|
Regulations, Affordability Key Concerns for Production Builders
Government regulations, finding and training good help, anti-growth sentiment, housing affordability and inclusionary/exclusionary zoning are among the most challenging issues facing the industry, according to recent samplings of concerns taken of the members of NAHB’s Single Family Production Committee.
|
Production Builders'
Top 10 Concerns
Government Regulations
Finding/Training Good Help
Anti-Growth Sentiment
General Liability Insurance
Volatile Materials Costs
Land Development Issues
Staying Current
Workforce Housing
Entitlement Difficulties
Customer Financing Issues | While many of the issues have been key concerns to production builders for several years, workforce housing and housing affordability, as well as inclusionary/exclusionary zoning made it into the top 10 only recently.
“The underlying theme of our association has always been to provide a decent house and homeownership opportunities for every family,” said Greg Schwinn of Schwinn Construction in Lincoln, Neb. and the chairman of the NAHB Single-Family Production Committee.
“We want to make sure that as many people as possible have access to homeownership and are part of the ‘ownership society,’” Schwinn continued. “Those in the 80%-120% AMI (area median income) range are probably the hardest to serve in terms of homeownership opportunities, and that is a concern to us and the industry.”
Schwinn also noted that the cost and time involved in addressing government regulations at all levels have driven up the cost of housing. “There are so many regulations that you have to deal with — codes, the EPA, clean air, clean water, endangered species, wetlands permitting. There are so many things you need to look at, which of course adds to the cost of a house.”
An informal poll of committee members was taken in July 2005 and again in January 2006.
The top 10 concerns are listed below, along with corresponding resources available to NAHB members only on the members side of the NAHB Web site:
The Problem: Regulations at all levels of government that add needless time and costs to housing.
NAHB and its affiliated state and local associations work to ensure that housing remains a top national priority when policies are proposed, legislation is debated and regulations are discussed.
Resources for NAHB members:
- To learn more about how NAHB works with Congress, click here.
- Many codes and regulations are implemented on the local or state level. To find your local builders association, click here.
- For information on managing your environmental responsibilities, click here.
- For your state’s storm water permitting requirements, click here.
- For information about the Endangered Species Act (ESA), click here.
- For information about the Environmental Protection Agency’s (EPA) wetlands protection policies and practices, click here.
- For information about the National Pollutant Discharge Elimination System (NPDES), click here.
- For information about the Occupational Safety and Health Administration (OSHA), click here.
- Finding and Training Good Help
The Problem: A limited supply of craftspeople, trade contractors and laborers — brought about by the housing boom — is not expected to ease anytime soon, experts say. In addition, fewer young people are opting for careers in construction compared with years past.
Resources for NAHB members:
The Problem: Growth in many communities has been stalled by a “not-in-my-backyard” attitude from local residents. When anti-development sentiment seeps into city hall, it can halt long-range infrastructure planning, reduce affordable housing options and discourage local business and economic well-being.
Resources for NAHB members:
- General Liability Insurance and the Need for Tort Reform
The Problem: Consistently ranked as one of the top four concerns by members of state and local builders associations, escalating general liability insurance premiums and reduced coverage — or even the inability to obtain coverage — are hurting both builders and remodelers.
Multifamily property owners also are experiencing difficulties maintaining hazard insurance, rent loss coverage and workers’ compensation at levels commensurate with prior years.
Resources for NAHB members:
- Volatile Material Costs and Shortages
The Problem: Factors such as rising housing demand, emerging international economies and trade policy disputes with Canada and Mexico have caused the cost of construction materials to skyrocket. Many suppliers are currently operating at maximum capacity, leaving little certainty to the future of materials availability or home builder profits.
Resources for NAHB members:
- NAHB’s Building Materials Subcommittee monitors and reports on issues affecting the price and availability of critical building materials. Read their reports and findings online.
- NAHB’s economists regularly publish updates on construction material trends and prices online at www.housingeconomics.com.
- An escalation clause is one way to protect yourself in the event of materials price hikes. NAHB members can download one free.
The Problem: Land development is the backbone of the home building industry. However, this crucial function can threaten profits and housing affordability if too many roadblocks pop up.
Bureaucratic timetables for getting entitlement, interest groups that interject provisions into plans that are not market-driven, impact fees, other means of transferring infrastructure costs to builders and developers, anti-development sentiment and environmental regulation all add up to increased costs — and the increased cost of homeownership.
Resources for NAHB members:
- NAHB devotes a section of NAHB Web site to land development issues. Visit the section by clicking here.
- Land Development magazine, published quarterly by the NAHB Land Development Committee, provides useful, practical information on the complex issues developers face. For more information, click here.
- “The Builder’s Guide to the APA: Growing Smart Legislative Guidebook” can serve as a catalyst for changes to state and local planning policies. Find it online by clicking here.
- “The Impact Fees Handbook,” available online as a PDF document, is a guide for any member of the industry who needs to understand and respond to local impact fee initiatives. It covers basic facts and guides the reader to additional sources of information on impact fees. For more information, click here.
- NAHB’s policy on impact fees is to seek and support legislation to provide mechanisms for facilitating broad-based infrastructure finance; support the use of community-wide resources such as property taxes, sales taxes, transfer taxes and income taxes to support infrastructure finance; and encourage government accountability of current and available funding sources before assessing any fee. For more information, go online to click here.
- Staying Current on the Latest Product and Systems Innovations
The Problem: Suppliers are constantly developing new software systems and home tech products. To succeed in today’s competitive climate, it helps to stay current on new technologies that can help builders work more efficiently and profitably — and exceed their customers’ expectations.
Resources for NAHB members:
- NAHB’s International Builders’ Show (IBS) is the one of the largest trade shows in the world. Learn about it at www.BuildersShow.com.
- NAHB hosts meetings, trade shows and workshops throughout the year. For more information, click here.
- The NAHB Research Center maintains case histories on a range of projects — from individual homes to entire subdivisions — that are pushing the state-of-the-art in design and construction innovation. Go online to learn more.
- For help with your information technology infrastructure, visit NAHB’s Technology Solutions Directory at Technology Solutions Directory.
- Keep up with your professional reading. NAHB publishes a wide variety of different publications — e-newsletters, magazines and more. To browse them, click here.
- Inclusionary Zoning and Workforce/Affordable Housing
The Problem: Inclusionary zoning policies are a major roadblock to affordable housing for working families. Creating more affordable housing for working families requires political leadership, innovation and commitment to a broad array of strategies, not the Band-Aid of inclusionary zoning policies.
Resources for NAHB members:
- Read NAHB’s white paper, “The Builder’s Perspective on Inclusionary Zoning,” part of the “Smart Growth, Smart Choices” series of papers. The paper details the negative impact inclusionary zoning policies have had on creating affordable housing from coast to coast. It also explains how Baltimore, has managed to create thousands of affordable housing units in just three years, without price controls. The paper is available online.
- “Where is Workforce Housing Located? A Study of the Geography of Housing Affordability” investigates housing affordability for four occupations — teachers, police officers, nurses and retail sales persons — in the 25 largest metro areas in the country using data from the 2000 Census. The appendices show affordability maps and summary statistics in each metro area for each of the four occupations. The study is available online.
- NAHB’s Legal Ordinance Review Program will examine and analyze ordinances based on constitutional, statutory and case law considerations. Generally, ordinances are reviewed for statutory compliance; procedural and substantive due process considerations; 5th Amendment takings; and other associated legal deficiencies. For more information, go online.
- Read a summary of “Regulation and the Rise of Housing Prices in Greater Boston” as discussed during a press conference at the 2006 International Builders’ Show by clicking here.
- Entitlement Process Difficulties
The Problem: The land development industry faces increasing regulations and obstacles across different levels of government. The result is a lengthened approval process often accompanied by land shortages. Expert analysis helps housing industry professionals understand the myriad and complex issues affecting land development.
Resources for NAHB members:
- Customer Financing Issues
The Problem: NAHB continually advocates affordable housing so that all American families can achieve the dream of homeownership. However, investors apparently taken advantage of “exotic” forms of adjustable-rate mortgages — including negative-amortization and interest-only loans — to the detriment of real homeownership in certain markets.
Resources for NAHB members:
- For information on NAHB’s efforts to keep housing affordable, click here.
- For more information about investor buying and what builders are doing to combat it, click here.
NAHB offers its members many more resources than those offered here. Visit www.nahb.org and log on to take full advantage of the resources available to NAHB members.
NAHB provides myriad legal resources both for members and state and local association staff. While the NAHB staff counsel cannot replace your local attorney, NAHB does offer legal research, litigation funding and litigation strategies depending on the situation and the issues involved. To learn more, visit NAHB’s Legal Services section at Legal Services section.
For more information about production builders, those who build more than 25 single family homes a year, visit www.nahb.org/PB.
 NAHB Has More Than 250 Resources to Help You Run Your Business More Profitably
Go to NAHB's Business Management Tools Web pages (available to members only) for instant access to more than 250 timesaving, moneymaking and cost-cutting business resources to help you run your business more profitably. Get guidance on accounting and financial management, business strategy, computers and information technology, customer service, human resources and more.
Resources are added weekly, so bookmark www.nahb.org/biztools to go directly to these vital business management resources.
Local and state home builders associations can link directly to www.nahb.org/biztools from their Web site and give their members instant access to these resources. It will make your HBA's Web site the place to go for the information and guidance that members need to succeed.
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, visit www.nahb.org/BoB on the Members Only side of the NAHB Web site.
 NAHB Technology Solutions Directory Now Online
NAHB’s Technology Solutions Directory — an easy-to-use directory that enables builders, remodelers, contractors and other industry professionals to find information on software and IT solutions and services for their businesses — is now online. The directory is sponsored by the Business Management & Information Technology Committee.
Software and technology solutions providers interested in being listed can sign up for:
- Enhanced Listing — Listing includes company name, URL, e-mail address, mailing address, phone number, company/product description, company logo. Click here for more information.
- Standard Listing — Listing includes company name and phone number. Click here for more information.
For more information, e-mail Wil Heslop at NAHB.
The Technology Solutions Directory is solely for educational and informational purposes. Nothing in the directory should be construed as policy, an endorsement, warranty or guaranty by the National Association of Home Builders of the listed software, IT service or the software/IT vendor. The National Association of Home Builders expressly disclaims any responsibility for any damages arising from the use, application or reliance on any information contained in this directory.
|
