because they fear raising the bristles of their wealthier clients, who generally shell out more than $10,000 on design fees alone and may be irritated to see a similar design later on a much less expensive property.
This Old House (10/04) No. 82, P. 164; Akst, Daniel: www.pbs.org/wgbh/thisoldhouse

Lighten Up, Road Warriors

There are several gadgets on the market that help mobile workers lighten their loads. They can replace bulky laptops with lightweight handhelds that boast phone and e-mail capabilities. One such device is palmOne's Treo 600, which weighs in at just six ounces. Those who need a larger keyboard might want to consider Sharp's Actius MM20P, which features a 10-inch screen, 20-GB hard drive, built-in Wi-Fi and USB ports to link to their primary computers. The $1,600 machine weighs only 2.6 pounds. Mobile workers also have access to portable printers, such as the 4.6-pound, BlueTooth-equipped Deskjet 450 from Hewlett Packard. Finally, those who want to eliminate as many wires as possible should purchase the Targus World Pack Travel Connection kit.
Business Week (10/25/04) No. 3905, P. 110; Edwards, Cliff: www.businessweek.com

Don't Risk Data Disasters

Imation's Robert Herman says businesses could be forced to close their doors if they do not have adequate data backup in the event of a disaster. However, many small businesses do not think they need formal backup plans. Herman recommends basic backup tools for companies with less than 100 GB of storage space, such as CDs, DVDs, USB flash drives and tape cartridges. They can be used to back up laptops, desktops and servers; and they should consider system compatibility and storage requirements when choosing which to use. Small businesses must figure out what data they need to stay in business and implement a plan to protect it. They should back up the data every day and check their data restoration capabilities every three months. Finally, they should store all CDs, DVDs and other removable media in an off-site location.
Office Solutions (10/04) Vol. 21, No. 5, P. 13: www.os-od.com

Remodelers in Chicago Working to Finish HomeWise Renovation in Time for Thanksgiving

On hand last month to recognize a HomeWise renovation project in Chicago, representatives from the Department of Housing and Urban Development and NAHB were among those who toured a home that will be sold to a deserving family after it is remodeled.

More than 20 Chicago families, who had entered their names in a lottery for the house, participated in the tour, which was led by the builder who is remodeling it, Dan Griffin, chairman of the Home Builders Association of Greater Chicago.

“This is the beginning of something great,” said NAHB President Bobby Rayburn. “This home in Chicago is one of the first to be renovated and sold at a discount as part of the HomeWise program.”

Other visitors to the home in Chicago included Doug Sutton, Sr., chairman of the NAHB Remodelors™ Council; Dennis Shea, HUD's assistant secretary of policy development and research; and Jim Linnane, a Wells Fargo Home Mortgage division manager.

Under the HomeWise program, the National Housing Endowment is purchasing 10 HUD homes across the country and then working with local NAHB Remodelors™ Councils on their renovation using in-kind donations of labor and materials as well as donations of $100,000 from both Fannie Mae and Freddie Mac.

Included in the improvements to the three-bedroom house in Chicago, said Griffin, will be new exterior siding, new carpeting, a new kitchen, new bathroom fixtures and a fresh coat of paint throughout the interior.

“It might seem like an easy thing to do — to renovate an older property, spiff it up and get it into the hands of a deserving, counseling-certified family, but let me assure you, there’s a lot going on behind the scenes,” Rayburn said.

“This wouldn’t be possible without the help of all the HomeWise partners, especially the ones at the ground level — the people you will see at work: the participating members of the HBA of Greater Chicago’s Remodelors™ Council and Remodelors™ Council member Dan Griffin,” he said. “Dan and his company, Griffin & Associates, are to be commended for taking on this project. These folks are the experts at taking a property and making it into a true home for the family that’s fortunate enough to move in here.”

To be eligible for the program, families must be first-time home buyers who have completed an approved housing counseling course and earn 80% or less of their area’s median income. Once selected, buyers will be required to sign a 15-year mortgage that is at or below the market rate, for an amount that is one-half of the home’s appraised value. They will also be required to sign a lien for the balance of the appraised value, which will be forgiven if they remain in the home and make timely payments for five years.

According to Griffin, his group hopes to complete the project in time for the winning family to celebrate Thanksgiving in their new home.

Housing Snapshot

Mortgage interest rates slipped downward again last week, reaching their lowest levels in roughly six months, Freddie Mac reported, a further sign that new home sales and single-family housing construction will set new records this year. General economic news for the week was good, as well. The economy grew by 3.7% in the third quarter, up from 3.3% in the second quarter, but a bit lower than many economists had predicted. The Commerce Department reported a 0.6% increase in consumer spending in September, following a 0.1% decline in August. However, after-tax incomes increased by only 0.1%, raising some concerns that the consumer buying spree will be unsustainable without more lift from the jobs market. Unemployment claims increased by 20,000 last week. The manufacturing sector grew for the 17th consecutive month in October, although at a slower pace than the month before. News on the lumber front was largely good. Framing prices dropped from $365 per 1,000 board feet to $358, compared to $321 a year earlier, according to Random Lengths. The price of 15/32-inch 3-ply Southern (west-east) exterior sheathing fell from $290 to $280 per 1,000 square feet, compared to $520 for the same week last year. Oriented strand board rose from $215 to $230, but was still far below the $465 charged a year earlier.

Mortgage Interest Rates

30 Year Fixed Rate: 5.64\%
15 Year Fixed Rate: 5.01\%
1 Year ARM: 3.96\%

Housing Starts: Sep. 2004

Total: 1.898 million\%
Single Family: 1.540 million\%
Multi Family: 358,000\%

New Home Sales: Sep. 2004 *

1.206 million

Existing Home Sales: Sep. 2004 *

6.75 million

* Seasonally Adjusted Annual Rate

Make Housing a Winner on Election Day

The Nov. 2 elections (this link is for NAHB members only) are fast approaching, and it’s time for you to do your part to ensure that housing is a winner when the votes are tallied.

Where the candidates in local, state and national races stand on housing provides an important measure of their fitness for office. As a member of this industry, it is incumbent upon you to find out where the candidates stand on the housing issues and to share that information with your friends, neighbors, business associates and customers.

Housing issues are figuring prominently in this year’s presidential and congressional elections. That is no small tribute to the power that home building has demonstrated recently in leading the nation’s economy to higher ground and in increasing the financial health of the record number of American families who are home owners today. It is also an indication of the growing concern in this country over the need for affordably priced housing that will enable our workforce to live in or near the communities they serve. And it is a result of the ongoing efforts of NAHB to ensure that housing receives the prominence it deserves in the current election cycle.

To promote a national housing agenda this summer, NAHB supplied a housing policy agenda for the platform committees of both political parties, and we established a notable presence at the Democratic and Republican national conventions. That included a series of ads in special daily convention issues of the National Journal that made a highly favorable impression on the lawmakers and delegates attending those events. We also hosted receptions for congressional leaders and cosponsored media briefings. We supplied a housing policy agenda for the platform committees of both political parties.

To let our members know the positions of the two presidential candidates on issues that are important to us, we asked President George W. Bush and Sen. John Kerry several questions, and we have published their responses in a special report. At our board of directors meeting in Columbus, Ohio, on Nov. 2 we heard directly from the President about how he intends to increase housing opportunity in this country. For yet more information on the full range of housing policies that need to emerge from the elections, NAHB and four other national groups in Washington have put together a consensus report describing those issues in great detail. All of this is information that will help you make the right decisions for the housing industry and your business on election day.

As the elections enter their final days and weeks, this is also a time for participating in the grassroots campaign efforts that are occurring across the country. Here’s how you can help make a difference:

• Encourage your family, friends, employees, HBA members and their subcontractors to get out and vote.
• Sponsor a fundraiser for your candidate.
• Recruit HBA members and employees to volunteer their time for campaigns.
• Make, distribute and place campaign signs.
• Make phone calls for your candidate.
• Deliver campaign literature door-to-door.
• Assist with campaign events.

Don’t let this political season pass you by. Housing is a major concern of America’s electorate and it is an issue that commands the support of men and women on both sides of the political aisle. This is your opportunity to ensure that when the ballots are counted on Election Day, they will spell victory for the candidates who stand tallest for housing and the American dream.

Letters to the Builder's Engineer — On Business Partnerships

Restoring One’s Faith in Business Partnerships

As everyone else, I routinely glance at my NAHB e-mail newspaper headlines and sometimes actually read a few. I have never, even upon invitation, been compelled to respond until now. After reading your article on business partnerships (“What Is the Optimum Shelf-Life of a Business Partner?”; Oct. 25) I felt I had no choice but to write. What a negative description of our business society and humanity in general! I would hope that you can substantiate your opinions well beyond the business life experiences of “Timultuous” and “Barfo.” I’m wondering if you were conked in the head to begin with, thus beginning the saga of repeated partnering failures. No disrespect intended here, Tim. It just seems such a sad commentary to think that only 10% of all partnerships will survive.

I would like to be the first to help restore your faith in “we” construction types. I am the 48-year-old vice-president and half-owner of Grendahl Construction, a custom home builder in the Sacramento, CA, area that was started in 1973 by Thor Grendahl, Sr., whose son, Steve, took the helm of the family business upon Thor’s retirement in 1980. Steve and I crossed paths in 1987 while I was working on my own as a licensed contractor and sub-contracting my services. I had the good fortune of cutting and stacking a difficult roof structure on a residential remodel for Steve.

Over the next three years when I did several more projects for Steve, coming and going in between, we began to find two things were abundantly clear. First, we both had something the other needed: his talents were in accounting and estimating while mine were solely in the building end of things. And second, which was surprising to both of us, Steve’s reputation and referrals began to have my name attached to them. After one of my departures to take a job as a residential building inspector for the county — which lasted until layoffs came six months later — I asked Steve for some more work. He asked me what it would take to get me to stick around this time and ended up offering me a partnership in the business.

Now it’s time for true confessions: I had been in a previous partnership that lasted for two years, but it was assimilation into a larger company that spelled our end, not disagreement. I did have reservations, nonetheless, so I trusted my gut and shook Steve’s hand. We incorporated in 1993.

Admittedly, it is not always easy. Steve and I have completely different personalities. He’s right-brained and I’m left-brained — the teacher and the drill sergeant working together! We often have to laugh at our sometimes diametrically opposed positions on certain topics. We can be worlds apart in our views on how to approach things, but rarely do we disagree in the end, and that’s because our core values and goals are alike. The fundamentals of integrity and trust come to mind. It is my firm belief that your 90% to 10% partnership failure ratio could be nearly reversed if these fundamentals were applied and adhered to.

A strong partnership is a bonus for the client in many ways. Two heads are better than one. If you alternate vacation schedules, a company owner is always available. Yes, you have to share the profits, but it’s great to know that what ever comes, somebody you can count on has “got your back!”

George P. Henley, vice president, Grendahl Construction 

One of the Lucky 10%

I enjoyed your article, and I will tell you that I am one of the lucky 10% you described. I have had a great business relationship with one individual for some nine years now in a partnership that was formed in less than 24 hours.

I agree with the reasons you cited for forming partnerships, but there is one thing that you may have overlooked. Partners can make up for each others’ deficiencies. I have more of a visionary personality and am not detail-oriented, which has caused me problems in the past. My partner is a doer, on the other hand, but can't plan ahead. As partners, I believe we’ve put together a whole that is greater than the sum of its parts.

Emil Wanatka, president, Timberline Builders; Durango, CO

Not Meant to Last

I had a business partnership once that lasted one year and four months. If it hadn’t been for the one-year warranty, it would have only lasted the four months. Compatibility was definitely not evaluated prior to joining forces. Not that things went bad, but I agree with your article.

Dan Foutz

A Good Match

My partner and I have been in business for 17 years. This will be the final year, since he is retiring. We have never really socialized outside of work, but we maintain a good business relationship. When I formed the partnership, I was matching my weaknesses with his strengths, and vice versa. We have seldom crossed over to the other person’s area of expertise. There may have been occasional differences, but they were quickly resolved through good communication. In any partnership, mutual respect is very important, along with trust. We never had a buy-sell agreement, so it can be done successfully without one.

Pam Guthrie 

2004 Election Night Viewers Guide

An inveterate observer of presidential and congressional races, Pete Rintye, staff vice president of NAHB’s Legislative and Political Relations, has prepared an election night guide that will help television viewers follow the results.

Listed chronologically are the closing times of the state polls as they are currently set for Nov. 2.

Although there is always the possibility of court orders for longer hours or other unforeseen events affecting closing times, the outline below provides a reasonable timeline from which viewers can check for news reports of election results as the polls close. All times are listed as eastern standard time.

Incumbents are listed in the close races to watch for the House and Senate; both candidates are listed in the contests for open seats.

6:00 p.m. — 19 Electoral Votes

Polls close in Indiana and Kentucky (though both states are partially in the central time zone, expect the news organizations to make their projections based on those areas in the eastern zone).

No purple toss-up states here — Bush should win both states decisively. Should Bush lose either, plan for an early night and a Kerry landslide.

Races to watch:

• IN/08: Rep John Hostetler (R)
• IN/09: Rep. Baron Hill (D)
• KY/Senate: Sen. Jim Bunning (R)
• KY/03: Rep. Ann Northop (R)
• KY/04 race for the open seat of Ken Lucas (D): Geoff Davis (R) vs. Nick Clooney (D)

7:00 p.m. — 70 Electoral Votes

Polls close in Florida (except the panhandle), Georgia, New Hampshire, South Carolina, Vermont and Virginia.

Two big purple states here — Florida and New Hampshire. Networks are likely to wait another hour until the polls close in the panhandle section of Florida before making a projection there based on exit polling.

Races to Watch:

• FL/Senate race for the open seat of Bob Graham (D): Mel Martinez (R) vs. Betty Castor (D)
• GA/Senate race for the open seat of Zell Miller (D): Rep. Johnny Isakson (R) vs. Denise Majette (D)
• GA/03: Rep. Jim Marshall (D)
• GA/12: Rep. Max Burns (R)
• SC/Senate race for the open seat of Ernest Hollings (D): Rep. Jim DeMint (R) vs. State Education Superintendent Inez Tannennbaum (D)

7:30 p.m. — 40 Electoral Votes

Polls close in North Carolina, Ohio and West Virginia

Two purple states here — Ohio and West Virginia

Races to Watch:

• NC/Senate race for the open seat of John Edwards (D): former Clinton Chief of Staff Erskine Bowles (D) faces Rep. Richard Burr (R).
• NC/11: Rep. Charles Taylor

8:00 p.m. — 197 Electoral Votes

Polls close in Alabama, Connecticut, Delaware, District of Columbia, Illinois, Kansas, Maine, Maryland, Michigan, Mississippi, Missouri, New Jersey, Oklahoma, Pennsylvania, Tennessee and Texas.

Three purple states here — Michigan, Missouri and Pennsylvania.

Races to Watch:

• AL/03: Rep. Mike Rogers (R)
• CT/02: Rep. Rob Simmons (R)
• CT/04: Rep. Chris Shays (R)
• IL/Senate race for the open seat of Peter Fitzgerald (R): Barack Obama (D) will be the junior senator from Illinois — net one seat to the Dems.
• IL/08: Rep. Phil Crane (R)
• KS/03: Rep. Dennis Moore (D)
• OK/Senate race for the open seat of Don Nickles (R): Brad Carson (D) vs. former Rep. Tom Coburn (R )
• PA/06: Rep. Jim Gerlach (R)
• PA/08 race for the open seat of Jim Greenwood (R): Virginia Schrader vs. Michael Fitzpatrick (R)
• PA/13 race for the open seat of Joseph Hoeffel (D): Allison Schwartz (D) vs. Melissa Brown (R)
• PA/15 race for the open seat of Pat Toomey (R): Joe Driscoll (D) vs. Charlie Dent (R)
• PA/17: Rep. Tim Holden (D)
• TX/01: Rep. Max Sandlin (D)
• TX/02: Rep. Nick Lampson (D)
• TX/17: Rep. Chet Edwards (D)
• TX/19: Rep. Charlie Stenholm (D) vs. Rep Randy Neugebauer (R)
• TX/32: Rep. Martin Frost (D) vs. Rep Pete Sessions (R)

8:30 p.m. — 6 Electoral Votes

Polls close in Arkansas

9:00 p.m. — 99 Electoral Votes

Polls close in Arizona, Colorado, Louisiana, Minnesota, Nebraska, New Mexico, New York, Rhode Island, South Dakota, Wisconsin and Wyoming.

Four big purple states here — Colorado, Minnesota, New Mexico and Wisconsin.

Races to Watch:

• AZ/01: Rep. Rick Renzi (R)
• CO/Senate race for the open seat of Ben Campbell (R): Ken Salazar (D) vs. Pete Coors (R)
• CO/03 race for open seat of Scott McInnis (R): John Salazar (D) vs. Greg Walcher (R)
• CO/07: Rep. Bob Beauprez (R)
• LA/Senate for the open seat of John Breaux (D): David Vitter (R) vs. a Democratic candidate to be determined in a December runoff
• LA/03 for the open seat of Rep. Billy Tauzin (R): Billy Tauzin III (R) vs. a Democratic candidate to be determined in a December runoff
• LA/05: Rep. Rodney Alexander (R)
• LA/07 for the open seat of Chris John (D): John Boustany (R) vs.a Democratic candidate to be determined in a December runoff
• NE/01 for the open seat of Doug Bereuter (R): Matt Conneally (D) vs. Jeff Fortenberry (R)
• NE/02: Rep. Lee Terry (R)
• NM/01: Rep. Heather Wilson (R)
• NY/01: Rep. Tim Bishop (D)
• NY/27 for the open seat of Jack Quinn (R): Brian Higgins (D) vs. Nancy Naples (R)
• NY/29 for the open seat of Amory Houghton (R): Samara Berend (D) vs. Randy Kuhl (R)
• SD/Senate: Sen. Tom Daschle (D)
• SD/01: Rep. Stephanie Herseth (D)
• WI/Senate: Sen. Russell Feingold (D)

10:00 p.m. — 27 Electoral Votes

Polls close in Idaho, Iowa, Montana, Nevada, North Dakota and Utah.

One purple state — Nevada.

Races to Watch:

• IA/03: Rep. Leonard Boswell (D)
• NV/03: Rep. Jon Porter (R)
• UT/02: Rep. Jim Matheson (D)

11:00 p.m. — 77 Electoral Votes

Polls close in California, Hawaii, Oregon and Washington.

Two purple states — Oregon and Washington.

Races to Watch:

• CA/20 for the open seat of Calvin Dooley (D): Jim Costa (D) vs. Roy Ashburn (R)
• OR/01: Rep. David Wu (D)
• OR/05: Rep. Darlene Hooley (D)
• WA/Senate: Sen. Patty Murray (D)
• WA/05 for the open seat of George Nethercutt (R): Don Barbieri (D) vs. Cathy McMorris (R)
• WA/08 for the open seat of Jennifer Dunn (R): Dave Ross (D) vs. Dave Reichert (R)

12:00 a.m. — 5 Electoral Votes

Polls close in Alaska.

Race to Watch:

• AK Senate: Sen. Lisa Murkowski (R)

Some Relief in Building Materials Prices Is on the Way, Economists Say

Builders can expect modest relief from soaring materials prices in the coming year, with the notable exception of the cost of cement, which is expected to peak in early 2005 as Florida’s post-hurricane reconstruction efforts move into full swing, according to analysts at NAHB’s Construction Forecast Conference in Washington, D.C. last week.

Led by scrap steel costs, which soared 80% since last year, several key building materials have posted double-digit increases over the past 12 months. Steel mill products jumped 43%, lumber prices are up 27%, gypsum 20% and cement 6%.

“This is a normal commodity price cycle and we are currently at the peak,” said John Mothersole, senior member of Global Insight's Industry Practice. “We believe that commodity prices are topping out and moving on a downward slope. However, the bad news is that the ride down won’t be too steep in 2005.”

Commodity prices are determined by international factors, Mothersole noted, and while the U.S. consumes about 13% of the world’s steel products, China is now almost three times larger in terms of production and consumption.

China’s phenomenal growth has caused global demand to exceed capacity, leading to a huge price run-up, he said.

Shipping capacity has also been strained, causing transportation prices to soar. “A year ago, a tanker cost $35,000 a day. Today that cost is $135,000,” he said.

Mothersole forecast that steel prices will start declining in the current quarter and continue to ease through 2005 because of several factors: steel products are profitable, so more plants will be coming online; additional shipping capacity will be added; and, because U.S. steel prices are set above the global rate, there is an incentive to sell more product to the American market.

“We expect more significant price declines in 2006 and 2007 as ore and coke become more plentiful,” he said.

In the case of cement, with lean inventories on hand, the housing industry this year has been caught flat-footed by surging demand. High shipping rates and rail bottlenecks have exacerbated the problem, resulting in spot shortages and an 8% price hike from the second quarter of 2003 to 2004.

Eliminating costly tariffs on Mexican cement imports would help alleviate the shortages, and NAHB has made considerable headway in its discussions with Commerce Secretary Donald Evans and others in the Administration on this issue. However, Mothersole said he does not expect this problem to be resolved soon. Import availability and transportation issues are not expected to be corrected in the next eight months, he added, and as a result of Florida’s massive rebuilding efforts, cement prices won’t reach their peak until next spring, after which there will be modest declines.

The price of gypsum has increased roughly 20% this year, but price gains for this product should fall into the 6% range next year, as sales slow and imports rise.

“Volatile” is the word that best describes lumber and panel prices, according to Al Schuler, research economist for the USDA Forest Service.

“Volatility is the nature of the beast, but we expect prices to moderate next year in response to a pullback in housing and increased supply,” he said.

A persistent problem with oriented strand board (OSB) is that its producers have failed to “read the tea leaves,” Schuler said. In the mid-1990s, the industry overbuilt capacity, resulting in weak pricing and miniscule profits. During the past few years, the industry underestimated demand and cut back production.

“Nobody wants to hold inventory because it costs money, but no inventory in the pipeline breeds volatility,” said Schuler, who noted that the top five structural panel producers account for 75% of the overall market share.

OSB capacity will remain relatively fixed in the short-term because it takes up to two years to build a new OSB mill and at least another 18 months to ramp up to full production. Several new mills in Canada and the U.S. are in the planning stages and as capacity increases in the coming years, OSB prices are expected to decline.

Schuler noted that the U.S./Canada trade dispute on softwood lumber has contributed to price volatility during the past three years. In late August, a NAFTA panel found that the 27% duties on Canadian softwood lumber should be rescinded because domestic lumber producers failed to prove that imports pose a threat to their health.

The U.S. intends to issue legal challenges to the NAFTA ruling, and Schuler is guessing that a negotiated settlement with duties of 15% or less will be reached in 2005.

Settlement of the issue would decrease volatility and ease upward pressure on lumber prices. How much depends on many factors, said Schuler, including demand, alternative supply from domestic and non-Canadian sources and non-wood substitutes.

During the next couple of years, Schuler said he anticipates that OSB prices will decline 30%-35%, and increased South American imports should lead to a 15% decline in plywood and softwood lumber prices.

Photos by Morris Semiatin 

Rebounding Job Markets Spell Good News for Housing

While some of the nation’s job markets continue to be weak, at least 18 states have already surpassed their pre-recession employment peaks and others are in position to catch up fast, and that bodes well for housing demand, according to panelists at NAHB’s Construction Forecast Conference in Washington, D.C. last week.

Economy.com Chief Economist and Co-founder Mark Zandi and Stanley Duobinis, founder of Crystal Ball Economics, Inc., said that employment has bounced back in these states: Nevada, New Mexico, Arizona, Montana, Washington, Idaho, Maryland, Florida, Utah, North Dakota, South Dakota, Wyoming, New Jersey, Wisconsin, Virginia, Rhode Island, Maine and Alaska.

States where they said employment should hit pre-recession peaks next year are: California, Oregon, Nebraska, Texas, West Virginia, South Carolina, Georgia, Minnesota, New Hampshire, Louisiana, Arkansas, Missouri, Kentucky and Tennessee.

But they said there are some states that will have to wait until 2006, 2007 or even later for employment to fully recover: Kansas, Colorado, Iowa, Mississippi, North Carolina, Pennsylvania, New York, Massachusetts, Alabama, Oklahoma, Illinois, Ohio, Indiana and Michigan.

The strongest metro area job and housing markets are to be found where defense-related companies are big business, since government spending in this sector has risen substantially. These cities include: Sacramento, CA; San Diego; San Antonio; Baltimore; Orlando and Jacksonville, FL; Charleston, SC; Oklahoma City; Phoenix and Tucson, AZ; St. Louis; Washington D.C.; Norfolk, VA; and a few others.

Likewise, “gateway economies” with strong in-migration are well-positioned for growth, as are technology-driven metros: Seattle, New York, Washington, Boston, Charleston, Chicago, Dallas, San Antonio, Houston, Tucson, Houston and a handful of California cities including Los Angeles and San Francisco.

On the flip side, hard-hit manufacturing centers of the Midwest and industrial areas in the Northeast continue to lag in the national recovery. At the top of the list is Indiana, where 22% of the jobs are related to the industrial and manufacturing sectors, the highest of any state. Running a close second are Arkansas and Wisconsin, each with 21%

On a broader scale, Zandi sounded a note of caution for local economies that are particularly dependent on the automobile and other interest-rate sensitive industries, including parts of Michigan, Indiana and Ohio.

According to Duobinis, home builders will do well next year in Florida, Georgia, South Carolina, North Carolina, Arizona, Utah, Colorado, Idaho, Minnesota and Delaware — states expected to register between 8.5 and 21 housing starts per 1,000 residents. The outlook is even better for Nevada, where 21 housing starts are expected per 1,000 — primarily in the Las Vegas area. That makes Nevada “the most building-intensive site in the country by a factor of two,” Duobinis said.

Interestingly, Duobinis isn’t waving builders away from the two states that he expects to show the biggest declines in housing starts this year — California and Florida. “Each of these has had such incredibly strong starts activity, it would be nearly impossible to keep up that kind of growth,” he explains. “For example, Florida recorded a 20% increase last year. Not keeping up with that pace doesn’t make it a bad market by any means.”

Photos by Morris Semiatin

New Home Sales on the Rise in September

With mortgage financing costs remaining low and the nation’s economy continuing to improve, sales of new single-family homes rose 3.5% in September to a seasonally adjusted annual rate of 1.206 million units, the U.S. Commerce Department reported last week.

Sales in September were 7% stronger than during the same month a year earlier.

“With long-term mortgage rates below 6% and adjustable rate mortgages around 4%, buyers have had a powerful incentive to buy and we expect robust sales to continue in the coming months,” said NAHB President Bobby Rayburn.

The latest NAHB/Wells Fargo Housing Market Index, which is based on monthly surveys of single-family builders, indicated that there was a large turnout of prospective buyers at model homes and sales centers last month, Rayburn added.

“Economic conditions — low mortgage rates, healthy income and employment growth and solid house price performance — continue to invigorate demand,” said NAHB Chief Economist David Seiders. “We certainly remain on track to have another record year in 2004.”

New home sales increased 12.3% in the Midwest, 6% in the Northeast and 2.7% in the South. They were down a slight 0.8% in the West.

There were 404,000 units in September’s inventory of unsold new homes, representing a 4.1-month supply at the current sales pace, and that was a slight improvement from the preceding month.

‘HousingEconomics Online’ Provides In-Depth Analysis of Housing Market

“HousingEconomics Online” is a new online publication from the NAHB Economics Group that provides the latest housing economic data, trends and key events that shape the economy. NAHB’s leading economists analyze and synthesize the housing and economic information to provide in-depth analyses of the niches and nuances of the home building market.

“HousingEconomics Online” replaces and consolidates NAHB’s three print monthly economic publications: “Home Builders Forecast,” “Housing Market Statistics” and “Housing Economics.” Subscribers now can receive the economic data and information they need from one reliable source.

BuilderBooks.com Has 'Accounting and Financial Management for Residential Construction'

"Accounting and Financial Management for Residential Construction, 4th Edition," available at BuilderBooks.com, helps builders, developers and contractors understand how an accounting system operates and the basic principles for processing financial data. It includes the NAHB Chart of Accounts. To view or purchase this publication online, click here,  or call 800-223-2665 to order.

Searches Easier Than Ever on NAHB’s Official New Homes Web Site

Consumers who are shopping for a new home on HomeBuilder.com™ — a division of Homestore and NAHB’s official Web site on the Internet — will find their search faster, easier and more effective following significant changes that have recently been made to the site’s search function.

Prospective home buyers can now locate new homes by precise geographic locations, re-rank their search results based on their own criteria and map all search results. According to recent surveys, a significant majority of home buyers begin their search online. 

In other changes that were announced by Homestore last week from its headquarters in Westlake Village, CA, builders can now promote their communities more prominently and display advertising within more focused geographic areas.

“We are committed to offering consumers the most comprehensive — and easily searchable — new home content possible,” said Mike Long, the company’s chief executive officer. “By enabling consumers to more easily find the new home communities and new homes that best fit their needs, we are able to generate even more highly qualified buyer inquiries for our home builder customers.”

Ranked as the Internet’s leading new homes site, the HomeBuilder.com database offers prospective home buyers more than 75,000 models, homes and built-to-suit plans for viewing.

HomeBuilder.com is the exclusive new home content provider to AOL, MSN, Yahoo! and United Online.

Sales Office Technology — Keep It Simple and Friendly

By Lino Hilario, Imagenius® Inc.
When it comes to interactive sales centers, the biggest inhibitor is that the technology may actually “get in the way.” For that reason, I believe in the “K.I.S.” rule (Keep It Simple).

Simplicity in operation and navigation is critical to successfully incorporating technology in a sales center. Guests should not be made to feel intimidated by the technology. Rather, technology in the sales office should be inviting enough for guests to want to explore and enjoy the interactive experience.

The key emphasis for success here still remains the selection of a qualified vendor, one who has the expertise and experience to deliver proven results. Don’t put your faith in an unproven vendor.

There are only three or four qualified vendors that I know with the experience and expertise to deliver a successful technology integration solution. Using a qualified vendor is critical to ensuring that your first efforts of incorporating technology in your sales process will not be your last.

With a qualified vendor in place, the selection of high quality components should be at the top of your list of priorities. Secondly, keep the interface navigation simple and intuitive. At the sales center, a guest is not judging the creative ability of a builder or the artistic and programming power of their design team. They are judging the builder, community and homes being sold at that development.

Touch Navigation Helps Remove ‘Tech Phobia’

The experience of a well laid out presentation that clearly communicates the brand and the community and all it has to offer the prospective customer is the most distinguishable memory that guests will take with them from the sales center.

• A touch navigation panel helps to remove any “tech phobia” from the display.
• Narration and audio prompts that guide visitors through the presentation and the offerings are also critical.

Sales Technology Should Invite People to Explore

The minute guests experience complexities or difficulties using a display, they will back away from it rather than attract attention to the fact that they are stuck. When planning, developing and designing a display, make every effort to incorporate technology that provides an “invitation to explore.”

The “invitation to explore” factor is critical. It not only triggers an amazing transformation, it fosters an exchange of communication or “pull marketing” that helps quantify a particular prospect’s interests. While engaged in a well-designed interactive display, the guest, with a touch of a finger, will drill down through the presentation and show the sales staff what interests them most.

For example, if a guest drills down a presentation in the builder credibility section, then based on pull marketing principles, they fit the "analytical" profile. A mid-20s guest drilling down the lifestyle section would have the profile demographic of an "expressive-creative."

In other words, guests will present their profile demographic when exploring the presentation and provide indications of the style required for a successful closing.

It Works in the Timeshare Industry. Why Not Home Building?

As one of the key tools being used to achieve sales targets within the timeshare industry (by one of the industry’s giants), the results have been successful closings for eight out of every 10 sales center guests. And to think that those results occur in an industry where prospects enter the sales gallery with the position that: “We are not here to buy anything today.”

Now imagine the success when applying this strategy/process to a guest who is actively searching for a new home.

In the majority of my experiences assisting marketing teams going digital, the results have been successful when incorporating the above-mentioned technology design and presentation development steps. However, there is no amount of technology that can replace good presentation content.

High quality visuals, video, audio and text are mandatory. Combine these with an “invitation to explore” and purge your sales center of  “tech phobia"  — and you have a foundation for creating successful sales office technology.

Touch Panel or Mouse? Forget the Mouse

To a guest, a mouse still represents a computer somewhere in the background, and that can be intimidating and discourage exploration.

A perfect case study is how gas stations have embraced touch panel ATMs at gas pumps across the nation. Young and old alike have adapted to using them with little or no intimidation.

The average cost of a good quality touch panel is around $1,000 and worth every cent of the investment toward a successful digital interactive deployment in a sales center.

I always close sales discussions by saying, “It’s not the Web site, presentations or pictures that sell the homes — it’s the sales staff.” But giving a skilled sales staff the tools to increase their ability to complete the sales process in a more informative and committed way is the real key to success.

Lino Hilario is the vice president and leading sales strategist for Toronto-based Imagenius® Inc., and has developed presales programs for North America’s leading home builders. For more information on digital real estate solutions, visit www.imagenius.com or call 888-439-4633.

Originally published in NAHB’s "Sales + Marketing Ideas" magazine ©2004.

Use Universal Design to Meet Buyers’ Needs and Set Yourself Apart From the Crowd

To be a leader in the housing industry, it’s important to anticipate your customers' desires and needs before they are aware of them. Incorporating the principles of universal design into your new home designs creates homes that are more responsive to your buyers’ current and future needs and desires.

Man invented the inclined plane, wheel, lever and pulley to make work easier. Unfortunately, the current design of traditional homes doesn’t allow some buyers — especially older ones or people with limited mobility — to take full advantage of these conveniences.

The cutting-edge design trend of universal design (UD) incorporates these "work simplifying" simple machines, plus ergonomic design features, to create efficient, comfortable and convenient "Homes For Easy Living™.”

Just a few examples of universal design include:

• Sloped sidewalks without steps
• No-step entries
• Wider doors and hallways

Universal Design as ‘Preventive Architecture’

Universal design homes also accommodate wheeled devices such as baby strollers, wheeled luggage, dollies for moving furniture, wheeled walking devices and wheelchairs. Lever door handles make it easier to open the door — even when carrying sacks of groceries, a small child or other parcels. Lever faucet handles make it possible to adjust the water temperature easily when hands are slippery with soap. Stacking a walk-in storage closet on top of a walk-in pantry creates a shaft that can be converted into a personal elevator (pulley system) in the future.

The Occupational Safety & Health Administration applies the principles of ergonomics to work environments to reduce the risk of injuries to workers. UD homes incorporate the ergonomics principles to reduce the risk of injuries to residents. In a sense, universal design is a form of "preventive architecture.” Fall prevention is one of the most important elements in today's “aging in place” movement.

Most people prefer to be in the familiar setting of their own home when they don’t feel well. UD homes facilitate recuperation at home. Many long-term-care insurance policies now provide for in-home care, but most traditional homes are not adequately designed to support it. UD homes give people the freedom to choose where to recuperate from illness or injury, not to mention “age in place” with dignity as they get older.

With the medical advances of the past decades, it has become common to see families with four or five generations still alive and well. However, even healthy seniors are finding traditional homes increasingly difficult to navigate.

Universal Design Provides Lifestyle-Enhancing Benefits

UD homes are frequently referred to as "transgenerational" homes because they accommodate people of all ages and abilities. The entire family can gather to celebrate holidays and special family events, thanks to inclusive universal design features.

So why don't all new homes incorporate UD principles? Unfortunately, there are several misconceptions about UD homes. Many builders don’t think that there is a market for universal homes. There is always a desire for more convenience, comfort, safety and accommodation for all family members, but the public is only now becoming aware of the lifestyle-enhancing benefits of universal design, so they haven’t asked for it. Fortunately, the mainstream media and AARP are educating the public about the universal benefits of universal design, increasing the demand for UD throughout the country.

In fact, 88% of the buyers in an award-winning community with universal designed homes in Murrieta, CA, were able-bodied people. They bought the homes simply because they loved the open, spacious floor plans and convenient design. They were pleased to learn about the future benefits of being able to “age in place,” but their initial desire to buy them was due to the enhanced aesthetics and ergonomic benefits they could enjoy from the first day they moved into their new homes.

Universal Design Adds Minimal Costs to New Construction

Many fear that universal design will add too much to the cost of the home. At this time, the added expenses could range from $1,500 to $5,000 per home because the features are new and not well-incorporated into common building practices. As builders begin to incorporate universal design more consistently, the cost could drop because of a higher sales volume of these products and more familiarity with this approach.

Adding fundamental UD structural features will increase the base cost of the house minimally. However, these additional costs for special UD options normally can be charged directly to the buyers, increasing the developer's profit.

Many developers think UD features are unattractive. In reality, well-done UD actually enhances aesthetics by creating brighter, open and user-friendly floor plans.

Universal homes truly have universal benefits. Incorporating universal design during the initial phases of new home design will lead to optimal results. However, incorporating universal design into the design of a major remodeling project can be effective, too. Expand your share of the market by being the leader in offering the most value-added product.

Susan Mack, OTR/L, CAPS, is president of Murrieta, CA-based Homes For Easy Living Universal Design Consultants. An expert on universal design and winner of several aging-in-place design awards, she has spoken at regional and national conferences, including Building for Boomers & Beyond: Seniors Housing Symposium. For more information, e-mail Mack, call her at 760-409-7565 or visit her Web site, www.homesforeasyliving.com.

National 'Aging in Place Week' Events Slated in 20 Cities

National Aging In Place Week is Nov. 7-13, with events planned in more than 20 cities across the country.

The week of events is sponsored by the National Reverse Mortgage Lender’s Association (NRMLA) and the Aging In Place Council — which includes the NAHB Remodelors™ Council, NAHB Seniors Housing Council and NAHB Research Center.

For information, e-mail Darryl Hicks, Aging In Place Council, or call him at 202-939-1784.

Cast Your Vote for ‘Aging In Place’ — the Future of Seniors Housing Is at Stake

With the elections upon us, it’s time to vote for the future of seniors housing. As an unabashed supporter of “Aging In Place” (no undecided-ness here!) my task is to persuade you to realize all the strengths my candidate has to offer. But how?

First of all, I have to convince you that you have an important choice to make about seniors housing. I must persuade you to exercise your power to choose — now — on the eve of elections while there is still time to make a difference. And finally, I must sway you to “elect” my candidate.

Let me start by talking a little about each candidate’s platform.

On One Side of the Aisle: Standard Seniors Housing

Standard seniors housing stands for people willing to accept the status quo without careful examination. Perhaps they aren’t aware of viable alternatives, or maybe they fear that talking about viable alternatives and options might open the door to personal involvement.

What options are pushing standard seniors housing to change? The market today includes many — active adult housing, assisted living, independent living, group homes, continuing care retirement communities (CCRCs), nursing homes and various combinations.

What do all these options have in common? All require you to move out of your home. Most include services or assistance with the living quarters. The key distinguishing features among them are the amount and level of assistance provided.

Finally, moves to active adult housing and CCRCs are planned, whereas moves to the other facilities are usually forced by circumstances. The "Guide to Retirement Living" provides interested readers good descriptions of each option.

On the Other Side of the Aisle: Aging In Place

Like many “new” candidates, this choice is heavily polled. In 2000, AARP issued “Fixing to Stay: A National Survey on Housing and Home Modification Issues.”

Eighty-nine percent want to remain in their homes!

The AARP survey found that 89% of “respondents ages 55 and over … strongly or somewhat agree that they would like to remain in their current residence for as long as possible.” Aging in place is what most people want.

Aging In Place is more economical and efficient!

Aging In Place is more economical and efficient than standard seniors housing because it uses existing housing and relies upon informal resources. Aging In Place allows the people (the voting/buying public) to retain greater control over their lives.

On the downside, I must concede that Aging In Place is not as well-funded or as easy to organize as standard seniors housing. What’s more, Aging In Place requires advance planning to work.

Aging In Place stands for independence and safety!

In stumping for Aging In Place, however, I must speak about preparing for aging in place — about no-step entries and bathroom designs that enhance independence and safety. Healthy, active people nod in understanding when I describe wellness and fall prevention programs. They agree intuitively that it makes sense to maintain control by planning.

But do they vote? Do they spend time and money now so they can keep control later, even when accidents or illnesses conspire to force “the move?” How many of you have taken these steps? You know the answer.

The bottom line is how can I draw attention to the differences? What will get people to the “polls?" What will overcome the inertia of “wait and see” and show people the wisdom of planning?

Aging In Place — because bad things can happen!

Some discussion in every election cycle focuses on the benefits and repercussions of “going negative.” Everyone wants candidates to take the high road, but differentiating themselves is difficult. Going negative turns some voters off, but if the message warrants the risk this tactic may be worth it.

At the risk of turning some voters off, I am going to go “negative” using an arsenal of statistics from the Centers for Disease Control and Prevention:

• More than one-third of all adults ages 65 and older fall each year.
• Falls are the leading cause of injury deaths among older adults and the most common cause of nonfatal injuries.
• Fall-related injuries result in hospitalization five times more often than any other type of injury.
• Of all fall-related fractures, hip fractures lead to the most severe health problems and reduced quality of life and cause the most deaths.
• Up to 25% of community-dwelling older adults who sustain hip fractures remain institutionalized for at least a year.
• In 2001, more than 11,600 people ages 65 and older died from fall-related injuries.

Most think accidents and illness will never happen and are content to do nothing. “I’ll wait until I need it,” they say. But that strategy — denial — will not work.

Getting into shape is something you must do before an accident or illness. Planning and completing home renovations while you or a loved one is hospitalized is nearly impossible to do. Designing the project, getting an estimate, obtaining permits and scheduling the job require more time than the typical hospital stay.

Planning ahead is the only way to assure your future. Vote for “the future you want” by planning for your aging in place today.

Vote for Aging In Place!

I'm Louis Tenenbaum, and I approve this column.
(In my debate, there will be no 90-second rebuttal.)