Print-All Page: May 22, 2006

More than 1,350 builders from across the country arrived in the nation’s capital on May 10 to participate in NAHB’s annual Legislative Conference and to urge their members of Congress to maintain a national priority for housing and to increase housing opportunities for all Americans.

“A record number of builders trekked to Washington to call on their Capitol Hill lawmakers to enact policies that meet our nation’s ongoing housing needs,” said NAHB President David Pressly. “Be it tax policy, excessive regulations that harm housing affordability, property rights or other important issues that affect a builder’s business, the meetings provided a special opportunity for industry professionals to speak directly to their federal representatives and communicate the challenges that their businesses face every day.”

In more than 300 individual meetings with their representatives and senators, builders called for action on the following NAHB legislative priorities:

Builders attending the Legislative Conference said they made a real difference in advancing NAHB’s housing goals by meeting with their lawmakers and legislative staffs.

Home builder Diana Symbol, owner of Professional Services Unlimited in Wasilla, Alaska, said that she and about 30 other builders who met with their entire state congressional delegation — Sens. Ted Stevens (R), Lisa Murkowski (R) and Rep. Don Young (R-At Large) — reported progress in a number of areas.

“Our meetings were very successful. We received a personal commitment from our lawmakers to work with us on storm water and tax issues,” said Symbol. “In addition our senators said they would help to pass S. 1955, small business health insurance legislation that is now pending in the Senate.”

Bob Ross, owner of G&R Construction Services, a residential remodeling, single-family custom home and commercial building firm in Austin, Texas, reported that a group of eight to 20 builders talked with both senators and four representatives from the Lone Star State and that the lawmakers were “generally supportive” of the issues raised by builders.

“It’s important as builders, and as members of NAHB, that we visit with our lawmakers and share the concerns of our industry,” said Ross. “This was a productive day for the cause of housing.”

Sen. Max Baucus (D-Mont.), who addressed the NAHB Executive Committee the day before the Legislative Conference, told builders that the best way to advance their cause was to follow up their scheduled Hill visits with a phone call or letter or by seeking an appointment with their federal representative in their home district.

“Our members who walked the halls of Congress on May 10 sent an important message to their federal lawmakers — namely, to support policies that will increase the supply of affordable housing and expand homeownership and rental housing opportunities for America’s working families,” said Pressly.

To read legislation, click here and enter the bill number in the box at the center of the page.

For more information about the conference, e-mail Michael Strauss at NAHB, or call him at 800-3685242 x8252.

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The Race Is On for National Membership Day

National Membership Day — the federation-wide membership drive — is set for Tuesday, May 23. This year the theme is, "Driven to Be the Best," and NAHB members and state and local associations are preparing for this win/win event.

Having the drive helps local associations revitalize and grow their memberships. It can also help them to energize their members, create excitement, build momentum and even enter into a few friendly cross-state, cross-country or member-to-member rivalries.

Builders Face Higher Copper Costs, Drywall Shortages

With its price almost doubling since the start of the year, copper is the latest commodity causing headaches among builders who have seen record levels of construction activity, an abnormally destructive hurricane season and a changing global marketplace force up the costs of building materials faster than overall inflation, according to NAHB economist Michael Carliner.

There are about 440 pounds of copper in a new 2,100-square-foot, single-family home, according to the Copper Development Association — 200 pounds in wire and another 175 pounds in pipes and plumbing fixtures. Based on that estimate, Carliner calculated that increases in copper prices have boosted the price of a modest-sized home by more than $1,000 in the last three years, or $500 in just the last six months.

Although an “explosion” in copper prices earlier this month, driven largely by speculation, is already showing signs of being partially reversed, Carliner noted that the rising price of copper has only lately been making its way into manufactured items used by builders, and further price increases are likely.

“Copper prices are likely to remain high and prices for many copper-using materials and products will become more expensive,” he said. “Air conditioning equipment, for example, uses a lot of copper, but the prices haven’t adjusted.”

As a benchmark, Carliner cited Bureau of Labor Statistics indices showing that the producer prices of materials used in single-family construction were up 6.9% for the 12-month period ending in April, and that prices were up 7.8% for multifamily building. However, “with tight supplies and increases in transportation costs, further price increases were also imposed in the distribution chain, so that the cost to builders has often increased by a greater percentage.”

While the simmering down process now underway in the housing market would suggest that relief on overall materials prices and supply is on the way, a resurgence in nonresidential construction will offset some of that slack, Carliner said, and the best hope for improvement could come from increased manufacturing capacity. Unfortunately, most of that capacity won’t arrive this year. Moreover, for some products, particularly metals and cement, price increases have been driven by global market conditions, rather than demand from U.S. home builders, so a slowdown in home building will do little to reduce prices.

“Where limited production capacity has created tight markets for wood panels, drywall, insulation, cement and brick, there are new facilities expected, but most won’t open until 2007 or 2008,” he said.

In the latest of ongoing NAHB monthly surveys of builders this May, 34% reported shortages of drywall, 5% of them severe, which is the highest percentage of reported shortages in five years, Carliner said.

Demand for wallboard remains strong across most of the country, and the product is widely used in new home building, with about 10,000 square feet in an average home, he said. Continuing repair of hurricane-damaged homes in the Gulf Coast will add to demand, but the supply is expected to return to healthier levels in 2007 and 2008 when new plants begin operating.

Builders who have been struggling with the short supply of cement in many parts of the country have most recently been outnumbered by those complaining about price increases, even though higher prices are not as difficult a problem. This month’s NAHB survey “found fewer builders reporting concrete and cement shortages than in similar surveys during the past two years, but that could change as seasonal construction picks up.”

Although the producer price index shows national average prices of cement up by 14.9% for the twelve months ending in March, with the overall average for concrete products up about 10.5%, “builders have reported much larger increases for specific products and specific areas, but the problem of availability is still generally more severe than increased cost,” Carliner said. “Delayed supplies of poured concrete have halted construction projects, and there have been long waits for concrete products such as roof tiles.”

Since the cement shortage problem materialized in the spring of 2004, especially in places such as Florida that depend heavily on imports, surveys of cement producers by the Portland Cement Association have found shortages in the Southeast, as well as in the West, from Texas through the mountain states to the Pacific Northwest.

Regulatory barriers, primarily at the state and local levels, have been making it tough for the cement manufacturers to increase their capacity, although they have promised an additional 16 million metric tons by 2010. Only a small part of this new output will arrive before 2008, Carliner said, and in the meantime long-term rebuilding from Hurricane Katrina will mean that shortages are likely to continue for several more years.

For more informatiion, e-mail Michael Carliner at NAHB, or call him at 800-368-5242 x8376.

Housing Cool-Down Is ‘Orderly,’ Fed Chief Says

Pointing to the strength of the overall economy, Federal Reserve Chairman Ben Bernanke said that the current slowdown in the housing market is “moderate” and “orderly.” “We’re seeing slowing in sales, slowing in starts,” he said following a speech in Chicago, according to Bloomberg News. “There also seem to be signs that prices are not rising as quickly as they have been for the past few years.” The chairman’s comments came as Freddie Mac announced that the average rate on a 30-year fixed-rate mortgage hit 6.6% in its latest weekly survey, the highest in almost four years. Citing “no evidence that prices are going to collapse,” Bernanke’s predecessor, Alan Greenspan, predicted that the U.S. housing market is likely to follow the path set in Australia and Great Britain, where booms were followed by a flattening out of prices. However, Greenspan noted that the impact of the cooling-off period for housing on the general economy is not yet clear. To the extent that rising home prices and inexpensive home equity loans have been fueling consumer spending, he said, “there is going to be some slowing of consumption.” (www.washingtonpost.com)
Washington Post (5/19/06); Tomoeh Murakami Tse

Why Perth Is Booming

The prospect of persistently high energy prices has created a new wave of boomtowns such as Calgary, Canada; Nagoya, Japan; Perth, Australia; Casper, Wyo.; and Midland, Texas, according to Joel Kotkin, an Irvine senior fellow at the New America Foundation. Located near the vast oil sands of Alberta, and with low taxes and a business-friendly environment, Calgary is arguably North America’s fastest growing city, he said. The office vacancy rate in downtown Calgary is just 1.7%, and more than 1 million square feet are planned for downtown and another 1 million for the city’s suburbs. Oil prices, Kotkin says, have set off changes in such energy-saving areas as Wyoming, which experienced some of the nation’s slowest income growth in the 1990s but is now getting rich faster than any other state. Casper and Gillette are filling up with workers from the rest of the country, as well as immigrants, and one recent survey finds that Wyoming since 2000 has enjoyed the fastest growth in personal income in the country. Such unlikely places as Montana, North Dakota, New Mexico and coal-rich West Virginia are not too far behind. But it looks like Texas will come out the biggest long-term winner in the energy sweepstakes, and Houston may be the big city with the most to gain from continued high energy prices. With local energy firms returning to the oil fields, the city’s job growth this year may exceed 3%, roughly twice the national average, according to Houston Federal Reserve economist Bill Gilmer. (www.latimes.com)
Los Angeles Times (5/14/06); Joel Kotkin

When Mom (or Dad) Moves In

Anecdotal evidence suggests that there could soon be a surging wave of baby boomers who are modifying their homes to add senior-suitable space for their parents. The 2000 Census found that 4% of U.S. households, or 3.9 million, had three or more generations living together, and one-third of those featured parents who had invited grandparents to move in. Vince Butler, chairman of the NAHB Remodelors™ Council, says that the three-day CAPS (Certified Aging-in-Place Specialist) program to enable contractors to make homes friendly for grandparents “is the fastest-growing course we offer.” Originally, he said, “the goal was to explain that there’d be demand for this in the market. That’s not necessary now.” Butler says his clients have embraced everything from wider doorways and halls, which allows for wheelchair access, to oversized stacked closets that can be easily converted into an elevator shaft. “They like to say, ‘Oh, it’s for my parents,’ but you can tell they’re excited about having these additions for the day that they find it harder to get around.” (www.usatoday.com)
USA Today (5/15/06); Marco R. della Cava

‘Skinny Streets’ Movement Winning Wider Acceptance

Madison, Wis. estimates that it will save 15% on road construction and maintenance in the denser subdivisions where it has just extended its eight-year-old skinny streets ordinance that allows 28-foot-wide thoroughfares instead of the standard 32-foot width in neighborhoods of five or more units per acre. The city will also benefit by deriving more green space, reduced storm water runoff, slower traffic and fewer accidents. Madison Mayor Dave Cieslewicz said that the skinny streets were not an easy sell to the fire department, public works officials and traffic engineers who feared that emergency trucks, snowplows and other vehicles would have difficulty negotiating the narrower widths, and to appease these critics, the program will be reviewed after a few years. If there are problems, on-street parking may be eliminated in some areas. Spokesmen for NAHB and the Urban Land Institute said that opposition to narrow streets is yielding to the influence of New Urbanism and the smart growth movement, both of which stress compact development. Jim Charlier, a Boulder, Colo. transportation consultant, notes that people are beginning to figure out that the money they spend on excessively wide streets can be put to better uses, such as drainage swales and other natural forms of storm water management, more trees and more thoughtful public spaces, all of which make for enduringly beautiful neighborhoods. (www.onwisconsin.com)
Milwaukee Journal Sentinel (5/14/06); Whitney Gould

The ‘Mini-Me’ Structure Is the Latest Addition to the High-End Lifestyle

While the stately pool house is fast evolving from an estate luxury to just another must-have amenity for high-end home owners, only a small percentage of homes will actually have one, according to Gopal Ahluwalia, director of research at NAHB. “You are looking at 1% of homes in the country with a pool house,” he said. “The data shows that consumers want more of everything in the house. They want more amenities, and when people are wealthy, it doesn’t matter to them what things cost.” Al Giaquinto of Plum Builders of East Hampton, N.Y., says that his customers are looking for the same high quality in their pool houses they want in their kitchen and bathrooms. He may use French limestone, Italian giallo silva marble and nickel hardware in his pool house jobs, which can cost $500 a square foot. In East Hampton, where a “good third” of all new construction costing more than $1 million contains plans for a pool house, according to building inspector John Bishop, the size is limited to 200 square feet and it cannot contain a stove or heating, to prevent it from becoming a rental unit. The cost of a pool house these days, according to one local landscape developer, is in the $50,000-$200,000 range, up from $30,000-$75,000 10 years ago. (www.newsday.com)
Newsday (5/18/06); Carol Polsky

Harmonic Emergence

The test of good outdoor design is its ability to create a sense of ease, according to Sarah Susanka and landscape designer Julie Moir Messervy, co-authors of a new book, “Outside the Not So Big House.” For example, the typical elevated deck, they say, makes the home owner feel exposed and disconnected, and a deck will feel more comfortable when it is on the ground floor. The authors say the focus should be on designing a landscape as you might a house, emphasizing quality over quantity and then linking the two in an artful combination. Although the land around a home is usually what’s left after the ever-larger house is put on the ever-shrinking lot, more people are seeing the potential of the yard and hiring landscape companies to design and build living spaces, some with full-blown outdoor kitchens. Susanka advises that home owners can make the same design mistakes outdoors as those that can occur inside, heightening the importance of dealing with design professionals. (www.washingtonpost.com)
Washington Post (5/18/06); Adrian Higgins

Lawmakers Just Say ‘No’ to Anti-Housing Tax Proposals

Sen. Max Baucus (D-Mont.), right, with NAHB President David Pressly

Two members of the House and Senate tax-writing committees on May 9 told the NAHB Executive Board that they would oppose any attempts by lawmakers to reduce or eliminate the mortgage interest deduction and other housing tax incentives as part of any tax overhaul plan or to help ease the federal deficit.

Reporting that Congress was considering a $70 billion tax cut package that would increase the national debt, Baucus said, “many people think we are near a tipping point” where growing deficits could threaten the nation’s long-term economic health.

(Later that day, House and Senate GOP leaders reached an agreement on the tax cut measure that would provide a two-year extension of the reduced 15% tax rate for capital gains and dividends that are currently set to expire in 2008. The legislation would also provide a one-year “patch” that would allow about 15 million taxpayers to escape the alternative minimum tax, a parallel tax system originally designed for the wealthy but that is now ensnaring more middle-class Americans because it was never indexed for inflation. (For a related story in this issue of NBN, click here.)

Treasury Secretary John Snow, who also addressed the Executive Board, said that tax cuts enacted by the Bush Administration have stimulated economic growth and job creation, and that the best way to manage the nation’s burgeoning red ink is to reduce federal spending.

“The problem with the deficit is not that we are under-taxed, it’s because we spend too much,” said Snow.

With a permanent fix for the alternative minimum tax expected to cost about $700 billion and concerned that housing could represent a tempting target for Congress to address deficit worries, NAHB First Vice President Brian Catalde asked Baucus if he would support eliminating the mortgage interest deduction.

“I oppose that, too,” Baucus said, adding that he favors keeping the current deductions for second homes and home equity loans and is a strong supporter of the Low Income Housing Tax Credit.

Pressed even further by New Jersey builder Michael Fink, who asked the senator if he would support limiting any deductions that relate to homeownership, Baucus said: “I’m very skeptical of further limits. For most Americans, that doesn’t seem quite right.”

Rep. Tom Reynolds (R-N.Y.), a member of the House Ways and Means Committee, was even more emphatic in expressing his support for housing tax incentives.

Recalling a past discussion with Secretary Snow on the issue of tax reform, Reynolds told the NAHB leadership: “I said, ‘over my dead body’ will we lose the mortgage interest deduction or real estate property tax deduction.”

Like Baucus, Reynolds also voiced strong support for maintaining existing housing tax provisions on second homes, the Low Income Housing Tax Credit and home equity loans.

In December, the President’s Advisory Panel on Federal Tax Reform presented recommendations to the Treasury Department that would do away with all of the current housing tax incentives and replace the mortgage interest deduction with a much more limited 15% tax credit.

The tax panel’s proposals represent a radical departure from America’s decades-long commitment to federal tax polices that promote homeownership and the production of affordable rental housing. Neither Treasury Secretary Snow nor President Bush is under any obligation to follow the panel’s recommendations.

“One of the risks in tax reform is unintended consequences,” said Snow. “We must make sure we understand its implications. We want tax reform but not anything that harms homeownership. Before we send any tax proposals to the President, we will look at all the recommendations in the panel’s report. It’s a starting place, not a finishing point.”

Stating that there are four times as many tax preparers in the U.S. as there are firefighters, Snow added that the “heart of reform has to be some form of simplification.”

Looking ahead to the 2006 congressional elections, Reynolds, who also chairs the National Republican Congressional Committee, told builders he is confident that the GOP can retain control of the House, even though the President and Congress are suffering low ratings in the polls.

Noting that the Democrats need to pick up 15 House seats in November to unseat the Republicans, Reynolds said that there are only 35 seats out of 435 that are competitive. For the Democrats to get control of the House, he said that they would need to win every open seat, defend their own tough races and win three-quarters of the contests where GOP incumbents are deemed vulnerable.

Following the famous edict of former House Speaker Tip O’Neill, who said that “all politics is local,” Reynolds said that his game plan for the GOP in 2006 is to focus on the grassroots level.

“We will build our races from the ground up, from seat to seat,” he said. “We want our candidates to understand the top issues in their district.”

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

New Tax Law Contains Provisions of Interest to Builders

President Bush last week signed into law H.R. 4297, the “Tax Increase Prevention and Reconciliation Act of 2005,” a $70 billion tax cut package that will extend lower rates for investors, limit the reach of the alternative minimum tax and increase the ability of small businesses to expense certain capital assets.

The legislation, which cleared the Senate on May 11 by a 54-44 vote, includes several provisions of interest to NAHB members. The new law:

To read the legislation, click here and enter H.R. 4297 in the box at the center of the page.

For more information, e-mail Rob Dietz at NAHB, or call him at 800-368-5242 x8285.

Senate Majority Whip Wants to Abolish Estate Tax

Sen. Mitch McConnell (R-Ky.)

Pledging to fight for comprehensive immigration reform and abolishing the estate tax, Senate Majority Whip Mitch McConnell (R-Ky.) on May 10 told builders that “no action on immigration is unacceptable” and that “we want to go after eliminating the death tax once and for all in America.”

Addressing more than 1,350 builders at the Hilton Washington Hotel in Washington, D.C. shortly before they embarked to Capitol Hill to meet with their lawmakers as part of NAHB’s annual Legislative Conference, McConnell said that there is no easy solution on immigration.

“I believe that securing the border alone and doing nothing else doesn’t solve the problem,” said McConnell, who in his post as majority whip serves as the Senate’s second-ranking Republican and helps to set the chamber’s legislative agenda.

He added that guest workers are needed to support the Bluegrass State’s agriculture industry, and while he voiced support for such a measure, he said it should not “include anything that sounds like amnesty.”

“We are a country of laws. If you are rewarded (through amnesty), that sends the wrong message,” he said.

Regarding the estate tax, McConnell said that 80% of Americans want to repeal it. “I don’t believe you should visit the undertaker and the IRS on the same day,” he said.

In the coming weeks, he said he would work to bring legislation to the Senate floor that would entirely abolish the estate tax, and if he can’t garner enough support to pass full repeal, he said that he would seek to achieve a compromise “good enough to preserve virtually every family farm and small business.”

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

NAHB Members Urged to Ask Senators to Support S. 2611

With a final Senate vote on comprehensive immigration reform expected as early as May 25, NAHB has alerted all its members to contact their senators and ask them to support S. 2611, which is of critical importance to the housing industry.

The Administration has also elicited NAHB’s assistance in this endeavor. On May 17, Commerce Secretary Carlos Gutierrez asked NAHB Executive Vice President and CEO Jerry Howard for the industry’s help in working to pass a comprehensive immigration reform package that will protect the nation’s borders and create a guest worker program.

Noting NAHB’s support for the President’ televised May 15 proposals to overhaul the nation’s immigration laws (for a related story, click here), Howard told Gutierrez that the nation’s home builders are committed to achieving broad-based reform to fix the system and aid the housing industry.

Howard also took the opportunity to reaffirm NAHB’s objections to last month’s tentative softwood lumber accord between the U.S. and Canada, an initiative that he said will erode housing affordability and artificially boost lumber prices during periods of normal and slow demand through an intricate export tax and quota system.

Howard urged Gutierrez to carry that message to the White House and to policymakers, and to warn them that enacting trade policies that increase housing costs will only deepen the housing slowdown now underway, with adverse consequences for growth of the nation’s economy.

While some members of Congress want to solve the immigration problem through enforcement alone without opening any new avenues to legal employment, S. 2611, the “Comprehensive Immigration Reform Act,” contains a number of provisions that will help builders to continue to meet the demand for housing. The measure includes a guest worker program and a plan to address illegal immigrant issues.

Builders who contact their senators should tell them that stripping these provisions from the bill would place the industry in danger of losing a significant portion of its labor force and of experiencing production schedule delays at a time when labor shortages are already a significant concern.

More than 20% of the current residential construction workforce nationwide is comprised of foreign-born workers.

NAHB members should tell their senators that comprehensive immigration reform is the only solution that will meet the labor needs of the industry and that S. 2611 will support housing and the economy by protecting the labor supply.

Industry professionals are encouraged to call the U.S. Capital Switchboard at 202-224-3121, ask for their U.S. senators and tell them to:

At certain times, the U.S. Capitol Switchboard receives a high volume of calls. Those who are unable to get through can also take action by visiting www.capitolconnect.com/nahb and sending an e-mail on this issue.

For more information on immigration, e-mail Jenna Morgan Hamilton at NAHB, or call her at 800-368-5242 x8407.

Bush Immigration Reforms Supported by Builders

President Bush was commended by NAHB last week for his national address promoting comprehensive immigration reform that would secure the nation’s borders while recognizing the labor needs of housing and other industries that contribute to economic growth.

“President Bush outlined several important objectives on immigration policy that we believe the Senate should consider as it debates this important legislation,” said Jerry Howard, executive vice president and CEO of NAHB. “These include protecting and securing our borders, establishing a guest worker program that would meet the needs of our economy, helping employers to verify the legal status of their employees and creating a legal path for foreign workers to apply for citizenship.”

Comprehensive immigration reform is critical to our country’s safety and economic health, Howard added. While the nation’s home builders continue to support strong border security measures, it is also vital that immigration legislation include a system by which immigrants can legally enter the country to work.

It is estimated that the residential construction industry will need to build 18 million new homes during the next decade, generating more than 1 million new jobs.

Recognizing that foreign workers are essential to sustaining the nation’s workforce, President Bush said that a temporary worker program “would ease the financial burden on state and local governments by replacing illegal workers with lawful taxpayers.

In opposing amnesty, the President proposed a rational middle ground between granting an automatic path to citizenship for every illegal immigrant and a program of mass deportation.

“I believe that illegal immigrants who have roots in our country and want to stay should have to pay a meaningful penalty for breaking the law, to pay their taxes, to learn English and to work in a job for a number of years,” Bush said. “People who meet these conditions should be able to apply for citizenship, but approval would not be automatic, and they will have to wait in line behind those who played by the rules and followed the law.”

“The President has consistently called for passage of a comprehensive immigration reform policy that addresses the future needs of the U.S. economy, as well as how to handle the millions of undocumented workers currently in the U.S.,” said Howard. “This approach is similar to legislation pending in the Senate authored by Sens. Chuck Hagel (R-Neb.) and Mel Martinez (R-Fla.). We urge the Senate to move quickly on the Hagel-Martinez bill.”

To read that legislation, click here and enter S. 2611 in the box at the center of the page.

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

Election Web Site Aimed at ‘Building the Vote’

Building industry professionals who are interested in becoming involved in the political process and helping to elect pro-housing candidates on the federal and state level are encouraged to log on to www.BuildingTheVote.com, NAHB's political and grassroots action center.

Through a partnership with the U.S. Chamber of Commerce, NAHB’s BuildingTheVote campaign empowers hundreds of thousands of pro-business Americans who contribute to the ongoing success of the home building industry to become active participants in this year’s elections.

“The past few elections have taught us an important lesson: elections can be won or lost by just a few votes,” said NAHB President David Pressly. “BuildingTheVote.com is an interactive Web site that will allow you to register to vote, apply for absentee or early voting, find out key election dates and deadlines, locate your polling place and learn more about the candidates running and the issues at stake.”

Fully 80% of the states today allow voters to go to the polls before Election Day — some as much as 43 days early. BuildingTheVote.com provides information and assistance for voting-by-mail or in-person early voting

The Web site also contains important information on federal and state elections throughout the country. Registering with BuildingTheVote will provide access to information on candidates running anywhere in the U.S.

BuildingTheVote allows voters to demonstrate their commitment to responsible policies that meet the nation’s ongoing housing needs by enabling them to contact their elected officials about the issues that most affect their businesses. By clicking on such “hot topic” links as immigration, storm water permitting and tax reform, industry professionals can contact their legislators and let them know where they stand on these important issues.

The site also contains information on BUILD-PAC, NAHB’s political action committee, which is dedicated to helping elect pro-housing candidates to Congress.

“Political participation is one of the most precious liberties we enjoy as citizens, and it begins with you and me,” said Pressly. “I urge all housing professionals to take a few minutes and visit BuildingTheVote.com. Together, we can make a contribution to our communities, our industry and our families, one vote at a time.”

For more information, e-mail Ashley Feaster at NAHB, or call her at 800-368-5242 x8126.

Housing Starts Dip 7.4 Percent in April

Total housing starts dipped 7.4% in April to a seasonally adjusted annual rate of 1.849 million units, according to figures released by the Commerce Department last week, leaving new-home construction for the first four months of the year down 0.8% from the same period of 2005.

Single-family housing starts declined 5.6% last month to a pace of 1.535 million units and multifamily construction slid 15.1% to a 314,000-unit rate.

“NAHB’s surveys of builders have been showing a slow decline in confidence since the middle of last year,” said NAHB President David Pressly, “and builders have been trimming production of new units to maintain balance between supply and demand. Builders are reacting properly to market conditions.”

“The declines in starts and permits for April reflect a natural pay-back for the weather-related surge in production earlier in the year, as well as builder adjustments to eroding demand and rising inventories,” said NAHB Chief Economist David Seiders. “We continue to believe that the evolving slowdown represents an orderly adjustment toward more sustainable levels of housing production, following the record surge in 2005 that was fueled by extraordinary demand for single-family homes and condo units by investors/speculators.”

“NAHB’s forecast continues to show a 6.1% decline in total housing starts for 2006 as a whole, following an equivalent increase last year,” Seiders added.

The regional patterns of housing starts were mixed in April. Construction rose 9.1% in the Northeast and 16.3% in the Midwest, in both cases following sizeable declines in March. Starts were down 9.7% in the West and 16% in the South.

Building permit issuance slowed 5.4% in April to a seasonably adjusted annual rate of 1.984 million units, reflecting sizeable declines in the Northeast, Midwest and South and a small increase in the West. Single-family permits were down 4% to an annual pace of 1.502 million units and multifamily permits dipped 9.4% to 482,000 units.

Anticipate the trends, make better decisions and improve your bottom line. HousingEconomics.com, the online publication from NAHB Economics Group, is your single source for market analysis, forecasts, housing statistics and more. In-depth analysis and detailed Excel tables and overviews are available for all the state and metro forecasts.

HousingEconomics.com combines unique scientific research with practical applications providing insights that are original and useful. This interactive Web site at the executive level provides critical data and information quickly, easily and frequently, and includes the following features:

Seiders Says, 'Builders Have Not Lost Touch With Demand' on the NAHB Economics Blog

NAHB Chief Economist David Seiders says that "builders have not lost touch with demand" on NAHB's economics blog, “Seiders on Housing” — an informal Internet-based forum dealing with economic issues, housing trends, survey research and other topics affecting the housing sector of the economy.

Log onto the blog at http://nahbblog.blogs.com and get direct access to Seiders' expert opinions, projections and responses. Then let Seiders know what you think by giving your perspective.

Builder Expectations Reflect Slowing Market

The nation’s single-family home builders continued this month to adjust their expectations for the housing market in light of rising mortgage rates, deepening affordability issues and the retreat of investors and speculators, sending the NAHB/Wells Fargo Housing Market Index (HMI) down six points, to a reading of 45, its lowest level since mid-1995.

“Based on historical experience, particularly the 1994-1995 episode, the pattern of movement in the HMI is not inconsistent with the orderly cooling-down process we’re projecting for home sales and single-family housing starts in 2006,” said NAHB Chief Economist David Seiders. “We expect new-home sales to be off by 12% from the record posted in 2005. Single-family starts, supported by large builder backlogs of unfilled orders and reconstruction in the wake of last year’s record-breaking hurricane season, should be down by about 7% from the 2005 record.”

Derived from a monthly survey that NAHB has been conducting for nearly 20 years, the index gauges builder perceptions of current single-family home sales, sales expectations for the next six months and traffic of prospective buyers on a seasonally adjusted basis. Any number over 50 indicates that more builders view sales conditions as good than poor.

All three components of the index declined in May: current sales and sales expectations for the next six months each fell five points, to 50 and 54, respectively; and builders’ assessment of prospective buyer traffic dropped seven points, to 32.

Builder confidence eroded three points to 47 in the Northeast, two points to 30 in the Midwest, six points to 51 in the South and eight points to 61 in the West.

Find out in HousingEconomics.com’s Long-Term Forecast. HousingEconomics.com includes downloadable Excel tables featuring the housing starts forecast, GDP, demographics and more.

Log onto the blog at http://nahbblog.blogs.com and get direct access to Seiders' expert opinions, projections and responses. Then let Seiders know what you think by giving your perspective.

Housing Affordability Up Just a Notch in First Quarter

Indianapolis was the nation's most affordable major housing market for a third consecutive quarter, according to the NAHB/Wells Fargo Housing Opportunity Index (HOI) for this year’s first quarter, which was released last week.

The first-quarter index found housing affordability across the nation virtually unchanged from the final three months of 2005, as slightly lower home prices and higher household incomes helped offset an upward movement in mortgage rates. The HOI rose marginally from its lowest level on record, 41.0 at the end of last year, to 41.3 in the first quarter of 2006.

"The latest HOI shows that only 41.3% of new and existing homes that were sold during this year's first quarter were affordable to families earning the national median income," said NAHB President David Pressly. "This is down from just over 50% of all homes sold in the first quarter of 2005 that were affordable to the average family."

"Compared to the fourth quarter of last year, the median price of all new and existing homes that were sold during the first quarter of 2006 declined 1.5%, while the national median income, as calculated by the federal government on an annual basis, was adjusted upward from $58,000 to $59,600," explained NAHB Chief Economist David Seiders. "These factors kept housing affordability from sliding further despite the fact that the national weighted interest rate on fixed- and adjustable-rate mortgages rose 18 basis points in the period, from 6.21% to 6.39."

In Indianapolis, just over 90% of homes sold in the first quarter were affordable to families earning the area's median household income of $65,100. The median sales price of all homes sold in Indianapolis during that time was $113,000 — down from $120,000 at the end of 2005.

Also near the top of the list of affordable major metro areas were: Youngstown-Warren-Boardman, Ohio-Pa.; Detroit-Livonia-Dearborn, Mich.; Rochester, N.Y.; and Buffalo-Niagara Falls, N.Y., in that order.

Among smaller housing markets with populations below 500,000, the most affordable were: Lansing-East Lansing, Mich.; Davenport-Moline-Rock Island, Iowa-Ill.; Lima, Ohio; Battle Creek, Mich.; and Bay City, Mich., respectively.

Los Angeles-Long Beach-Glendale, Calif. kept its standing in the first quarter as the nation’s least affordable major metro market, with just 1.9% of new and existing homes sold in the area being affordable to families earning a median household income of $56,200. The median price of the homes sold in the area during the first quarter was $500,000, which was unchanged from the previous quarter.

Other major metros at the bottom of the housing affordability chart included: Santa Ana-Anaheim-Irvine, Calif.; San Diego-Carlsbad-San Marcos, Calif.; New York-White Plains-Wayne, N.Y.-N.J.; and Nassau-Suffolk, N.Y.

Santa Barbara-Santa Maria, Calif. was the least affordable smaller housing market, followed by Modesto, Salinas, Merced and Napa, all of which are located in California.

Seiders Says, 'Builders Have Not Lost Touch With Demand' on the NAHB Economics Blog

Log onto the blog at http://nahbblog.blogs.com and get direct access to Seiders' expert opinions, projections and responses. Then let Seiders know what you think by giving your perspective.

Pact Would Keep Lumber Prices High Even as Demand Softens

Even with the housing market showing signs of cooling and lumber costs edging down as demand eases, American home buyers will be forced to pay a premium for lumber if a tentative managed trade agreement between the U.S. and Canada goes into effect in the coming months, according to NAHB.

“Once enacted, these trade barriers would harm housing affordability by artificially boosting lumber prices during periods of normal or low demand through a complicated system of export taxes and quotas that would be triggered when the Random Lengths composite prices fall below $355 per 1,000 board feet,” said Jerry Howard, executive vice president and CEO of NAHB. “In addition to higher prices, it would also lead to market disruptions as Canadian mills accelerate or withhold shipments in anticipation of changes in quotas or fees.”

Under the proposed accord, taxes on Canadian lumber shipments into the U.S. would move progressively higher once the price drops below thresholds of $355, $335 and $315 per 1,000 board feet.

The price of lumber was $377 per 1,000 board feet when the pact was announced on April 28 and has since fallen to $345 as supplies have increased and demand has slackened.

“By the time the agreement is finalized, prices may well be down below $315, in which case its implementation would be a severe jolt to the market,” said Howard.

If the settlement is enacted and results in new trade barriers limiting Canadian lumber shipments into the U.S., Howard said that NAHB would help builders seek lumber sources from other countries such as Germany, Sweden and Russia, each of which has increased lumber shipments to the U.S. sharply over the past five years. In addition, NAHB is promoting the use of steel and other alternative building materials wherever practical.

In the interim, U.S. consumers continue to pay tariffs totaling nearly 11% on Canadian lumber shipments, despite several unanimous rulings by North American Free Trade Agreement (NAFTA) panels that U.S. lumber producers are not threatened with injury from Canadian softwood lumber shipments, and that there have been no significant subsidies provided to Canadian producers. The verdicts have called for the elimination of tariffs and for the U.S. Customs Service to refund to Canada the more than $5 billion in duties that have been collected.

Although a NAFTA ruling carries the weight of law in Canada, the U.S. and Mexico, the Administration has failed to implement decisions that invalidate the lumber duties and return all duties paid out by Canadian firms.

“In 2002-2003, when the lumber tariff was 27% and housing starts were in the 1.7 million to 1.8 million range, the price of lumber was routinely below $315 per 1,000 board feet,” said Howard. “If this agreement goes into effect and the housing market continues to gradually cool down, U.S. lumber consumers would essentially be paying taxes to support the Canadian provinces and higher prices because of quotas. In short, this is one bad deal for American housing consumers.”

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

Seiders Says, 'Builders Have Not Lost Touch With Demand' on the NAHB Economics Blog

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NAHB Board Salutes 18 Millionth VA Home Loan Recipient

At its meeting in Washington, D.C. on May 13, the NAHB Board of Directors helped celebrate one of the most widely used veterans benefits in the country with a presentation by Secretary of Veterans Affairs R. James Nicholson and NAHB President David Pressly to the recipient of the 18 millionth VA-guaranteed home loan.

“VA’s home loan guaranty program has been helping veterans purchase homes for more than 60 years,” Secretary Nicholson said. “This VA no-downpayment loan program reflects our nation’s appreciation of the brave men and women who put on our country's uniforms in defense of freedom and our way of life. It also highlights VA’s contribution to turning the United States into a nation of home owners.”

An award was presented to veteran Robert A. Laurent of Kyle, Texas. Laurent, an Army veteran and Purple Heart recipient, was discharged after four years in uniform because of combat-related injuries in Iraq. His family's new home was built by Legacy Homes of Plano, Texas, a division of Meritage Homes Corp. of Scottsdale, Ariz., and purchased through First Continental Mortgage, Ltd. of Houston. Those two companies were represented at the ceremonies by Mitch Schwartz, vice president of operations; and Richard D. Davis, senior vice president, respectively.

“The no downpayment VA program has been a cornerstone of the nation’s housing finance system for more than 60 years,” said Pressly. “It has opened the door to homeownership for millions of veterans who have, in turn, been able to build equity and household wealth, put down roots in the communities where they live and enjoy the many benefits of owning a home.”

Since 1944 when President Franklin Roosevelt signed the Servicemen's Readjustment Act into law, the GI Bill, as it is popularly known, has secured more than $892 billion of financing for veterans' and service members' home loans, Nicholson said. In fiscal year 2005 alone, VA guaranteed more than 165,000 loans for mortgages valued at more than $24.9 billion.

In his remarks to the board, Nicholson also acknowledged the volunteer efforts of home builders associations around the country on behalf of soldiers deployed to Iraq and their families.

VA-guaranteed home loans are made by banks and mortgage companies to veterans, service members and eligible reservists. With VA backing a portion of the loan, veterans can receive a competitive interest rate without a downpayment, making it easier to buy a home.

On Jan. 1, the VA loan guaranty limit for no-downpayment loans was increased to $417,000. The previous ceiling was $359,650.

For more information about VA home loan benefits, click here, or call 800-827-1000.

First Construction-to-Permanent Loan Rural Home Built

The first home to be financed using the Rural Housing Service’s construction-to-permanent loan pilot program offered through Chase Home Finance has recently been constructed by an NAHB member.

Located near Rayne, La., the home was built by Lafayette, La.-based Manuel Builders LLC.

The construction-to-permanent loan offers the home buyer a single closing, which locks in the terms of the permanent mortgage loan when construction begins, and eliminates the need for the home builder to obtain construction financing. Because the home buyer is also the borrower on the construction loan, the buyer has a high level of commitment to the home purchase.

The U.S. Department of Agriculture’s Rural Housing Service finances purchases of homes in rural America. The pilot program, which began in late 2005, is being offered to home buyers having homes built in rural areas of Alabama, California, Colorado, Florida, Georgia, Hawaii, Louisiana, Michigan, Mississippi, North Carolina, Ohio, Oregon, Texas and Washington.

For further information, e-mail Brent Cooper, vice president of wholesale construction for Chase Home Finance, or call him at 954-426-5828.

Eye on the Economy: NAHB Still Forecasts a 6.1% Decline in Starts

The Commerce Department's "advance" estimate of real Gross Domestic Product (GDP) for the first quarter of this year showed robust 4.8% growth, well above sustainable trend growth.

Furthermore, data received since then for construction activity, business inventory investment and the trade balance in March point toward a substantial upward revision (toward 6%) when the "preliminary" estimate for the first quarter is released on May 25.

Fortunately, GDP growth is slowing toward a more sustainable pace in the second quarter. NAHB's forecast currently shows 3.4% growth, and data in hand (including housing starts for April) suggest that growth could be even slower than that. In any case, the U.S. economy definitely is slowing down at this time, and we continue to expect a pattern of below-trend growth (around 3%) in the second half of this year and in 2007.

That's actually a positive development, since a slowdown is essential to prevent overheating of the economy and an eventual rough landing.

Nearly three years of average above-trend GDP growth have generated solid growth in employment and systematically reduced the degree of slack in U.S. labor markets — demonstrated by a falling unemployment rate from the cyclical high in mid-2003.

The unemployment rate held at an expansion low of 4.7% in April, but employment growth was somewhat disappointing (a gain of 138,000). Employment growth has been quite volatile on a month-to-month basis, of course, and the April reading followed above-trend gains in both February and March. Furthermore, both average weekly hours and average hourly earnings showed solid gains in April.

Everything considered, underlying conditions in the labor market remained firm in April.

The evolving slowdown in GDP growth will prevent the unemployment rate from falling much (if any) further in the near term, and NAHB's forecast shows an upward drift during the second half of this year and in 2007. While this may sound like an adverse development, some loosening of labor market conditions probably is essential to maintenance of an economic expansion with low inflation in coming years.

Core Inflation Is Now Close to the Upper End of the Fed's ‘Tolerance Zone’

The extended period of above-trend GDP growth and associated shrinkage of slack in U.S. labor markets has generated growing concern on the inflation front. Indeed, the Fed has been quite worried about upward pressures on "core" inflation (excluding prices of food and energy) from tightening labor markets as well as from soaring energy prices that inevitably make their way into the core through business cost structures.

Core inflation readings for the first quarter of 2006 were reasonably well contained, although various measures definitely were in the process of firming up. Furthermore, available data for April show some further acceleration.

The core Producer Price Index (PPI) for finished goods was benign in April, but the core PPIs at earlier stages of production showed more substantial increases. The core Consumer Price Index (CPI) definitely is on an upward path, showing annualized increases of 3.6% in both March and April. The April reading was up by 2.3% on a year-over-year basis, not far below our estimate of the upper bound of the Fed's tolerance zone for this inflation measure (2.5%).

The Fed Hikes Short-Term Rates Again and Frets About Inflation Pressures

As expected, the Fed enacted another quarter-point increase in short-term interest rates at the conclusion of the May 10 meeting of the Federal Open Market Committee (FOMC), raising the federal funds rate target to 5%. This was the 16th consecutive quarter-point rate hike since mid-2004.

The FOMC statement took note of the strong GDP growth pattern early this year but expressed an expectation of slower growth in the near term, "partly reflecting a gradual cooling of the housing market."

The statement also noted that core inflation was well-contained in the first quarter, while stressing that "possible increases in resource utilization, in combination with the elevated prices of energy and other commodities, have the potential to add to inflation pressures."

With respect to future policy moves, the FOMC statement said that "some further policy firming may yet be needed to address inflation risks," but the statement also emphasized that future policy moves will be highly data-dependent.

Our current forecast assumes that the Fed will hold the current policy stance for some time, with a nominal funds rate of 5% and a "real" rate around 3%. However, evidence of slowing economic growth and benign core inflation will have to be convincing to hold off yet another quarter-point rate hike at the next FOMC meeting on June 29. The April reading on core CPI inflation certainly has tilted the odds toward at least one more rate hike this year.

Long-Term Rates Are at Four-Year Highs and May Be Heading Higher

Long-term interest rates fell during the first year of the Fed's extended rate-hike process, provoking former Fed Chairman Alan Greenspan to declare a "conundrum" in fixed-income markets about a year ago. However, long-term rates rose to some degree during the second half of 2005 and they have moved decisively higher so far this year. Indeed, long-term rates now are at four-year highs and the Treasury yield curve now has a significant upward slope despite the Fed's ongoing process of short-term rate hikes.

Expectations of future monetary policy adjustments, as well as inflation expectations, are built into the current yield structure, and the future course of long rates will depend on how well actual developments square with those expectations.

NAHB's forecast allows for a slight further rise in 10-year Treasury yields this year (to 5.2%), and we're showing a similar rise in the fixed-rate home mortgage yield (to 6.7%). This forecast is contingent on a slowdown in economic growth, a slowdown in employment growth, an uptick in the unemployment rate, containment of core inflation and maintenance of a 5% funds rate.

While the slowdown in growth appears to be underway and the labor markets may loosen before long, the inflation picture seems to be deteriorating and the odds of another Fed rate hike have just risen.

Consumer Sentiment Recedes and Home Builder Sentiment Contracts Further

Our projected slowdown in economic activity is concentrated in household spending on consumer goods and housing, and both are vulnerable to high energy costs and rising interest rates. Indeed, these two components of the economy are closely linked since consumer spending on things like furniture and appliances is connected to home sales, and overall consumer spending is related to wealth creation generated by house price increases.

The University of Michigan's preliminary consumer sentiment index for May fell sharply as Americans fretted over climbing gasoline prices and worried about future economic conditions. The decline was the sharpest since the reversal provoked by hurricanes Katrina and Rita last year.

Builder confidence also fell substantially in May, continuing the pattern of erosion begun last July. NAHB's single-family Housing Market Index (HMI) fell to 45, the lowest reading since mid-1995.

Ironically, the 1995 episode represented a mid-cycle "correction" provoked largely by the Fed's efforts to rein in that expansion and extend its life. The motivation behind current monetary policy management appears to be essentially the same.

Housing starts hit a cyclical high in the first quarter of this year, despite the obvious deterioration in indicators of housing demand from the highs of last year (including our HMI) and well-documented increases in both sales cancellations and unsold inventories.

This apparent disconnect could be pinned partly on the impacts of unusually good winter weather on the starts pattern as well as on large backlogs of orders that builders were still building out. However, the rising cancellations and inventories stuck out as emerging trouble signs.

Fortunately, housing starts and permit issuance moved down convincingly in April — by 7.4% and 5.4%, respectively. These declines reflected a natural pay-back for the weather-related surges in the first quarter as well as builder adjustments to eroding demand and rising inventories.

We continue to believe that the evolving housing slowdown essentially constitutes a moderate adjustment toward more sustainable levels of production, following the record surge in 2005 that was fueled by extraordinary demand for single-family homes and condo units by investors/speculators.

So far, total housing starts are down by nearly 1% on a year-to-date basis, and NAHB's forecast continues to show a 6.1% decline in total housing starts for 2006 as a whole — following an equivalent increase last year.

We're projecting relatively large declines for single-family starts and the condo component of multifamily starts.

NAHB Chief Economist David Seiders analyzes the economy from the point of view of the housing market every other week in the free e-newsletter, “Eye on the Economy.” The preceding is a reissue of his May 17 edition. To subcribe to “Eye on the Economy,” click here.

Seiders Says, 'Builders Have Not Lost Touch With Demand' on the NAHB Economics Blog

Log onto the blog at http://nahbblog.blogs.com and get direct access to Seiders' expert opinions, projections and responses. Then let Seiders know what you think by giving your perspective.

Builder's Tip: Shop Vac Works for Hard-to-Fill Glue Ups

While building a set of stairs recently, I noticed that a crack had developed in the bottom of one of the vertical-grain fir stringers.

Because the stairs were exposed on both sides, I wanted to glue and screw the crack closed, but I had difficulty filling the crack with glue.

To solve the problem, I used a co-worker’s shop vac to help fill the crack with glue. Here's what I did:

BuilderBooks.com is your source for training and education products for the building industry. The official bookstore for NAHB, BuilderBooks.com offers award-winning publications, software, brochures and more available in both English and Spanish.

Explore the latest housing industry news and information on www.nahb.org — the official public and members-only Web site of NAHB.

With an expansive "For Consumers" section, www.nahb.org provides a credible source of information on home building and remodeling for your customers. The Web site also provides a wealth of member discount programs and business resources developed for you.

Plus, to make it easy to get what you need, the Web site has built in time-saving features like My NAHB to customize the site to your interests, My Favorites so you can select specific links to appear on your www.nahb.org Home page and online Staff Directories so you can find NAHB housing industry experts quickly and easily.

Use www.nahb.org to stay on top of the latest housing industry news, access your council and committee materials, register for courses and events and stay abreast of NAHB’s efforts to promote housing.

See Success With Biztools on Membership Day Webcast

City Life Historic Properties President and CEO — and enthusiastic Biztools user — Anne Riggle (right) tours a company property with project manager Christina Wakefield.

Tune in to NAHB's National Membership Day Webcast Tuesday, May 23, and pick up valuable information about how Biztools can help you build a better home building business.

Anne Riggle, president and CEO of City Life Historic Properties in Baltimore; Antonio Giordano, Jr., of Consultants Inc. in Providence, R.I.; and Chuck Austin, president of Austin Signature Homes of Englewood, Colo., will tell members how they have relied on Biztools in their day-to-day operations.

Learn more about these and other Biztools at www.nahb.org/biztools and hear what these builders have to say about Biztools on the Webcast.

The National Membership Day Webcast will be held from 2:00-5:00 p.m., Tuesday, May 23, and can be found on the NAHB Web site home page: www.nahb.org.

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.

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’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:

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.

Build Your Knowledge at the Custom Builder Symposium

The Custom Builder Symposium will be held at the Lake Las Vegas Resort in Nevada on Oct. 27-29.

Custom home clients continually raise the bar on what they expect from builders. The 2006 Custom Builder Symposium, NAHB’s premier event for custom builders, gives custom builders the opportunity to expand their knowledge base, deliver on their clients’ expectations and ensure profitability.

The symposium will be held Oct. 27-29 in the Lake Las Vegas Resort, Nev. and registration is now open.

Featuring world-class education, plenty of networking opportunities and a practical take-home workbook packed with tips on marketing, management and customer service, the Custom Builder Symposium is a can't-miss opportunity for custom builders to learn from peers who build high-end homes for demanding customers.

"It will not teach you how to pour concrete any better than you already do or teach you how to plumb cut a rafter, but it will teach you how to put money to your bottom line," said past symposium attendee and NAHB Custom Home Builder Committee Chair Dave Stormont, of Stormont Co., Inc. in Kitty Hawk, N.C.

To learn more about the Custom Builder Symposium or to register, go to www.nahb.org/custom.

NAHB Has More Than 250 Resources to Help You Run Your Business More Profitably

Resources are added weekly, so bookmark www.nahb.org/biztools to go directly to these vital business management resources.

To subscribe, visit www.nahb.org/BoB on the Members Only side of the NAHB Web site.

Software and technology solutions providers interested in being listed can sign up for:

Remodelers Report Moderate Growth in First Quarter

Remodelers reported moderate growth in the first quarter of 2006, according to the NAHB Remodeling Market Index (RMI), which saw market conditions move up from 46.6 for the closing quarter of 2005 to 48.1 and future expectations advance from 47.5 to 48.9

Current market conditions on the RMI for owner-occupied units rose from 48.9 to 53.8, while renter-occupied units fell from 40.4 to 36.7. Future expectations for owner-occupied units moved up from 50.4 to 53.2, while the renter-occupied component declined from 37.8 to 30.4. Any number over 50 indicates that market conditions are expanding in the view of the majority of remodelers who are surveyed for the index.

Remodeling accounts for 40% of all residential construction and improvement spending and almost 2% of the U.S. economy.

“The $11 trillion in home owner equity continues feeding the remodeling market,” said Remodelors™ Council Chairman Vince Butler, CGR, CAPS, GMB. “With remodeling spending surpassing $200 billion for the first time, we see continued long-term growth in the industry.”

“Though the frenzy in home buying is slowing down, the remodeling spending associated with purchasing a home usually lags behind,” said NAHB Chief Economist Dave Seiders. “The run-up in home sales during the past five years will fuel remodeling growth for the next several years, and the long-term growth looks to be solid as well.”

Regionally, the index found strong growth across the country, with the exception of the West, which nevertheless remained within the positive range. Current conditions in the Northeast climbed nearly 10 points from 41.6 to 51.1, and the region’s future conditions rose from 41.0 to 47.3. Current conditions increased from 41.1 to 44.3 in the Midwest, where future expectations were up a scant 0.4 point, to 46.6.

A special question included in the first-quarter survey asked participants about the age of their customers. Of the remodelers who were surveyed, 91% said that they had done work for baby boomer home owners aged 46-64; 26% had lined up jobs with 36-45-year-old GenXers; 13% had senior clients 65 and older; and 2% had worked with Gen Y households who are 35 and under.

For more information, e-mail Jim Lapides at NAHB, or call him at 800-368-5242 x8451.

Home Remodeling Heads for Another Record Year

Based on NAHB analysis of recently released third-quarter data from the U.S. Census Bureau, Americans spent an estimated $215 million on residential remodeling in 2005, a record.

As the industry enters its peak season, NAHB economists are projecting that the volume of residential remodeling will surge 13.2% this year, the largest in a decade, to a new record of $238 billion.

“We have seen extraordinary growth in the remodeling industry over the past year, and we expect to surpass that in 2006,” said Vince Butler, chair of the NAHB Remodelors™ Council and president of Butler Brothers Corporation in Clifton, Va.

Butler, along with NAHB Chief Economist David Seiders, participated in a recent Remodelors™ Council teleconference, held in conjunction with celebration this May of National Home Remodeling Month. “National Remodeling Month marks the start of the remodeling season,” Butler said, “and we see this as an opportunity for our council to remind home owners of the many resources we offer those looking to hire a remodeler.”

Butler noted that home remodeling offers numerous benefits to home owners who want to change their living environment without uprooting their family and moving. Home improvements can add more space for a growing family or older family member, improve energy efficiency and increase the resale value of the home.

“The most popular remodeling projects continue to be kitchens and baths, which usually get the most return on the investment,” Butler said during the teleconference. “Home owners want to concentrate on the areas where they spend the most time.”

Retirees, especially the baby boom generation, increasingly prefer to be able to “age in place” or continue living in their homes safely, independently and comfortably, regardless of age or ability level. To help the remodeling industry adapt to meet those specific needs, the Remodelors™ Council created the Certified Aging in Place Specialist (CAPS) designation, which is the only program of its kind.

“The majority of our customers are baby boomers, although we are also seeing strong growth within the Gen-X market as well,” Butler said. “People want to let their house adapt with their needs as they change over time.”

The most critical decision home owners will make when embarking on a remodeling project is choosing the right professional for the job, he said. Choosing a professional remodeler can save both time and money by ensuring that the job is done right the first time and results in what the home owner envisioned. Professional remodelers understand that keeping consumers comfortable during the work and completing the project successfully depend on effective communication and follow-through, and they will guarantee the quality of their workmanship with a warranty.

“During this busy time, home owners need to be particularly careful about unscrupulous contractors,” noted Butler. NAHB offers guidelines on how to select a professional remodeler.

For more information, e-mail Jim Lapides at NAHB, or call him at 800-368-5242 x8451.

4-D Modeling: Is 'Virtual Building' In Your Future?

When Frank Gehry, the architect of such prominent structures as the Guggenheim Bilbao Museum and the Walt Disney Concert Hall, speaks, the building design community listens. And right now he’s talking about building information modeling (BIM).

BIM is a computerized model — a “virtual building” database ― that stores all of your project’s information in a variety of forms and formats that are easily retrievable by every discipline involved in a project. BIM can generate specifications, drawings, schedules and other documents so that everyone involved in the project has access to the same information ― in the format required for their specific task.

BIM also can generate work schedules, coordinate documents and — since everyone is working on the same model — update all that information universally as new design data is added or work is performed.

Gehry said BIM is creating a “culture of collaboration” among architects, specifiers, engineers, contractors, product representatives and others in the construction industry because of its ability to tie so much information together at once.

“You cannot do this without the architect, engineer and everyone working together,” he said during the CSI (Construction Specifications Institute) Show earlier this year.

BIM will have a profound effect on the way everyone in the design community does their jobs, especially architects.

The Walt Disney Concert Hall in Los Angeles

What’s particularly revolutionary about BIM is the addition of the fourth dimension of time to traditional CAD systems that operate in 2-D or 3-D.

In 4-D, BIM will be able to provide object- and process-oriented building information continuously over time. This will include project drawings, physical asset management data, information needed for decommissioning and everything in between.

Owners and managers will recognize the real value that BIM presents over the full life cycle of a facility because they will be able to take data generated during design and construction and modify and re-use it throughout maintenance and repair activities.

Many industry leaders like Gehry are already using BIM in advanced forms to design and construct buildings. In addition to the Bilbao Museum and the Walt Disney Concert Hall, renovations of the Sydney Opera House and design of the Freedom Tower on the site of the World Trade Center in New York involved BIM. Several federal agencies, including the Department of Defense and the General Services Administration, now require contractors to incorporate BIM in their projects.

BIM will give designers a faster, richer design process. It will give owners more budget control through predictions about the project’s construction process. And contractors will have fewer surprises. BIM can generate schedules, coordinate documents and automatically update drawings as new data is added. They are a natural step for anyone dedicated to construction documents that meet the Construction Specifications Institute’s “4 Cs” — clear, concise, correct and complete.

Because it brings advantages to every discipline involved in creating and sustaining the built environment, the shift to BIM is expected to be very quick.

While we know the benefits that BIM will bring, and which industry leaders are blazing that trail, we don’t quite know where that trail is heading or how long the journey will be. This presents a conundrum for architects, who will have to make some very important decisions over the next several years.

The Frank Gehry-designed Guggenheim Bilbao Museum

Every individual architect and firm must take a close look at their bottom lines and business plans and choose the right time to move on BIM. They will have to walk a very narrow tightrope: Act too soon and the technology may evolve away from their choices and render their substantial investment in time and money obsolete. Wait too long, and competitors may move ahead and cost them business.

Once architects decide to adopt BIM, they also will have to think about the necessary training involved. Those who have been in the profession for 20 years or more surely remember the CAD revolution — and the challenges it presented. Like CAD, BIM will involve a substantial learning curve.

Fortunately, members of the commercial building community have some time to get familiar with BIM.

My advice, get to know and understand the basic concepts of BIM — and to accept that this revolutionary technology is here to stay.

While each industry professional will have to make his or her own choice, plenty of sources of information about BIM exist.

Because of its historic role as a provider of building-oriented information, CSI is an important source. Visit the Web site at www.csinet.org, and watch for CSI-sponsored conferences and seminars that feature BIM-related information.

The National Institute of Building Sciences (NIBS), which is leading an effort to create a National BIM Standard (in which CSI is heavily involved), also provides information about BIM on its Web site at www.nibs.org.

The American Institute of Architects (www.aia.org), as well as individual AIA chapters, is also a good source of information. Numerous trade publications follow the issue closely as well.

As Frank Gehry made clear at the CSI Show in Las Vegas, it’s an exciting time to be involved in the construction industry. New technologies allow architects, engineers, contractors and others to do and try things that simply weren’t possible before.

To me, BIM is the most important. While no one is sure exactly where the BIM revolution will take us, we can all rest assured that when it comes it will change the way we do our jobs forever — and for the better.

Dennis Hall, FAIA, FCSI, serves as a vice president on the Construction Specifications Institute and is the founder and managing principal at Hall Architects Inc. based in Charlotte, N.C. For more information, e-mail Hall, or call him at 704-334-2101.

‘How-to Manual’ for Diversifying Into Light Commercial Building Available

“Light Commercial Construction for Home Builders: A How-to Manual for Diversifying Your Business” to help residential builders who are considering diversifying into light commercial construction is available through NAHB's National Commercial Builders Council (NCBC).

Light commercial construction is a competitive, $50 billion-a-year industry with a potential for substantial profits.

NCBC’s new how-to manual points out three areas that are keys to builders who are diversifying into the industry:

The manual explains the differences between residential and light commercial construction, methods of contracting, OSHA requirements, building materials, licensing issues and codes and standards. It reviews the common types of light commercial buildings and points out the difference between residential and commercial customers.

For more information about the manual or the National Commercial Builders Council, e-mail Petra Beane at NAHB, or call her at 800-368-5242 x8433. To download an order form, click here.

"Moving to Commercial Construction," available through BuilderBooks.com, offers the general contractor, subcontractor and designer several step-by-step methods that will make the move from residential to commercial building a successful one.

From Walls to Kitchen Counters, Concrete is Hot

Concrete gives homes superior comfort, durability and energy efficiency. However, there are technologies and decorative processes that go beyond the basement walls.

NAHB’s 2006 Concrete Technologies Tour offers participants a first-hand look into concrete and cement-based technologies. Held June 11-13 in Phoenix, this year’s tour features everything from pre-cast applications to concrete roof tiles to a concrete subdivision.

"The Concrete Technologies Tour provides builders an opportunity to see the ‘inside story’ behind the manufacturing process for cement-based building products,” said Michael H. Weber, residential director of the Portland Cement Association and president of the NAHB Concrete Home Building Council.

“In addition to seeing how products are manufactured, the opportunity to go onto job sites and see how they are being used makes this tour different from anything else offered in the building industry," Weber added.

This year, home builders will have the opportunity to gain first-hand knowledge about several of the construction industry’s latest technologies, including the use of autoclaved aerated concrete walls, post-tensioned foundations and insulated and post-tensioned masonry walls.

The tour also brings together industry experts from around the country and gives builders an opportunity to network, ask the experts and tour manufacturing facilities.

“This is a once-in-a-lifetime opportunity to get the latest information on concrete construction technologies all brought together and presented in a single conference,” said Jim Rogers, of Evaluation and Certification Services, LLC in Alexandria, Va. and CHBC member.

Online registration for NAHB’s 2006 Concrete Technologies tour ends Friday, May 26.

Be the first to answer this question correctly and win one free registration for The 2006 Concrete Technologies Tour. E-mail your answer to Dawn Faull at NAHB.

Don’t know the answer? Find out this answer and many more about the concrete industry at the upcoming Concrete Technologies Tour.

Want to Know More About Designations? Ask an Expert

"Ask an Expert" allows members to e-mail designation program graduates with questions that will help then earn their CSP, Master CSP, CMP or MIRM designations.

The graduates will field questions and concerns ranging from course content, to the designation process, to how the designation has benefited them.

So, if you're thinking about enrolling in the CSP, Master CSP, CMP or MIRM designation programs or have already started the necessary course work and have questions or concerns, visit “Ask an Expert” on the NAHB Web site.

A variety of designation holders will provide you with guidance and help you navigate the ins and outs of the program.

Whether you’re new to the industry, hope to make your next career move or want to improve your company’s bottom line, The NAHB University of Housing can assist you in your educational pursuits.

Visit www.nahb.org/education for a comprehensive listing of courses throughout the country. Be sure to visit often in order to view the most up-to-date information in your area.

At the NAHB/BALA Design Institute for Builders, you'll learn the latest in residential housing design trends from the industry's top professionals, tour beautiful award-winning homes and communities that display the best in cutting-edge architectural design, and learn how to profitably apply these design ideas to the homes you build.

The Design Institute will be held June 5-7 at the Westin Charlotte, Charlotte, N.C.

To register and for detailed information, visit www.nahb.org/designinstitute.

The NAHB Web site, www.nahb.org, gives you access to nearly 5,000 pages of housing industry information and exclusive members-only resources 24 hours a day, seven days a week. Access is fast, easy and free to NAHB members.

To take full advantage of the exclusive NAHB members-only resources on www.nahb.org, however, you must log in.

By logging onto the NAHB Web site, you will have access to twice as much information as non-members — information that will help you stay ahead of your competition.

You will be able to view and read entire sections of content developed just for members, and you will be able to personalize the site to your specific interests.

To learn more, log in and visit the "How to Use" www.nahb.org section in My NAHB.

For questions or help logging in, call 800-368-5242 x0; or e-mail your name, company name, state and phone number to login@nahb.org.

Education Calendar

Whether you’re new to the industry, hope to make your next career move or want to improve your company’s bottom line, The NAHB University of Housing can assist you in your educational pursuits.

Visit www.nahb.org/education for a comprehensive listing of courses throughout the country. Be sure to visit often in order to view the most up-to-date information in your area.

The Design Institute will be held June 5-7 at the Westin Charlotte, Charlotte, N.C.

To register and for detailed information, visit www.nahb.org/designinstitute

To take full advantage of the exclusive NAHB members-only resources on www.nahb.org, however, you must log in.

By logging onto the NAHB Web site, you will have access to twice as much information as non-members — information that will help you stay ahead of your competition.

You will be able to view and read entire sections of content developed just for members, and you will be able to personalize the site to your specific interests.

To learn more, log in and visit the "How to Use" www.nahb.org section in My NAHB.

For questions or help logging in, call 800-368-5242 x0; or e-mail your name, company name, state and phone number to login@nahb.org.

EPA Aims at Reducing Storm Water Permit Paperwork

Action by the Environmental Protection Agency to encourage regional offices to accept erosion and sediment control plans approved by local authorities instead of requiring duplicative permitting paperwork is a victory for the environment, builders and home buyers, who stand to benefit from associated cost savings, according to NAHB.

Following a meeting with NAHB members, the EPA last week contacted its regional offices and state agencies that administer its programs to encourage them to use the agency’s “local qualifying program” guidelines to reduce storm water permit paperwork for builders.

While in Washington to attend NAHB’s spring board of directors meeting, association members visited EPA Administrator Stephen Johnson to reiterate their long-standing request for regional EPA offices to use the detailed information on storm water management that builders and developers already supply to their cities, counties and local jurisdictions, rather than requiring duplicative forms and additional fees.

Depending on the size of the lot and the complexity of the project, builders spend up to $7,000 per home complying with the federal storm water permitting regulations.

“We are delighted that EPA agrees that encouraging the so-called local qualifying program would be a time and cost savings for both the agency and builders,” said NAHB President David Pressly. “We both have the same goal: to protect our nation’s waterways from construction site runoff. For years, NAHB has argued that there are more efficient ways to achieve that goal.”

NAHB must do its part as well, Pressly said. “I call on our state and local association leaders to contact their permitting authorities and tell them about this rule,” he said. “The additional time and effort needed to complete this duplicative paperwork can be eliminated, and it’s another way the industry can keep housing affordable.”

For more information, e-mail Calli Schmidt at NAHB, or call her at 800-368-5242 x8132.

‘Storm Water Permitting: A Guide for Builders and Developers’ Available at BuilderBooks.com

Corps Official Hears Wetlands Regulation Complaints

In a recent meeting with George Dunlap, the Army’s deputy assistant secretary, members of the NAHB Environmental Issues Committee and other builders and developers received a better understanding of the U.S. Army Corps of Engineers and its wetlands permitting program.

Dunlap outlined the three goals that President Bush has directed the Corps to implement during his administration: defining the jurisdictional reach of the Clean Water Act; refining the permitting process to make it predictable, consistent and reliable; and taking a more science-based approach to decisions on mitigation as a condition of receiving a permit.

When NAHB members presented specific examples of the Corps’ overreaching, Dunlap said there is not much he can do. Congress must change the law to make the process clearer, he said. In the meantime, the Corps is trying to avoid making interpretations on the breadth of its jurisdiction and not taking sides so it can stay out of lawsuits.

“I can’t change the law,” Dunlap said, “Or we will invite judges to take over. We must protect this industry from judicial interference.”

Hoping for relief from what one Florida developer called “a shameful way to treat an American citizen,” members came armed with detailed examples of missed deadlines, painfully slow permit approval processes and even “regulatory blackmail” from local Corps officials asserting jurisdictional authority where none exists.

An Ohio builder brought documents detailing problems such as three- to nine-month waits for reviews to be scheduled, Corps workers cancelling inspections because they have run out of money in their travel budgets and other customer service issues.

The Corps does not have enough employees to adequately address the permit applications it receives each year, although it did process 80,000 permits in 2005, Dunlap said. A $40 million budget increase over the last five years is helping, but also must pay for advanced information technology tools in addition to more personnel, he said.

The Corps is also working on ways to encourage consistency among its 38 districts, which Dunlap said are very decentralized. Builders said they would like to know that if a particular water feature is not considered to be under the Corps’ purview in one district, it won’t be in any district. Similarly, they want certainty that what they are being required to do in exchange for a permit is similar to what others with similar projects are required to provide.

But at this point, that’s asking too much, Corps officials acknowledge. Right now, the Corps’ first step is to get all the engineers within each district to agree on the same jurisdictional interpretation. Officials are gathering charts, photos, plans and other documents to create a user manual for the Corps employees so they have examples to which they can refer.

Dunlap also said that builders need to keep a closer eye on engineering consultants and insist that the data they present with any permit applications is complete — but agreed with one builder that waiting eight months to hear that the permit is incomplete is too long.

A Georgia builder said that in his district, the Corps says the burden of proof is on the landowner to determine that the Corps should not have jurisdiction under the Clean Water Act. In fact, it should be the opposite, agreed Dunlap: the Corps has the burden of proof to claim jurisdiction. Dunlap and Chip Smith, assistant for environmental and regulatory affairs, suggested that the builder contact their office with details.

Smith also told builders to expect a draft of proposed changes to the Nationwide Permit, the current version of which expires next year. Nationwide permits are important tools for property owners who plan to complete projects that only have minimal impacts on the environment. So far, 30% of the excessive wording and redundancies have been eliminated from the permits to make them clearer and easier to follow, he said, and he looks forward to getting additional comments when the draft is published later this year.

When the draft is published, NAHB will offer industry opinions during the 60-day comment period.

For more information, e-mail Gary Suskauer at NAHB, or call him at 800-368-5242 x8327.

Big Changes Underway for Home Energy Rating System

Dramatic changes in the Home Energy Rating System (HERS), which is used to measure a home’s energy efficiency, are now underway and will be completely phased in by the start of next year, according to the NAHB Research Center.

Although sure to add some confusion initially and to create some challenges for builders marketing the index to potential customers, the new system is intended to bring the ratings into line with the most recent energy code and to include lighting, appliances and on-site energy production into the HERS rating, the Research Center says.

The new HERS systems turns the old ratings — where 100, on a scale of one to 100 indicated the best possible score — virtually upside down.

The new HERS index is based on the 2004 International Energy Conservation Code, with a home built to code receiving a score of 100. For every 1% reduction in annual energy consumption, the HERS index is lowered by one point. Under this system, a zero-energy home would score a “0” and a house using twice as much energy as the “code” home would have a HERS index of 200.

Under the old system, a score of 86 or higher was needed to obtain the Energy Star® label. Under the new HERS index, to meet Energy Star® requirements, a home in a cold climate needs a HERS index no higher than 80 (20% more efficient than the reference home). In moderate or hot climates, an index no higher than 85 is required.

	HERS Index	HERS Score
Reference code/standard	2004 International Energy Conservation Code	1993 Model Energy Code
Total Energy Consumption in the rating system	• Heating • Cooling • Water heater • Lighting • Appliances • Onsite energy production • Plug loads	• Heating • Cooling • Water heater
Comparison to the "code" home	For every 1% reduction in total energy consumption, -1 point.	For every 5% reduction in total energy consumption, +1 point.
"Code" home score	100	80
Zero energy home score	0	100
EnergyStar® home	Climate zone 6-8: < =80 Climate zone 1-5: < =85	> =86
Completely phased in	Jan. 1, 2007

The previous HERS score included only heating, cooling and water heating, and was based on comparison with the 1993 Model Energy Code. Under the old system, a home that met the energy code requirements but included high-efficiency lighting and appliances had the same rating as a code-compliant home with standard-efficiency lighting and appliances.

The Research Center points out that many of its EnergyValue Housing Award (EVHA)-winning builders rate every home they build.

Arkansas home builder Stitt Energy Systems tests the tightness of the house twice, once before drywall is installed and again upon completion of the home. The pre-drywall testing allows the builder to identify any problems before they are enclosed behind drywall.

Don Ferrier, president of Ferrier Builders, says that getting a HERS test is one of the best things his company does to ensure quality control.

Some EVHA-winning builders have in-house raters, according to the Research Center, while others subcontract the work. Having an in-house rater requires some upfront investment in equipment, software and training, but may be cost-effective in the long run.

The cost of a HERS rating varies widely based on economy of scale, local market conditions, travel distance for the rater and other factors. The national average is about $450, and some production builders pay less than $200 per home.

Star ratings may be somewhat helpful for builders promoting the energy-efficiency of their homes, the Research Center says. The best homes — those scoring 50 or less — receive a five-star-plus rating. However, there may still be some confusion because under the star ratings, even a home with an index of 400 or 500 — one that uses four to five times the energy of the reference home — receives one star.

The new HERS index for meeting Energy Star® requirements will apply to homes permitted after July 1 and be completely phased in by next January.

Local HERS raters are probably the best source of information about the new ratings.

For detailed information from the 2006 Mortgage Industry National Home Energy Rating Systems Standards, click here.

For more information about the EnergyValue Housing Award or to obtain a 2007 EVHA application, click here.

High Court Clean Water Act Ruling Puts EPA on Thin Ice

A unanimous Supreme Court ruling last week that water passing through a dam is subject to state regulation under the Clean Water Act drew praise from environmentalists and NAHB alike.

In S.D. Warren Co. v. the Maine Board of Environmental Protection, the justices reasoned that even if water flowing through a dam is not in itself a pollutant, the temperature of the water has been changed by the dam, with repercussions for fish and plants.

In reaching its decision, the court touched upon issues that are pertinent to NAHB efforts to attain clarity and consistency in federal regulations on storm water and wetlands permits at a time when the U.S. Environmental Protection Agency has been attempting to exceed its authority under the Clean Water Act, according to Duane Desiderio, the association’s staff vice president for legal affairs. And the decision, he said, “confirms that NAHB has been on the right path all along, and that the EPA is skating on thin ice.”

Of importance to builders, he said, is the court’s discussion of the meaning of the word “discharge” in Sections 401, 402 and 404 of the Clean Water Act.

Whenever there is a potential for a discharge into navigable U.S. waters from development for which any federal permit is needed, then Section 401 requires the developer to obtain a water quality certification from the appropriate state agency. However, said Desiderio, the court also made it very clear that that the potential for a discharge alone does not require a permit under Section 402, which applies to storm water, and Section 404, which covers wetlands.

Under Section 402, the court said that the “triggering statutory term…is not the word ‘discharge’ alone, but ‘discharge of a pollutant,’ a phrase made narrower by its specific definition requiring an ‘addition’ of a pollutant to the water.” That means, Desiderio said, that the EPA and other federal agencies cannot require a permit simply because there is the potential for the addition of dirt, sediment or other pollutants to navigable waters.

The decision in the S.D. Warren case, he said, seems to support NAHB’s contention that builders don’t need a permit as long as the dirt remains onsite.

As for Section 404, “It has been NAHB’s position that if a developer is moving soil around in a wetland but is not actually adding any sediment to that property, no permit should be necessary,” Desiderio said. “That was the basis of the Tulloch argument back in the late 1990s. The court confirmed that position.”

The Supreme Court is now getting ready to consider two lawsuits — Rapanos and Carabell — that should provide additional clarification on the Clean Water Act, specifically on what constitutes “navigable water” as opposed to a “point source.” Regulatory agencies have tended to overstep their bounds in interpreting that distinction as well, Desiderio said.

“NAHB continues to play an advocacy role for tomorrow’s home owners,” he said. “Overreaching regulations have not made our country cleaner or environmentally safer, but their cumulative effect has distressing ramifications for affordability. The Supreme Court’s decision backs up our efforts, and we applaud it.”

For more information, e-mail Tom Ward at NAHB, or call him at 800-368-5242 x8230.

Red Cross Prepares Floridians for Hurricanes

To help Floridians prepare for hurricanes and other disasters, Florida’s American Red Cross chapters are recognizing the “Twelve Days of Hurricane Season” on May 21 through June 1, when individuals and families can purchase certain disaster preparedness supplies without paying sales tax on them.

Enterprise Supports 6,500 New Orleans-Area Homes

Enterprise Community Partners announced on May 16 that it will be working closely with local partners to support the development of approximately 6,500 affordable single-family homes and apartments in the New Orleans metropolitan area.

With technical support and an investment of more than $20 million from Enterprise, Providence Community Housing, a new nonprofit housing development corporation sponsored by Catholic Charities, Christopher Homes Inc. and several other community-based organizations, is leading the development effort, with a focus on seniors, working families and those with special needs.

Enterprise is also finalizing partnerships with local organizations throughout the Gulf Coast region that are expected to result in more than 15,000 homes, said Bart Harvey, the organization’s chairman and CEO. “This type of work is consistent with our mission to create fit and affordable housing for low-income Americans and help them move up and out of poverty into the economic mainstream,” he said.

Enterprise and Providence are working with Fannie Mae to provide financing to build and renovate this affordable housing.

NAHB, Fannie Mae Announce Safety Award for Excellence

A new awards program — Safety Award For Excellence (SAFE) — will recognize home builders who develop outstanding work-site safety programs. Fannie Mae is sponsoring the award in support of NAHB's efforts to promote the use of best practices in the housing industry.

“This new national awards program has been established to recognize the achievements of builders and trade contractors who excel at safety performance and have developed and implemented high-quality construction safety programs,” said NAHB President David Pressly. “NAHB is a national leader in construction safety, and this award emphasizes our commitment to a safe work environment.”

SAFE will also honor those government officials and NAHB-affiliated associations who have made unique and important contributions in advancing safety in the home building industry.

The SAFE program is open to all NAHB member companies that are in good standing and build residential homes or town homes using light construction methods, as well as NAHB-affiliated associations, and federal or state plan OSHA officials who have been nominated by an NAHB member or association that is in good standing. Awards will be made in a variety of residential construction categories.

“The SAFE program will closely examine each candidate’s commitment to construction safety and health in the home building industry,” said Vernon Pottenger, chair of NAHB’s Construction Safety and Health Committee and a builder from Beaufort, S.C. “We believe this award will foster a culture of injury prevention in the home building industry and promote safe working conditions.”

Award winners will be recognized during the 2007 International Builders’ Show in Orlando, Fla. Winners will receive an engraved award, as well as coverage in Nation’s Building News Online.

For more information, go to www.nahb.org/SAFE; or e-mail Rob Matuga at NAHB, or call him at 800-368-5242 x8507.

The “Jobsite Safety Video,” available through BuilderBooks.com, provides an overview of the key safety issues residential builders and workers need to focus on to reduce accidents and injuries. Based on the “NAHB-OSHA Jobsite Safety Handbook,” this DVD is intended to be used as part of an essential residential construction safety-training program and includes two 20-minute videos.

HBI Helps Youthbuild Grads Start Construction Careers

Five young graduates celebrated a new chapter in their lives as members of the residential construction workforce on May 2 in the first student commencement ceremony for the Home Builders Institute's (HBI) Youthbuild program in Montross, Va.

Youthbuild, a Department of Housing and Urban Development (HUD) program, provides economically disadvantaged young adults opportunities to obtain education, employment skills and on-site work experience.

The Montross program, operated by Employment Resources Inc. (ERI), is the first to receive technical assistance from HBI under the institute’s partnership with Youthbuild.

Of the five graduates, four are already working in residential construction. Kevin Turner, 18 and Charles Jones, 21, earn $10 an hour as carpenter helpers with Consumer Building Services (CBS) Inc. Moses Johnson, 22, and Douglas Henry, 23, are making $8 an hour as masonry helpers at CMB Masonry and Johnson Masonry, respectively.

Students were trained using HBI’s six-month Pre-Apprenticeship Certificate Training (PACT) curriculum, which helped them acquire fundamental trade skills and their GEDs. Other key components of the curriculum include work-readiness, entrepreneurship and mental-acuity training.

“Kevin and Charles came to our company with a great foundation of skills and they have continued to learn at a rapid pace,” said Bill Moyer, owner of CBS. “In my 30 years in the industry, I have never seen young people with their positive attitude and hunger for hands-on knowledge. Honestly, everyone at CBS is ecstatic to have them here.”

“It was great to see their growth process,” said ERI counselor Verlane Mack. “They really learned how to mesh their learning styles and work together as a team.”

Mack said that a trip to Gulfport, Miss. to participate in Katrina rebuilding efforts by repairing damaged roofs and installing drywall was a catalyst for the young trainees. “All our students were humbled by what they saw when we arrived, and were appreciative of the opportunity to help and proud that they could put their skills to use,” added Mack.

For more information on HBI’s technical assistance efforts in Youthbuild, e-mail Steve Cousins at HBI, or call him at 800-795-7955 x8939.

Superintendent Course Premiering at Concrete Technologies Tour

Home Builders Institute (HBI), the workforce development arm of NAHB, recently partnered with NAHB’s Concrete Home Building Council (CHBC) to create a Concrete Specialization curriculum geared to field superintendents.

The four courses developed for the curriculum are scheduled to be launched nationwide this summer. The four-hour “Concrete Mix Designs, Construction Guidelines and Troubleshooting” will be featured at the CHBC-sponsored 2006 Concrete Technologies Tour, June 11-13 in Phoenix.

HBI and council modeled the courses after HBI’s Residential Construction Superintendent (RCS) Designation curriculum, which emphasizes topics identified by NAHB members as important to a field supervisory position.

For more information on HBI’s course offerings, e-mail Joseph Krinock, or call him at 800-295-7955 x8928.

Recent Home Buyers Spend More on Home Improvements

A new study by the Home Improvement Research Institute (HIRI) found that 66% of new home owners undertake at least one improvement project on their home and almost half of existing home owners do a project to ready it for sale, with home projects on average costing $2,576.

Headquartered in Tampa, Fla., HIRI is one of the nation’s foremost authorities on trends and economic forecasting for the home improvement industry. Among those who study research from the institute and others to keep in touch with changing consumer wants and needs are members of the National Council of the Housing Industry — The Supplier 100 of NAHB.

Based on a survey in March of 600 new home buyers and 600 purchasers of existing homes, findings of the proprietary study were released earlier this month at the National Hardware Show in Las Vegas.

Information from the study is used by manufacturers, retailers, wholesales and allied organizations in the home improvement industry to make decisions about their businesses.

This feature is solely for educational and informational purposes. Nothing on this page should be construed as policy, an endorsement, warranty or guaranty by the National Association of Home Builders of the featured product or the product manufacturer. The National Association of Home Builders expressly disclaims any responsibility for any damages arising from the use, application or reliance on any information contained on this page.

NAHB-Produced Programs on HGTV & DIY This Week

The NAHB Production Group produces four weekly television shows on HGTV and DIY for consumers. The following is this week's lineup:

The NAHB Production Group is a full-service, self-contained, media production unit creating programming for cable television, broadcast television, non-profit, museum and corporate clients. Productions range from magazine format shows for general audiences to museum-installation videos for specialized use.

The production group includes award winning journalists, writers and photographers with experience in broadcast, documentary and corporate television.

Explore the latest housing industry news and information on www.nahb.org — the official public and members-only Web site of NAHB.

New Grant Funds Hispanic College Student Internships

The National Housing Endowment, the philanthropic arm of NAHB, is supporting a Home Builders Institute program — TEAM BUILDERS ― that introduces high-achieving Hispanic college students to the residential construction industry through summer internships with NAHB members.

The aim of TEAM BUILDERS is to encourage high-caliber candidates to join the management ranks of the nation’s home builders and supplier companies, positions for which there is expected to be unprecedented need in the next 15 years.

Twenty-five students are expected to intern with the pilot program sponsor, Beazer Homes, in offices across the country.

The endowment’s funding will support scholarships for the first class of TEAM BUILDER students to attend the International Builders' Show in February 2007. The scholarships will cover travel expenses, room, board and some administrative costs.

Funding for this grant was made possible through the support of Patsy Smith, endowment trustee and the 2005 HBI chairman, from the Herman and Patsy Smith Home Builders Institute Fund. Smith created the fund in 1999 in memory of her late husband as part of her seven-figure gift to the endowment to support initiatives at the Home Builders Institute. An additional contribution will be made from the endowment’s unrestricted fund.

“The TEAM BUILDERS program is exactly what I created this fund to accomplish — to bring new people into this industry and support worker training initiatives,” said Smith. “Herman would have been very proud to be part of such an effort, and I hope this program continues for years to come.”

“The National Housing Endowment is embarking on an effort to increase the number of individuals entering residential construction management,” said Gary Garczynski, endowment chairman and 2002 NAHB president. “This program addresses this need in a profound way and the endowment is excited to play a part in its success.”

For more information, e-mail Page Browning, director for academic services at HBI, or call her at 800-368-5242 x8918.

Thirteen Percent of Latino-Owned Businesses Are in Construction

The largest share of Latino-owned businesses operate in the service industries (42%), followed by construction and retail (13% each).

Data extracted from: U.S. Census Bureau, 1997 Economic Census, Survey of Minority-Owned Business Enterprises

— Latin Business Association (2002)

Avoid Credit Card Processing Rate Increases With Solveras

Solveras Payment Systems, the newest Member Advantage company, offers members and home builders associations the chance to avoid the Visa® and MasterCard® processing rate increase that the credit card company recently announced.

Solveras Payment Systems has negotiated a special deal for NAHB members that will allow you to avoid upcoming increases by Visa® and MasterCard® if you contact Solveras no later than Wednesday, May 31 and lock in pre-increase processing.

If you accept credit cards and don’t contact Solveras, these increases could significantly impact your bottom line.

Add that to the Solveras’ regular discounts on credit card processing, simplified monthly billing and an easy-to-read account statement, and you’ll find an excellent opportunity to keep more profit on every credit card sale.

For more information, e-mail Tiffany Smith at NAHB, or call her at 800-368-5242 x8273.

For the most up-to-date details on the Member Advantage discount program and all of the participating companies, go to www.nahb.org/MA.

Explore the latest housing industry news and information on www.nahb.org — the official public and members-only Web site of NAHB.

GM $500 Exclusive Offer for NAHB Members

During 2006, qualifying NAHB members are eligible for a
$500 offer on most GM vehicles.

Throughout 2006, qualifying NAHB members are eligible for a $500 exclusive offer on most GM passenger cars, light-duty trucks, vans and SUVs.

GM NAHB Affinity Cards and details on this offer were mailed directly to NAHB members from GM, and members should use the affinity card when purchasing a qualifying vehicle.

Members who have misplaced or otherwise do not have a GM NAHB Affinity Card may print out their own replacement cards in order to show member verification to a GM dealer. Note: Members must be logged in to www.nahb.org in order to print their replacement card.

Members with a www.nahb.org login should go to www.nahb.org/MA and click on the “GM Exclusive Offer.” This will take members to a Web page with program details and instructions for printing a replacement card.

There are also instructions for members who do not have a login (they will be sent to www.nahb.com/loginGM and returned to the page to get a replacement card).

For more information, e-mail Tiffany Smith at NAHB, or call her at 800-368-5242 x8273.

For the most up-to-date details on the Member Advantage discount program and all of the participating companies, go to www.nahb.org/MA.

Explore the latest housing industry news and information on www.nahb.org — the official public and members-only Web site of NAHB.

Find Employees Through New NAHB Online Career Center

NAHB is hosting an online building industry-oriented career center that provides members with a cost-effective recruiting solution that makes locating qualified candidates and advertising open positions faster and easier.

NAHB members using the NAHB Career Center will receive a 20% discount off of standard rates for job postings. For a complete listing of all rates, click here.

The career center was created in collaboration with ConstructionJobs.com, a leading employment resource for the construction, design and building industries.

Nation’s Building News readers can visit the site by using the NAHB Career Center tab at the bottom of the issue’s headlines, or by going to the NAHB Web site or www.nahb.org/careers.

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To take full advantage of the exclusive NAHB members-only resources on www.nahb.org, however, you must log in.

By logging onto the NAHB Web site, you will have access to twice as much information as non-members — information that will help you stay ahead of your competition.

You will be able to view and read entire sections of content developed just for members, and you will be able to personalize the site to your specific interests.

To learn more, log in and visit the "How to Use" www.nahb.org section in My NAHB.

For questions or help logging in, call 800-368-5242 x0; or e-mail your name, company name, state and phone number to login@nahb.org.

Nation's Building News Online: May 22, 2006

Record Number of Builders Carry Concerns to Capitol Hill

Share Nation's Building News With Your Company's Employees

The Race Is On for National Membership Day

Builders Face Higher Copper Costs, Drywall Shortages

Housing Cool-Down Is ‘Orderly,’ Fed Chief Says

Why Perth Is Booming

When Mom (or Dad) Moves In

‘Skinny Streets’ Movement Winning Wider Acceptance

The ‘Mini-Me’ Structure Is the Latest Addition to the High-End Lifestyle

Harmonic Emergence

Lawmakers Just Say ‘No’ to Anti-Housing Tax Proposals

New Tax Law Contains Provisions of Interest to Builders

Senate Majority Whip Wants to Abolish Estate Tax

NAHB Members Urged to Ask Senators to Support S. 2611

Bush Immigration Reforms Supported by Builders

Election Web Site Aimed at ‘Building the Vote’

Housing Starts Dip 7.4 Percent in April

Builder Expectations Reflect Slowing Market

Housing Affordability Up Just a Notch in First Quarter

Pact Would Keep Lumber Prices High Even as Demand Softens

NAHB Board Salutes 18 Millionth VA Home Loan Recipient

First Construction-to-Permanent Loan Rural Home Built

Eye on the Economy: NAHB Still Forecasts a 6.1% Decline in Starts

Builder's Tip: Shop Vac Works for Hard-to-Fill Glue Ups

See Success With Biztools on Membership Day Webcast

Build Your Knowledge at the Custom Builder Symposium

Remodelers Report Moderate Growth in First Quarter

Home Remodeling Heads for Another Record Year

4-D Modeling: Is 'Virtual Building' In Your Future?

From Walls to Kitchen Counters, Concrete is Hot

Want to Know More About Designations? Ask an Expert

Education Calendar

EPA Aims at Reducing Storm Water Permit Paperwork

Corps Official Hears Wetlands Regulation Complaints

Big Changes Underway for Home Energy Rating System

High Court Clean Water Act Ruling Puts EPA on Thin Ice

Red Cross Prepares Floridians for Hurricanes

Enterprise Supports 6,500 New Orleans-Area Homes

NAHB, Fannie Mae Announce Safety Award for Excellence

HBI Helps Youthbuild Grads Start Construction Careers

Superintendent Course Premiering at Concrete Technologies Tour

Recent Home Buyers Spend More on Home Improvements

NAHB-Produced Programs on HGTV & DIY This Week

New Grant Funds Hispanic College Student Internships

Avoid Credit Card Processing Rate Increases With Solveras

GM $500 Exclusive Offer for NAHB Members

Find Employees Through New NAHB Online Career Center

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