Black & Decker Rolls Out 'SiteLock’ System to Foil Job Site Tool Thefts
Black & Decker is venturing outside its traditional power tools and accessories business with a new portable “SiteLock” security system that employs licensed wireless and cellular data-transmission technologies packaged under the company’s professional-grade DeWalt brand. The system can monitor different areas of the job site, safeguarding items as big as backhoes and bulldozers, and as small as individual power tools, according to Bill Pugh, group marketing manager for the DeWalt Security Business Group. The basic unit and one keychain remote will list for $1,000, and individual sensors will be priced from $99-$199. In residential construction alone, theft of materials and appliances and damages caused by those crimes range from $1 billion to $2 billion annually, according to NAHB, enough to push up the price of new homes by 1%-2%. Thefts of heavy equipment cost the construction industry $300 million to $1 billion a year, only 10% of which is ever recovered, according to the National Equipment Register. (www.baltimoresun.com)
Baltimore Sun (1/25/05); William Patalon III
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Tackling the ‘Housing Crisis’
In his recent State of the State address, California Governor Arnold Schwarzenegger has pledged to “seek to reform onerous regulatory and planning laws to promote home building” in his proposed budget. Interviews with insiders in Sacramento, the state capital, suggest the administration intends to propose changes to the 1970 California Environmental Quality Act, with the goal of reducing the costs, time and opposition builders face when trying to get housing projects approved, especially within urban areas. Another concept under consideration would be a state mandate for local governments to plan for housing 20 years in advance, compared with the current five- to seven-year planning horizon. At about 60%, California’s homeownership rate is lower than all but two states — New York and Hawaii. California’s median home price has more than doubled over the past five years — rising from $191,500 to $398,000. “From an economic standpoint, something’s gotten out of whack over time,” says Tim Coyle, a lobbyist for the California Building Industry Association. “To begin to close the gap (between supply and demand) will also take time, but the price of not doing that is to continue to price working folks out of the market.” (www.sacbee.com)
Sacramento Bee (1/21/2005); Andrew LePage
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Cost of Land Continues to Skyrocket in Greater St. Paul, Minn., Area
Builders and developers in the Minneapolis-St. Paul area are complaining that their Metropolitan Council is limiting the land supply, which is pushing up land prices and consequently housing prices. Defending its controversial controlled growth policies, the council says that they are needed to keep public services from being overwhelmed. While no agency tracks land deals, developer Rick Packer says he was involved in the purchase of land at $70,000 an acre three years ago. The same land today would go for $140,000 an acre, said Packer, who is chairman of the Twin Cities Builders Association Public Policy Committee. Builders typically put two, sometimes three homes on an acre. Land costs double by the time the lots are developed, and they typically account for one quarter of the final home price. NAHB economist Gopal Ahluwalia says that he is not surprised by anecdotes about rising land prices, which are almost inevitable for growing urban areas. Ahluwalia thinks that lack of land in urban areas is shaping up as the biggest problem facing home builders. “Unfortunately, land is one thing that can’t be manufactured,” he said. “Whatever you have, you have.” In the meantime, by designating the land that is available for residential development, the Metro Council is making the situation far worse, builders report. (www.twincities.com)
St. Paul Pioneer Press (1/16/05); Gita Sitaramiah
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Forty-Year Mortgages Panned
Fannie Mae’s pilot program for 40-year mortgages took a drubbing from CBS Market Watch, which called it the “Stupid Investment of the Week.” Designed to reduce monthly payments and help income-poor buyers get into a home by expanding the amortization period, the loan’s critics say it costs .25 to .35 percentage points more than a 30-year loan and over the life of the loan the greater amount of interest that is paid virtually erases the benefit of the monthly savings. Payments on a 40-year mortgage for a conforming loan limit of $359,650 are roughly $100 less than for a comparable 30-year loan. A hybrid or two-step ARM with a fixed rate for five years and an adjustment once a year for the next 25 years, starting at Freddie Mac’s reported rate of 5.05%, reduces monthly payments more than the 40-year loan and costs $339,357 in interest over the life of the loan, compared to a whopping $604.677 for the pilot product. (www.realtytimes.com)
Realty Times (1/18/05); Broderick Perkins
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Scientists Test Building Materials With Simulated Earthquakes
Working to help engineers devise stronger power lines, telecommunications cables and water and fuel pipes, researchers at four locations around the country — Cornell University, in Ithaca, N.Y.; the University of Illinois at Urbana-Champaign; Oregon State University and the University of California at San Diego — are using powerful hydraulic presses and tall walls of concrete to produce shearing forces exceeding the strongest recorded earthquake. Cornell is among 15 universities participating in the National Science Foundation’s Network for Earthquake Engineering Simulation. The laboratories are linked through the Internet, allowing researchers to share data as they conduct their experiments. (www.post-standard.com)
Ithaca, N.Y., Post-Standard/AP (11/15/04); Dennis Nett
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Petrie Urges Attention to Economic Urban Revitalization
The development of brownfields, the availability of terrorism insurance and continued funding of major HUD programs are key to the revitalization of urban areas, Michael Petrie, chairman of the Mortgage Bankers Association, told the U.S. Conference of Mayors at its recent winter meeting in Washington, D.C. To help ensure that the real estate finance industry continues to play a “vibrant role” in the nation’s future economic security, he said that converting old and vacant properties into productive job-producing properties should be a priority for the 109th Congress. On the issue of terrorism insurance, he said that potential acts of terrorism make it imperative for Congress to support extension of the “Terrorism Risk Insurance Act of 2002," which creates a federal backstop for terrorism insurance coverage but is set to expire in December. (www.mortgagebankers.org)
MBA Commercial/Multifamily Newslink (1/20/05); Mike Sorohan
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Over-55 Housing a Growing Trend
Communities in Western Massachusetts for World War II baby boomers reaching their mid-50s are gaining in popularity. The housing tends to be ranch-style, with all of the accommodations on one floor, according to Laura Stevens, owner of the Longmeadow office of Keller Williams Realty, which covers all of the western part of the state. Even in cases where there are townhouse styles, she said, the master bedroom is usually on the first floor. A one-car garage is common, as older singles and couples tend to use one vehicle. She noted that the pluses in these developments include peace and quiet and a sense of community. But those may be minuses for some people who are opting out of homogenous housing that offers little social variety and an absence of youths. (www.repub.com)
Springfield, Mass., Republican (10/19/04); Chris Hamel
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Residences at Mall Yield Urban Flavor, Convenience Suburbs
More and more condominiums and townhouses are sprouting next to shopping malls that were once reachable only by motor vehicle, enabling suburban home owners to enjoy the convenience of shops, restaurants and nightlife normally associated with an urban setting. “It’s great because I can walk to the movie really quick,” says Tia Arnold, whose front door is just across the parking lot to The Mall in Columbia, Md. The most ambitious mall housing planned for the area is the $400 million transformation of Parole Plaza outside Annapolis into a “lifestyle center,” with high-rise condos built atop shops, offices and restaurants in a compact town. Critics of sprawling suburban development see hope in the mall-housing trend, though they say it is no substitute for city living. (www.baltimoresun.com)
Baltimore Sun (11/29/04); Timothy Wheeler
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Density Trend at Critical Mass
A scarcity of land and high demand for housing are producing a high- and medium-density housing trend in the San Francisco Bay area. In Berkeley, over the past five years 1,000 higher-density units have been constructed, are under construction or have been approved, said Dan Marks, the city’s director of planning and development. Similar projects are underway in El Cerrito and Albany. Since January, Richard Sintchak and his family have been living happily in a $700,000, three-level, three-bedroom, 2,800-square-foot condominium. “What we could get with the same money is a 50-year-old house with less square footage,” said Sintchak, a 41-year-old branch manager with Chase Manhattan Mortgage. “I think the smart-growth, higher-density housing, mixed-use type projects occurring in the Bay Area are at the forefront of what we can expect to see in the next 20 years,” said Alex Amoroso, principal planner for the Association of Bay Area Governments, a cooperative planning agency. “There’s a million-and-a-half people coming to the region; another million-and-a-half jobs are being created. Without sufficient housing, we can’t accommodate all the people being born here.” (www.contracostatimes.com)
Contra Costa Times (12/17/04); Alan Lopez
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West Coast Dominates U.S. Apartment Markets
Four of the nation’s top-five apartment markets this year will be in Southern California, according to Marcus & Millichap Real Estate Investment Brokerage Company’s 2005 National Apartment Index of 42 markets across the country. Riverside-San Bernardino, Calif., topped the list, followed by San Diego; Orange County; Calif.; Las Vegas and Los Angeles. Washington, D.C.; Boston; Fort Lauderdale, Fla.; New York City and Oakland took the sixth through tenth spots respectively. Renting activity is particularly strong in California, the report’s researchers said, because many people in the state’s markets find that buying a home is beyond their financial reach. (www.wsj.com)
Wall Street Journal (01/18/05); Ray A. Smith
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