Nation's Building News Online: December 11, 2006Print All Articles Text Version |
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Housing Fundamentals Remain Strong, Hovnanian SaysJob growth and household formations are well on track to support a turnaround in the housing industry, according to Ara Hovnanian, president and CEO of Hovnanian Enterprises. “Housing is driven by household creation,” Hovnanian told almost 200 New Jersey municipal officials and their advisors. “The demographics are solid. The United States population continues to grow.” Hovnanian’s remarks, and other materials from his company geared to alerting the public to some of the unique home buying opportunities available in the current marketplace, have been added to NAHB’s “It’s a Great Time to Buy” section that is available to members on the association’s Web site. With mortgage interest rates trending slightly down in recent weeks and remaining at affordable levels, and builders moving aggressively to reduce their inventories of unsold homes, the housing market has started showing some signs of stabilizing. Mortgage rates continued inching down for the sixth consecutive week, according to the results of Freddie Mac's Primary Mortgage Market Survey released last Thursday. Thirty-year, fixed-rate mortgages averaged 6.11% for the week ending Dec. 7, down from 6.14% during the prior week and from 6.32% one year earlier. "As a matter of fact, the 30-year FRM (fixed-rate mortgage) is very nearly the lowest it has been this year," said Frank Nothaft, Freddie Mac's chief economist. "The only other time the 30-year FRM has been lower was in January, when it fell to 6.10%," he said. "Looking forward in the housing market, we think that housing is about two-thirds of the way through the correction," Nothaft said, "and should stabilize by mid-year 2007." The latest indication that the market is slowly making its way back came last week from the Mortgage Bankers Association, whose Weekly Mortgage Applications survey, for the week ending Dec. 1, showed an 8.1% increase in mortgage loan application volume on a seasonally adjusted basis. In the meantime, as balance is restored in the housing marketplace, a process that is expected by NAHB Chief Economist David Seiders to persist into the middle of 2007, Hovnanian has been reminding its customers that conditions aren’t nearly as bad as they have been during previous housing downturns, largely because the nation’s economy remains relatively vibrant. Conditions Not So Bleak George Economy, a sales consultant for the company at Four Seasons at South Knolls, said he remembers another time when customers weren’t beating down the doors. “I sat in 1990 in a trailer and no one came in for months,” he recalls. “No one. No one called. No one came in.” Things aren’t nearly as bleak as they are depicted these days in the media, he says, and with a growing economy customers are still coming in, but it’s hard to create a sense of urgency. More important to many of his active adult customers, he says, is their ability to sell their current home, so keeping them interested until the marketplace regains its forward momentum is the name of the game. “I plant seeds,” he says. “I see myself as a farmer. There are very few people who buy the first time. I have to get them to love the community, be enthusiastic about the product. You do that by spending time with them. It’s a process. It may take three or four times, but it works.” “You have to sell yourself before you sell the company,” he adds. “How they view me is how they view the company. Being sincere and making them feel that they are the most important people in the office at this time creates credibility and confidence. They must feel that I am here for them, which I am.” In the end, says Economy, what still works best are the practices that have brought him success since he entered the business in 1983. “I sell the same way I always have,” he says. “We might have to sit like this for a while. There’s no easy pill.” In its marketing literature, Hovnanian concedes that the current climate probably isn’t right for investors looking to make a quick profit, “but people looking to invest in a home for the future of their family and community will find the weather just fine." Among the reasons Hovnanian is advising families that they should be exploring what’s available in today’s housing market despite stories of gloom and doom in the press:
To read all of the Hovnanian materials, NAHB members can click here. To access “It’s a Great Time to Buy,” click here. Additional resources are available to consumers at www.nahb.org/timetobuy. For more information, e-mail Niki Clark at NAHB, or call her at 800-368-5242 x8061.
Want to Know the Housing Starts Through 2015? Find out in HousingEconomics.com’s Long-Term Forecast. HousingEconomics.com includes downloadable Excel tables featuring the housing starts forecast, GDP, demographics and more. To learn more, visit www.housingeconomics.com. Floor Plans: Art Deco Meets Asian Symmetry in Miami’s South BeachDeveloper:
Set amid the royal palms of Miami’s South Beach, The Setai Resort and Residences blends Art Deco and sundecks with tropical gardens, sparkling pools and Asian symmetry. No yin and yang here, though. The Setai Residences, a 40-story ultra-luxury, high-rise condominium tower, shares space, compatibility, panoramic views and East-West design cues with The Setai’s meticulously replicated, eight-story hotel and 125 guestrooms.
The Setai has been designed to create a tranquil Asian mood. Outside, the Setai, which is in the heart of South Beach’s historic district, is pure Tropical Deco — Art Deco details and characteristics finished in a soft, ice cream-colored exterior. To create the resort, The Setai Group originally planned to renovate the 1930s-era Dempsey Vanderbilt Hotel, the centerpiece of the resort. But the hotel was beyond repair. So, after consulting with the Historic Preservation Board of Miami Beach, the hotel was demolished and a replica was built in its place. Adjacent to the hotel is the 40-story Setai residences tower with its 163 condominium units, one of the tallest structures of the Miami Beach skyline. It features floor-to-ceiling glass in each condominium to take full advantage of the views and the same Tropical Deco colors and details as the hotel.
Inside the Setai, the design cues blend Shanghai’s Art Deco period — incorporating Shanghai brick, bronze, teak, imported stone and Asian art and artifacts — and Zen. The Setai Residences — Luxuriating in Detail The Setai offers one-, two- and three-bedroom condominiums, two-story townhouses, plus a 10,000-square-foot penthouse with a private rooftop pool. The tower suites also feature individual stainless steel private pools, full terraces and private sunbathing areas.
The 40-story tower sits atop a 10-story podium that accommodates the lobby and mechanical spaces. Amenities for all the residences include a pond courtyard that serves as the lounge and an open-air restaurant, and an oriental spa facing the ocean.
A limited number of condo-hotel suites are also available for sale. These rooms average 600 square feet and feature teak flooring, built-in teak cabinetry, cast terrazzo soaking tubs and separate showers with rainfall heads, Bose sound systems, flat screen televisions and custom designed furnishings. The condo-hotel suites have been integrated into the Setai Hotel rental program.
The Setai Resort and Residences took top honors in the mixed-use category of NAHB’s Multifamily Housing Council 2006 Pillars of the Industry Awards honoring the best in multifamily development and design. The Setai was also named the Freddie Mac Multifamily Community of the Year.
Second and Urban Homes Not a Big Lure for Baby BoomersAlthough they may be healthier, wealthier and better educated than previous generations, aging baby boomers are no more likely to purchase second homes or move from the suburbs to an urban area than the retirement-age households that have preceded them, according to a recent study from the Research Institute for Housing America in conjunction with Radian and the Mortgage Bankers Association. Better news for those who have been eyeing these markets is that both segments will receive a boost based upon the sheer numbers of baby boomers who will be entering retirement age. Based on data from the Health and Retirement Study, which has been surveying older Americans since 1992 and included early baby boomers born between 1948 and 1953 in its latest study conducted in 2004, the report, “Housing Trends Among Baby Boomers,” concludes that suburban empty-nesters relocating to the city have all the makings of “a small market” and “it would seem that substantial growth in the urban homeownership rate by older households due to migration from the suburbs is unlikely.” “Also, if past experience is any guide,” the report says, “any increase in the second-home ownership rate likely will be modest.” The future increase in the size of those two markets and their associated mortgage markets, says Gary Engelhardt, an associate economics professor at the Center for Policy Research at Syracuse University, “will be driven by increasing numbers of older households as the population ages.” He cites projections from the Census Bureau that the share of the population that is 45 or older will rise from almost 35% in 2000 to 42% by 2050, primarily because of the baby boomers. Individuals who are 45 to 64 years-old are considered the prime market for second and urban retirement homes among older households, and they comprised 22% of the population in 2000. “Nationally, as older households comprise a greater population share, the number of second homes is forecast to rise to 7.5 million by the end of the decade, about 900,000 more second homes than in 2004,” writes Engelhardt. “Steady growth will continue until 2020, at which point the number of such homes is forecast to be just over 9 million. After 2020, the growth in the share of the population in the prime second-home owning years begins to slow, and, consequently, the number of second homes begins to level off.” Adding in the expectation that the homeownership rate in the general population will continue to increase over the next 10 years, projections by the chief economists for organizations in the Homeownership Alliance — which include NAHB, the National Association of Realtors®, the Independent Community Bankers of America, Fannie Mae and Freddie Mac — future second home growth is somewhat stronger, Engelhardt’s report points out. “Specifically, the national number of second homes is forecast to rise to 7.7 million by 2010, about 1.1 million more second homes than in 2004, and to 8.9 million by 2015. Overall, in the next 10 years, the number of second homes is forecast to grow by 2 million homes according to these projections.” Engelhardt also says that the demand for second homes may rely upon the viability of Social Security, Medicare and traditional employer-provided pension systems, as well as baby boomers being adequately prepared for retirement. The outlook here is not entirely clear and the outcome could hold unforeseen consequences, he warns. Among the findings of the study on the outlook for the ownership of second homes:
Building Homes of Our Own, NBN Earn National Honors
Two vital outreach programs from NAHB ― Building Homes of Our Own, the award-winning interactive teaching tool for students, teachers and parents; and Nation’s Building News, the most comprehensive weekly source for home building industry news in the country — have earned national honors from PRNews, the 61-year-old publication about the business impact of public relations. Both NAHB programs received top honors in their categories — “Interactive PR and Marketing” for Building Homes of Our Own, and “Membership Communications” for Nation’s Building New — during an awards ceremony held at the National Press Club in Washington, D.C. on Dec. 11. Open to any communications/marketing team at a nonprofit organization, association, government agency, NGO or educational institution, PR News’ Nonprofit Awards are judged by a blue-chip panel of communications consultants, educators and PR executives. They provide an annual benchmark for nonprofit communicators, who are often held to different standards than for-profit organizations. The Interactive PR and Marketing Category recognizes outstanding use of digital media to communicate a message, include a Web site-based marketing campaign, outstanding e-mail communications and other capitalization of digital media for PR/marketing. The Membership Communications Category salutes outstanding public relations efforts to an association’s membership year-round or for a particular campaign. For more information on the awards, visit www.prnewsonline.com/awards/nonprofit. Share Nation's Building News With Your Staff. It's Free.Make your business click. Subscribe your employees and trade partners to Nation's Building News — the free, online e-newspaper of NAHB. Each issue is filled with valuable news and information on every aspect of the home building industry — business and builders tips; the latest materials prices and mortgage interest rates; new technologies; cutting-edge design; state and federal regulations and how they affect the industy; and more. Information your entire company needs to stay ahead of your competitors. Forward this issue to your employees and trade partners and ask them to subscribe. Nation's Building News, it's free to them — invaluable to you. Don't delay, have your employees subscribe today. To subscribe, go to www.nahb.org/nbn. NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. As Prices Fall, U.S. Home Buyers Benefit“It’s absolutely getting better for buyers,” says Phil Hagedorn, who recently purchased a 1920s-era Southern bungalow in Atlanta’s Kirkwood neighborhood for $25,000 below the $325,000 it would have sold at six months ago and with the seller paying the closing costs. “By my math, when housing was extremely affordable in 1998, it was an important reason for the boom that followed,” says Richard DeKaser, the chief economist at National City, a bank holding company in Cleveland. “We’re coming off a relatively unaffordable time, and so we’re looking forward to a subdued housing market in the future.” To make houses more affordable, developers are agreeing to upgrade kitchens free, make the first year of mortgage payments and pay closing costs. Incentives and deals vary around the nation, says Michael Lerner, the president of MCZ/Centrum, a national builder based in Chicago. “In Sarasota, buyers are looking for the best price. In Miami, it’s upgrades to the kitchen and bathroom and help on the closing costs. In Phoenix, prices have been rolled back to 2002 levels to clear out inventory.” In the meantime, the market has turned quite difficult for people who bought homes to renovate and resell them. “You see a lot of houses where they do renovations that are the least expensive,” says Sara Jane Klingaman, part owner of Ten Fingers Unique Restoration in Atlanta. “They use builder-grade everything, and then they find out they can’t sell them because they’re not what people are looking for. So the houses sit and sit until the price drops enough that somebody’s willing to buy it despite the renovation.” (www.csmonitor.com)
Support for Any Theory — Latest Home Price Report Has Something for EveryoneThe third-quarter report on home prices by the Office of Federal Housing Enterprise Oversight shows real estate heating up, cooling down, headed for a deeper freeze or just hanging in there despite the challenges. In Bend, Ore., for example, house values appreciated at a stunning 30.4% during the 12 months ending Sept. 30, according to the study, which found several dozen hot spots across the country. While there is less hard evidence in the latest statistics of a deep-freeze scenario, there are some sobering trends underway in two categories of real estate markets: those areas where the regional economy has been struggling, such as pockets of the Midwest, and boom-era shooting stars where excess appreciation has burned itself out and prices are now flat at best, such as the markets of California. The most impressively documented scenario is that many large metro markets — including some that experienced high gains during the boom years — are still hanging in there and registering net appreciation, albeit at lower rates. Examples include Fort Lauderdale (a 10.3% annualized gain during the quarter) and Naples, Fla. (10.8%); metro Washington, D.C. (2.8%); New York City and its northern New Jersey suburbs (2.9%); Seattle (14.6%); Miami (14.7%); Chicago (5.2%); Orlando (6.5%); and San Antonio (9.9%). (www.washingtonpost.com)
Toll Brothers Profit Down 44 Percent — Area Housing Markets Appear To Be StabilizingToll Brothers on Dec. 5 reported a 44% drop in quarterly profit but predicted that the slumping U.S. housing market may have hit bottom, particularly in the Washington, D.C. region. The company attributed its results, in part, to a record 585 new buyers canceling the contracts they had signed. But Robert I. Toll, the company’s chairman and chief executive, suggested that the worst may be over. “Fifteen months into the current slowdown, we may be seeing a floor in some markets where deposits [on homes] and traffic, although erratic from week to week, seem to be dancing on the bottom or slightly above,” he said. Toll singled out the Washington market, saying that new home sales in northern Virginia “seem to have stabilized, although at levels much lower than those we have enjoyed over the past few years.” The market also appears to be stabilizing in suburban Maryland, where there are fewer speculative buyers than in other areas, Toll added. For the fiscal year, Toll Brothers said its earnings dropped 15% to $687.2 million, compared with a record $806.1 million in 2005. Looking ahead, it said its 2007 earnings may fall as low as $260 million, although “projecting revenues and earnings results is difficult in the current environment.” (www.washingtonpost.com)
Where Is the Economy Headed?The U.S. economy keeps showing strength and weakness, and the conflicting data could be a sign that a mild growth slowdown is about to give way to a harsher downturn, or that the worst news is still coming from businesses involved in housing and automobile production while the rest of the economy is holding up. “No question, housing is in a recession,” said Nariman Behravesh, chief economist for Global Insight, an economic research and forecasting firm. “The big question, and where people part ways, is how much effect is this going to have on consumer spending and business spending?...Yes, there are scary parts of the economy, but there are other parts that are doing okay.” Federal Reserve Chairman Ben. S. Bernanke said recently that he foresees moderate economic growth over the next year. “I don’t think there is going to be a recession next year,” Behravesh said, noting that housing is enough to slow growth significantly but not stop it. On the contrary, he said, consumers are spending more because of low 4.4% unemployment, decent income growth, rising stock wealth and lower fuel prices. And businesses are exporting more goods to faster-growing economies oversees. (www.washingtonpost.com)
Town Can Use Eminent Domain for Open Space Protection, Court SaysThe New Jersey Supreme Court held on Dec. 7 that a municipality in the state did not abuse its eminent domain power by condemning 16 acres that had just received final subdivision approval for the construction of homes. Whether the town acted out of a desire to limit development was irrelevant, the court wrote, because that “was not inconsistent with the motive driving the public interest in open space acquisition generally.” Only when MiPro Homes bought the land to build housing, for which the property was zoned, did the town try to acquire the property. Richard Van Osten, executive vice president of the Builders League of South Jersey, said that the decision “strips your right to own your own property.” Labeling it a property rights issue rather than an open space or environmental one, he said that “there is no ability of private parties to rely on the planning laws and statutes in place in New Jersey." The New Jersey Builders Association and NAHB also supported the builder, and MiPro Homes’ lawyer says he will advise his client to petition the U.S. Supreme Court to review the decision. (www.law.com/nj)
The Apartment Atop the Garage Is Back in VogueTo enable people who would otherwise be priced out of the housing market to live close to their jobs and relatives, hundreds of communities across the country have rewritten their zoning rules in recent years to eliminate longtime bans on apartments in single-family houses and encourage new ones to be built. Once fairly common in large houses but prohibited by zoning ordinances after World War II, accessory apartments in places like garages or attics are now seen as one way to expand the supply of moderately priced rentals. They are intended for older people on fixed incomes, young people starting out and workers needed for essential but relatively low-paying jobs. “The reality is we desperately need the housing in most of the places where people are talking about this,” said Joel Russell, a land use lawyer and planning consultant in Northampton, Mass. “This is the least intrusive way to try to provide it; and the impacts that people are afraid will happen simply don’t happen in most places.” Illegal accessory apartments, unregulated and sometimes unsafe, are believed to be widespread. A 2000 report by AARP, which wants them legalized and encouraged, estimated that 65,000 to 300,000 illegal ones were being created each year. (www.nytimes.com)
New Kitchen Lifestyles Explored at Builders’ ShowWant to build the perfect house? Start with the kitchen. It’s the center of home life, and if you get it right, everything else falls into place, says designer Mary Jo Camp. Camp is one of three speakers for the “Lifestyle Kitchens: Designs, Materials and Techniques That Guarantee Great Kitchens” seminar at the International Builders’ Show, which will be held on Feb. 7-10 in Orlando, Fla. Sponsored by NAHB, the annual convention and trade show is expected to again attract more than 100,000 home builders, architects, developers and other members of the housing industry to four days of education, exhibits and special events. Camp’s seminar is one of 34 scheduled for the Architecture and Interior Design track, one of 18 areas of study scheduled for the show. Some of the other tracks include Trends and Forecasting, Housing Finance and Green Building. “This is the fun stuff,” said Camp, a 29-year industry veteran. “The three of us know that kitchens sell homes, and we want to help builders differentiate themselves in the marketplace.” A big trend right now: Clients want to incorporate more light into their kitchens, and they want bright, airy and well-ventilated space in a room they use not only for cooking and eating, but also for craft projects, homework, family gatherings and entertaining. The answer to that is incorporating green-building techniques such as “daylighting,” which entails positioning windows to best take advantage of outside light. Morning light is especially important in kitchens, Camp said. While kitchens have long been the hub of the house, their importance has grown as families have gotten busier. The kitchen is a center of activity, but it’s also a place to get rid of stress, relax and recharge — literally. Charging stations for mobile phones, portable stereos and laptops are an important component in new kitchens, Camp said. “Plus, you’ll know where to find them all,” she added. “People have a lot of stress and they come back home to alleviate that stress. We are entertaining people at home instead of being out in the hustle and bustle of a restaurant or club. We have such busy lives that cooking in the kitchen is a time to have conversation and family time,” she said. “The kitchen really is the life of the home; it’s interesting to see what the world throws at us and how we come home and talk about it in the kitchen.” Also on tap in the Architecture and Interior Design track are seminars on universal design, regional design and trends in “green” development. The 2007 International Builders’ Show is not open to the general public. Building industry professionals and their affiliates throughout the housing trades are welcome to register by visiting the show’s newly redesigned Web site at www.buildersshow.com. Discounted online registration and hotel reservation assistance are available through Jan. 5, 2007; onsite registration begins Feb. 4. Visitors can preview the show at www.BuildersShow.com/VTS, a virtual showcase for exhibitors and their products. In Virginia, A Workforce Housing Initiative That WorksWhen a police officer cannot live in the community he protects, when a teacher must travel an hour each way to school or when a firefighter has to rent and never own a home, there’s a problem. These are also the signs of a workforce-housing crisis, and the Hampton Roads region is among those in the state that have one. There is a way to overcome this problem, but it takes government officials who are willing to act. Since Virginia passed an Affordable Dwelling Unit (ADU) law in the late 1990s, local governments have actually had the power to enact workforce housing programs, but few, if any, have. Why the lack of progress? It appears that most business and civic leaders have been unable to make the law work for everyone’s benefit. Further, there are a number of myths surrounding workforce housing that are slowing acceptance. For instance:
Storm Water Reform Bill Would Cut Housing CostsWith duplicative and burdensome storm water regulations pushing up the cost of housing by as much as $4,500 a lot, the nation’s home builders last week applauded Sens. James Inhofe (R-Okla.) and Thomas Carper (D-Del.) for introducing bipartisan legislation that would protect the environment without needlessly driving up housing costs. “As the 109th Congress draws to a close, Senators Inhofe and Carper should be commended for making it a priority to craft legislation that takes into account the differences between residential construction activity and other industries,” said NAHB President David Pressly. “This measure would update and improve Environmental Protection Agency storm water permit and enforcement policies that have needlessly harmed housing affordability.” Current storm water permit and enforcement policies, which can add anywhere from $1,400 to $4,500 to the cost of every lot while doing little to improve water quality, are unduly increasing housing costs and pricing a growing number of families out of the market for homeownership. “By taking a more balanced and reasonable approach to storm water management and enforcement, S. 4101, the ‘Stormwater Enforcement and Permitting Act,’ would simplify compliance and offer a more consistent and sensible regulatory approach that provides better protection for America’s rivers and streams,” said Pressly. “This measure, along with House companion bill H.R. 5558, will serve as an excellent starting point for the 110th Congress to address this important issue when it convenes next month.” To read the legislation, click here and enter the bill number 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. Real Estate Provisions in Last-Minute Tax BillIn one of the last acts of the 109th Congress, lawmakers in the wee hours of Dec. 9 passed a major tax and trade bill that includes several expired tax provisions that have languished for nearly a year. The measure would also normalize trade relations with Vietnam and extend through 2008 duty-free access to the U.S. to more than 100 developing nations. The major tax portion of the bill includes extensions of the research and development tax credit through 2007, and a two-year renewal of the deduction for state and local taxes and higher education tuition expenses. The bill also contains several real estate-related provisions. Items of importance to home builders include:
NAHB lobbied against this provision, noting that inclusionary zoning policies are not an effective way to address a community’s housing affordability problem and that any solution to address this issue must come locally, not from a federal mandate. In a significant victory for NAHB, the mandatory exclusionary zoning requirements were stripped from the final bill. For more information, e-mail Greg Brown at NAHB or call him at 1-800-368-5242 x8421. Useful Links to Monitor Economic and Housing TrendsThe following are links to useful information from government agencies and NAHB that will enable you to monitor the housing market. To access the latest information available, simply click the links.
Want to Know the Housing Starts Through 2015? Find out in HousingEconomics.com’s Long-Term Forecast. HousingEconomics.com includes downloadable Excel tables featuring the housing starts forecast, GDP, demographics and more. To learn more, visit www.housingeconomics.com.
NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. Demand for Housing Near Mass Transit on the RiseHousing development centered on rail commuter lines will be growing in popularity in coming decades and represents an opportunity to address the housing needs of low- and moderate-income households, according to a report released last month by the Center for Neighborhood Technology. “The renaissance of mass transit has coincided with a renaissance of communities and neighborhoods that are near transit stations,” the report says. “More and more residents want to not only use transit, they want to live near it as well.” Researchers for the report,“Preserving and Promoting Diverse Transit-Oriented Neighborhoods,” project that 16 million households will want to live near transit in 2030, compared to the 6 million that already lived in these locations in 2000. “To accommodate this demand, a substantial amount of housing will need to be constructed near transit,” the report says. “Affordable housing may not need to be created at each and every transit zone, but the amount of affordable housing opportunities near transit should be tracked at the transit zone, corridor and system-wide scales to ensure transit in each region is equally accessible to all income levels, given the affordable connectivity it provides to job opportunities.” The report sites statistics from the American Public Transportation Association showing that riders in the U.S. took more than 9.7 billion trips on public transportation systems in 2005 and that public transportation use has increased 25% since 1995. “There are 3,349 mass transit stations in the U.S. today,” the report says, “and regions from coast to coast are building or planning to build new rail systems or expand existing systems. More than 700 new stations are currently under development.” Driving the growth in transit use and transit oriented development (TOD) are increasingly expensive transportation costs, convenience and growing auto-related congestion and air pollution. The study finds that TOD can and does reduce transportation costs for households. “Few households are even aware that the amount they spend annually on car payments, insurance, gas, parking and car repairs is almost equal to their rent or mortgage payment,” it says. “Many people moving to distant suburbs for lower priced housing may not, in the end, save money or build as much wealth as expected because of the high transportation costs of living a long — and expensive — car-ride away from essential amenities like schools, grocery stores and jobs.” Forty-five percent of workers in transit zones walk, bike or take transit to work, compared to just 14% of workers in regions with transit, according to the report, and three-fourths of households living near transit own one auto or less. For transit agencies, TOD neighborhoods that have greater racial and income diversity deliver more riders “because minority and lower-income workers take transit at the highest rates.” A significant portion of future demand for housing near transit will come from low- to moderate-income households, the study says. “By 2030, more than one-half of the potential demand for housing near transit is likely to come from households that have incomes below the area median income, or approximately $50,000. Twenty percent of households with a potential demand for housing near transit will make less than $20,000 a year.” The report also finds that neighborhoods near transit provide housing to a greater share of the region’s lower-income households, with the number of households earning less than $35,000 10% higher in transit zones than in the regions where those zones are located. “The transit infrastructure generally helps households of lower means get where they need to go, while keeping their transportation costs down.” Only 35% of households in transit zones are home owners, compared to 61% for the larger transit regions. “In regions where congestion and housing prices are high or on the rise, employers are now emerging as advocates for transit investment because many find that high costs for housing paired with difficult and expensive commutes get in the way of attracting talented workers at affordable wages,” the study says. “Finally, given the likelihood of housing market swings, a diversified housing stock in any development helps moderate those swings and provides more stable investments for developers.” Builder's Tip: A Time Saver for Installing Closet Shelf Cleats
Tips & Techniques provided by Fine Homebuilding.
To request a reprint of this feature, e-mail Christina Glennon at Fine Homebuilding.
BuilderBooks.com Offers More Than 250 Books That Help You Build Your Business 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. To view these publications online, click here, or call 800-223-2665. Free NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar on the NAHB Web site. For assistance, call the NAHB Member Service Center at 800-368-5242. Stay on Top of Projects With Project Management SoftwareProject scheduling is about setting goals, establishing a plan for achieving them and communicating the goals and plan to a construction team so that the team can stay on top of the project from beginning to end. In construction management, the schedule should integrate with weekly reports, requests for proposals, requests for information, the budget and the scope of work. An array of software programs — from Microsoft Project to tools created specifically for the home building industry — can help builders create effective scheduling. Once the projects are scheduled, they then can be “stacked” on a chart, such as a Gantt chart, a sort of enhanced timeline. Scheduling this way shows the relationships between various tasks and other details — such as how long the various tasks are projected to take, who will perform the work and the “critical path” of essential tasks — and gives a clear picture of when tasks must be finished in order to successfully complete the project. A key benefit of project management is that the software enables users and project managers to view everything relevant to the project at once. It also enables managers to view and explore project specifics from a variety of perspectives. Specifically, the scheduling software and resultant charts enable managers to visualize:
NAHB Biztools™ Has Nearly 300 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 nearly 300 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 Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. Subscribe to NAHB’s Business of Building e/Source NAHB’s Business of Building e/Source is your monthly electronic guide to the hot issues and emerging trends in home building business management. You’ll find practical advice, tricks of the trade and sound business guidance — all delivered monthly, straight to your desktop, in a quick and easy-to-read format. Business of Building e/Source is available free to NAHB members and their employees. To subscribe, click here on the Members Only side of the NAHB Web site. Deliver Projects on Time With ‘Scheduling for Home Builders’
“Scheduling for Home Builders with Microsoft® Project,” available through BuilderBooks.com, helps builders navigate the scheduling process. Written as an easy step-by-step guide, this book demonstrates the methods for keeping projects on schedule and budget while coordinating resources, staff and materials. Every chapter focuses on a skill that enables readers to:
To view or purchase this publication online, click here, or call 800-223-2665. NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. NAHB Has Nearly 300 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 nearly 300 timesaving, moneymaking and cost-cutting business resources to help you run your business more profitably. Get guidance on accounting and financial management, business strategy, computers and information technology, customer service, human resources and more. Resources are added weekly, so bookmark www.nahb.org/biztools to go directly to these vital business management resources. Local and state home builders associations can link directly to www.nahb.org/biztools from their Web site and give their members instant access to these resources. It will make your HBA's Web site the place to go for the information and guidance that members need to succeed. Subscribe to NAHB’s Business of Building e/Source NAHB’s Business of Building e/Source is your monthly electronic guide to the hot issues and emerging trends in home building business management. You’ll find practical advice, tricks of the trade and sound business guidance — all delivered monthly, straight to your desktop, in a quick and easy-to-read format. Business of Building e/Source is available free to NAHB members and their employees. To subscribe, click here on the Members Only side of the NAHB Web site. IBS Has Tech Seminars About Increasing Efficiency, ProfitabilityFive seminars about how specific information technology solutions can increase efficiency and profitability are being offered at the 2007 International Builders’ Show in Orlando, Fla. on Feb. 7-9. The seminars are in the nextBuild/Technology track of the education seminars on the Builders’ Show Web site and include:
Injuries From Installing Drywall Can Be PreventedDrywall installers and carpenters who lift, carry or hold drywall sheets may be at risk of falling and overexertion hazards, usually involving the back, according to research from the National Institute for Occupational Safety and Health (NIOSH), which recently released recommendations on how to reduce these injuries.
Installing drywall can cause injuries to the back, including strains, sprains or tears ranging from minor to severe, NIOSH says, and the agency has also found that lifting heavy sheets of drywall — which can range in weight from 55 to 120 pounds and vary in thickness — poses a risk of back pain. Fall-related injuries during drywall installation can occur when workers lose their balance when handling the sheets or by other occurrences, such as falling from stairs. Poor lighting and a wet or slippery work floor, along with the sheets obstructing peripheral vision, can also be responsible for accidents. Many workers don’t have strong enough hands to grip drywall without exposing themselves to the risk of an overexertion injury, NIOSH adds, and this is exacerbated by cold and wet conditions. But even strong workers using good installation techniques can sustain injuries over time when they are installing drywall by hand. NIOSH cites three case studies:
The following precautions are recommended during the job:
Tickets Available for Safety Awards LuncheonIn conjunction with the upcoming International Builders’ Show, NAHB will be presenting the “First Annual Safety Awards for Excellence Luncheon” in recognition of builders who have developed excellent work site safety programs and made outstanding contributions to advancing construction safety. Fannie Mae is sponsoring the award in support of NAHB’s efforts to promote best practices in the housing industry. The awards ceremony will be hosted by Scott Morgan, of HGTV’s “Dream Builder” show. Morgan has a background in home building, including working on the construction of solar homes, and he has hosted several specials for HGTV, including “Eco-Smart Living,” “Blitz Build 2000” and “The Western Home Awards.” The luncheon will take place from 12:30-2:30 p.m. on Friday, Feb. 9 at the Peabody Orlando Hotel just across the street from the convention center. Tickets are $50 per person, or $450 for a table of 10. Award finalists will be posted on www.nahb.com/SAFE on Monday, Dec. 18, and the winners will be announced at the luncheon. To purchase tickets, click here. Advance registration is required for this event. Online tickets will be available until Thursday, Feb. 1. For more information, go to www.nahb.org/SAFETICKETS. Enter the 2007 50+ Housing Design, Marketing Competition
Enter the 2007 Best of 50+ Housing Awards, the premier design and marketing competition for the 50+ housing industry. Entries are due by Feb. 23. Sponsored by the 50+ Housing Council, the award program honors the best in more than 50 categories covering all aspects of the 50+ housing industry. “Anyone who is involved with the design, marketing, building and development of 50+ housing products ought to enter,” said Bob Tippets, of Village Communities of Midvale, Utah and incoming chairman of the NAHB 50+ Housing Council. “The Best of 50+ Housing Awards offers its winners not only recognition, but a great way to promote their business.” Active Adult Active adult categories include overall community, clubhouse design, condominium unit design and model home merchandising. Design Other design categories include aging-in-place, assisted living, congregate-living community, continuing care retirement communities, mixed-use, multifamily housing, renovated housing and special-needs housing. Marketing Marketing categories include logo, community brochure, direct mail piece/campaign, Web site, black-and-white and color print advertisement, radio and television commercial, sales center and special promotion. “The 50+ housing arena is constantly evolving and changing for the better,” said Doug Van Lerberghe, chairman of the awards committee and an architect with Denver-based design and community planning firm, KEPHART. “The Best of 50+ Housing Awards is an opportunity to recognize builders and other professionals who contribute their most inspired efforts to meet the needs of this unique market.” Winners will be announced at the Best of 50+ Housing Awards gala during the Building for Boomers & Beyond: 50+ Housing Symposium 2007 in Denver from May 30-June 1. Winners will also be featured on the NAHB Web site and in “50+ Housing Magazine.” The Call for Entries, contest rules and list of categories are available online at www.nahb.org/50plusawards, or by calling 800-368-5242 x8220. Save the Date for 2007 50+ Housing Symposium Mark May 30-June 1, 2007 on your calendars to attend the 50+ Housing Symposium. The seniors housing symposium is the premier educational and networking event for industry professionals who serve the burgeoning 50+ market. Visit www.nahb.org/build4boomers for more information. “Boomers on the Horizon: Housing Preferences of the 55+ Market,” available through BuilderBooks.com, can help you better build and market homes to this age group. Capitalize on the niches, needs and opportunities of this rapidly growing market by learning their preferences. To view or purchase this publication online, click here, or call 800-223-2665. NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. Builder Confidence in Condo Market Sinks in Third QuarterResponding to slower sales and a growing inventory of units on the market, builder confidence in the condominium housing market eroded in this year’s third quarter, according to the latest NAHB/Fannie Mae Multifamily Condo Market Index (MCMI). “Many of these condo communities are large, urban projects or high-rise communities in resort locations, and as such, they take a long time to plan and build compared to a single-family home” said David Seiders, NAHB’s chief economist. “As a result, multifamily developers cannot simply turn off the supply overnight, so it is going to take a little while before we work through the large overhang of inventory in this sector.” The component of the index that tracks current condo supply conditions fell markedly to 19.7 during the third quarter, compared with 47.1 at the same time last year. The scale is from 0 to 100, and a rating of 50 generally indicates that the number of positive responses is about the same as the number of negative responses. The index tracking builder expectations for the condo market over the next six months was also down, sinking to 27.9, compared to last year’s third quarter level of 55.3. Meanwhile the index tracking demand, based on the volume of traffic by prospective condo buyers, stood at 23.7. In a series of special questions for condo developers, almost half of the respondents — 49% — reported that they had reduced prices on their condo units in order to boost sales. The majority of these respondents reported cutting their sale prices on units by 5% to 7%. “With prices adjusting and interest rates still low, we are seeing increased affordability on many of these units,” said Seiders, who noted that the condo market really needs time to come back into equilibrium after the buying frenzy of the past several years. “With supply starting to be constrained, the market will have a chance to improve,” he said. For more information, e-mail Ann Marie Moriarty at NAHB, or call her at 800-368-5242 x835. Register for World of Concrete 2007 in Las Vegas Next MonthMore than 1,500 exhibitors, as well as seminars, demonstrations and tours, are planned for the World of Concrete, the premier trade show for concrete industry contractors, professionals and manufacturers. The show will be held from Jan. 22-26 in Las Vegas. To register online, click here. NAHB's Concrete Home Building Council will host a Train the Trainer course for industry professionals who want to teach and enhance their presentation skills in the classroom and with the media. For more information about World of Concrete, visit www.worldofconcrete.com. Education Calendar
Learn More About The NAHB University of Housing 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. NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar on the NAHB Web site. For assistance, call the NAHB Member Service Center at 800-368-5242. Drywall, Plywood, Shingles Needed in New OrleansUnited Way for the Greater New Orleans Area has requested drywall, plywood and shingles for the rebuilding effort in the aftermath of Katrina. The agency, which served 85 agencies in the New Orleans area, is specifically seeking these by the end of this year. Donations will be processed through Gifts In Kind International with the "ship to" directly to New Orleans. Gifts In Kind serves as a donation conduit between for-profit companies and nonprofit organizations in order to benefit communities in need worldwide. To donate, complete the Product Donation Agreement and fax it to the attention of Doyle Delph, of Gifts In Kind, at 877-798-3192. For questions or more information, contact Delph at 703-836-2121 x532, or visit the Gifts In Kind International Web site at www.giftsinkind.org. Give to the Home Building Industry Disaster Relief Fund The Home Building Industry Disaster Relief Fund (HBIDRF) is accepting end-of-the-year monetary donations. NAHB created the fund to help rebuild communities that were affected by natural disasters. For more information about the programs funded through the HBIDRF, or to make a donation, visit www.NAHB.org/disasterrelief. Builders Working to Reduce Energy Use, Says PresslyDuring a keynote address last week at the annual meeting of North Carolina Energy Star® raters, NAHB president David Pressly called for clarifying the Energy Star checklist to encourage more home builders to participate in the federal voluntary energy efficiency program. “I am always looking for opportunities that encourage this professional community — our builders, suppliers, regulators and, of course, you, the Energy Star raters — to work together in a harmonious way, because the result is better home building,” Pressly said. An important key to increased participation in the green building movement, Pressly noted, is the continued success of NAHB’s Model Green Home Building Guidelines, which have provided the framework for a dozen regional programs by state and local home builders associations, with another dozen under development. While green building encompasses a wide range of practices such as water conservation and recycling, energy efficiency is essential to true green building, he said. “It all goes back to energy, which is why our relationships with experts such as you, who can help us make homes more resource and energy-efficient, is so very important,” Pressly said. “It has been NAHB’s policy for many years to support voluntary energy efficiency programs. Energy Star is the most prominent,” he said. ‘Carbon-Neutral’ by 2030 Pressly also touched on the 2030 Challenge. Issued by the American Institute of Architects and endorsed by various environmental and civic groups, including the U.S. Conference of Mayors, the goal of the challenge is for all new buildings by the year 2030 to be "carbon-neutral" and use no energy from fossil fuels that produce greenhouse gases. “Fifty percent of the homes that we will need in 2030 haven’t even been built yet,” said Pressly. “That, to me, is the real 2030 challenge — to build these homes — and we need to keep more than just energy efficiency in mind when we do that. We need to think about water efficiency and resource efficiency. We need to build green.” NAHB members have voted to have the association’s green guidelines considered for further acknowledgement as an industry standard practice through formal ANSI procedures. Local jurisdictions considering developing green building programs can look to the ANSI standard for a model — and to the success of locally based, voluntary programs as inspiration, Pressly said. The NAHB leader also asked the raters for help with the certification process, noting that the paperwork builders need to complete is confusing and inconsistent, and that Energy Star officials agree. “I know that you share our frustration with some aspects of the thermal bypass checklist,” he said. “It’s very difficult for both builders and for raters when the checklist is modified numerous times, because then, of course, it becomes difficult to follow. Our members want to do the right thing, and the right thing is significantly easier to do when the checklist is not so topsy-turvy. If it’s not builder friendly, you aren’t going to have a lot of builders following it — that just makes sense.” Not Enough Energy Raters to Go Around Another problem, builders say, is that there are not enough raters to go around. “In our area, I only know of two — and the one that I use is swamped, and that slows things down,” said Matt Belcher of Belcher Homes in Wildwood, Mo. “It’s a hurdle we have to overcome somehow.” Pressly ended with a pitch for green building — and asked for support from the energy-rating community for voluntary programs like those created by HBAs using NAHB’s guidelines. “We want your support — and your help — to encourage the growth of voluntary, market-driven green building standards. These are preferable to mandates, which can reduce the incentive and the market pressure to adapt and to change and enable green benchmarks to continually improve as builders gain more experience,” he said. “A flexible, regionally appropriate approach is preferable to a unilateral approach that does not take into account local issues, architecture or geographic differences. There is no one-size-fits-all green building standard.” For more information, e-mail Calli Schmidt at NAHB, or call her at 800-368-5242 x8132. Builders Subject to Effluent Rules, Court DecidesThe U.S. District Court for the Central District of California has ruled against the Environmental Protection Agency and NAHB in a suit brought by the National Resources Defense Council over whether the EPA should be required to create effluent limitation guidelines (ELG) for the residential construction industry. Not subject to these guidelines, home builders instead have been following stringent erosion and sediment control rules set by federal, state and local authorities — and have been saving an estimated $3.5 billion dollars a year by avoiding another layer of federal regulation, according to NAHB estimates. The ruling is an extension of a partial summary judgment earlier this summer. Now final, the decision sets the stage for an appeal from EPA. In the meantime, EPA must collect background information on discharges by home builders by next December, and if the judge’s decision is not set aside during an appeal, ELGs will be required beginning in December 2009. “We always need to consider housing affordability. It’s important to participate in this process and try to influence the writing of the rule to be as reasonable as possible,” said Chuck Ellison of Miller and Smith homes and chairman of an NAHB working group that was formed in 1999 to look at ELGs and offer advice to EPA.. The judgment makes no sense, he said. “We participated with EPA and we know things were done properly.” "NAHB is disappointed in the court's decision," said NAHB President David Pressly. “We agreed with EPA's 2002 decision not to issue ELGs because the data did not support their adoption, and because the duplicative regulation ends up being reflected in the price of a new home without offering additional protection for our nation's waterways." The $3.5 billion in annual savings that NAHB and EPA calculated several years ago is likely higher today, he added. Effluent limitation guidelines limit the amount of pollutants in wastewater discharges from specified industries and usually include numerical limits for specific pollutants. Sediment is the pollutant of greatest concern for home builders, and the industry will be forced to meet ELGs through a combination of approaches, such as silt fences, rock filters or the preservation of existing trees and grass — measures that builders and developers already use to meet existing state and local regulations. In the worst case, additional, expensive monitoring equipment could be required, Ellison said. "We want to protect our environment and we are happy to offer our expertise, but I can think of more efficient ways to meet that goal than another layer of rulemaking," Pressly said. For more information, e-mail Calli Schmidt at NAHB, or call her at 800-368-5242 x8132. Training Program Jump-Starting Construction CareersSince it was launched in 2005, Home Builders Institute's (HBI) “Building Today’s Workforce for Tomorrow” program has already established a successful track record in preparing students to enter the residential construction industry. Funded by the Department of Labor (DOL) under the President’s High Growth Job Training Initiative, HBI has established programs in 10 states, each offering at least 250 students industry-sponsored training in carpentry, electrical, plumbing and HVAC. Moving beyond the traditional approach to trades training, HBI and its partners have created a comprehensive approach to construction industry workforce development that provides career exploration and recruitment for high school students as well as incumbent and displaced workers. While HBI has worked with a great number of organizations to implement the program, the expertise of local and state home builders associations has been pivotal. Other partners include K-12 school districts, community colleges, workforce investment boards and Job Corps Centers (JCC). Success From Coast to Coast “This is a much more efficient approach to construction training in these trades,” said John Orr, president and CEO of the North State Building Industry Association in Sacramento, Calif. “As an association, we need to do more about workforce training so that programs are strengthened and enhanced, and to do that we need support from builders, the trades and suppliers — our members.” Participation in “Building Today’s Workforce for Tomorrow” enabled Lajuan Woodfork, a recent carpentry graduate from HBI’s Jacksonville JCC, to jump-start his career with a job at Thomas May Construction and to enter directly into the Northeast Florida Builders Association's second-year apprenticeship program. “Lajuan is just a good person; he has a lot of focus and determination. He really gives some thought to what he is doing,” said Kent Hiter, a construction superintendent for Thomas May. “We have high hopes for him, and if he sticks with us he will get to do a little bit of everything.” With total employment in the construction industry predicted to increase by nearly 1 million jobs by 2012, the need for skilled training is in high demand. As part of the “Building Today’s Workforce for Tomorrow” grant, HBI will provide “best-practice” research to DOL, so that the program may be continued and/or replicated. “Building Today’s Workforce for Tomorrow” programs are up and running in Arizona, California, Connecticut, Florida, Idaho, Kentucky, New York, South Carolina, Pennsylvania and Virginia. For more information, e-mail John Shortt at HBI, or call him at 800-795-7955 x8924. Good Margins Start With Knowing Costs of BuildingBuilders don’t have to tear their businesses apart to improve their margins, according to FMI Corporation and CatCon Systems. And they probably don’t want to follow in the footsteps of many of the nation’s top 20 builders who have embarked in recent years on well-publicized centralization efforts to do everything from revolutionizing the home building supply chain to delivering 20% reductions in cost and cycle time, only to end in failure. A management consultant and investment banking company for the construction industry, with offices in Raleigh, N.C.; Tampa, Fla.; and Denver, FMI Corporation is a member of the National Council of the Housing Industry — The Supplier 100 of NAHB. Many home builders have sought to preserve their margins by mandating price concessions from their trade partners, channel partners and product manufacturers, says FMI. While this may work in the short term, it is a hard strategy to manage unless the builder has a detailed understanding of each key trade package. Margin management programs should more appropriately start by focusing on cost reduction, not price reduction, according to FMI. The first step, it says, is to take the most expensive trade packages — framing, drywall, concrete, roofing, etc. — and perform detailed takeoffs of the materials needed to complete a significant volume of active models in their division. “A critical step in this process is to field-verify the material take-off by walking units and counting material for each model being evaluated,” says FMI. “Once armed with both the take-off and field-verified counts, the builder has the knowledge to control costs, not to just manage bids. The challenge then becomes not to use this knowledge like a new-found hammer to pummel respective trade partners or suppliers with whom productive relationships are essential. Instead, use the verified data as a catalyst to discuss the importance of efficient, material conservation and cost management in today’s residential environment.” In the last several months, FMI says, it has found that volume home builders across multiple markets are able to realize an average material savings of more than $2,000 per home just by evaluating lumber, drywall and siding. Additional savings opportunities have been identified in roofing, masonry and interior trim categories. “Whether through an outside or internal resource, builders who understand the true cost to build and communicate those costs in a fair manner will enjoy substantial savings.” 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 WeekThe NAHB Production Group produces three weekly television shows on HGTV and DIY for consumers. The following is the latest lineup: "I Want That" on HGTV
"Rock Solid" on DIY
"Assembly Required" on DIY
Episode: "Deltec Round Kit Home (Part 2)"
HGTV Seeking ‘Dream Home’ Builder/Architect Teams HGTV is seeking developers, builders and architects to create the 2008 and 2009 dream homes for the network’s Dream Home Sweepstakes. To learn more, click here. About the NAHB Production Group 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. NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar of the NAHB Web site. For assistance, call the NAHB Member Service Center at 800-368-5242. Sioux Empire HBA Launches ‘Tools for Schools’
The Home Builders Association of the Sioux Empire in South Dakota recently launched its “Tools for Schools” program to help save the industrial arts programs at area high schools. The program provides needed tools and equipment and helps teach students about residential construction. “Tools for Schools,” begun at the start of the school year, provided state-of-the-art tables saws and blades to West Central High School in Hartford and Tea High School in Tea, S.D. near Sioux Falls. The program is funded in part through a $3,000 matching grant from the National Housing Endowment Challenge/Build/Grow Matching Grant Initiative. The HBA provided funds through its newly-formed Home Builders Care Foundation. “Through our foundation, we are helping schools acquire the necessary tools and equipment to teach students about the construction industry,” said Randy Bruner, the HBA’s president. “With support from the National Housing Endowment and this new foundation, we are able to provide a source of inspiration for students and are delivering a positive message about our industry.” “Building homes for the Sioux Empire is too important of a priority to neglect the education and training that will be needed to support the residential construction industry,” said Matt Swenson, chairman of the HBA’s education committee. “Through the ‘Tools for Schools’ program, as well as other community service efforts, the foundation is answering the call by meeting the industry's long-term challenges with bold thinking and action.” The endowment, the philanthropic arm of NAHB, created the Challenge/Build/Grow Grant Initiative to support HBA initiatives including education, land use and labor shortage/worker training and to help build and grow new partnerships at the state and local levels. The endowment has awarded more than $120,000 to state and local associations since the Challenge/Build/Grow program was started in 2001. For more information about grant opportunities, or to download funding guidelines, visit www.nationalhousingendowment.org.
Dell for the Holidays: Double Discounts Through Dec. 31This holiday season, Dell is offering double discounts to NAHB members on an array of products designed to meet the technology needs of your company. That means Dell’s normal discounts of 3%-5% to NAHB members will double to 6%-10% on essential small business technology, including business-class desktops and cutting-edge notebooks. Dell not only has the technology to make your home building business run more efficiently — it also offers NAHB members a more efficient way of doing business. To Get Your Discount Visit the Member Advantage main page on the NAHB Web site and click through Dell for complete details. To maximize your Dell Member Advantage Discount: After you have made your selections and are ready to purchase, call your dedicated Dell sales representative at 888-577-3355, Monday-Friday, 7:00 a.m.-8:00 p.m. (CST) and Saturday, 8:00 a.m.-5:00 p.m. (CST). Your sales representative will apply your NAHB member discount to your order. NAHB members who have previously ordered from Dell also receive a monthly catalog, which includes this double discount offer. The Dell Double Member Discount* offer is valid through 12/31/06. * Double discounts do not apply to the preconfigured systems that are already priced at up to 20% off. Other Member Advantage Discounts For the most up-to-date details on the Member Advantage discount program and all of the participating companies, go to the Member Advantage main page on the NAHB Web site. Free NAHB Kit Gives Builders Back-to-Basics Tips in Cooling Market With the current cooling of the nation’s housing market expected to persist into the middle of next year, NAHB has developed a comprehensive online toolkit geared to providing association members with information that will help them prosper in today’s changing business environment. To access the “Back to Basics” toolkit, you must be an NAHB member and have a login to www.nahb.org. To create a login, go to www.nahb.org/login or click on the log-in button on the main menu bar. For assistance, call the NAHB Member Service Center at 800-368-5242. Advice From Industry Experts: Ramp Up Sales and MarketingTom Stephani, S. Robert August and Bill Becker ― industry veterans who have been through market shifts more than once ― will discuss what changes you should make to your sales and marketing in order to thrive in today’s market during an upcoming audio conference. The hour-long teleconference, “Ramp Up Your Sales & Marketing in a Changing Market,” will begin at:
The conference will include a 40-minute presentation, followed by 20 minutes of questions and answers from participants. Think Like a Retailer Builders who haven’t made any changes to their sales and marketing approach in response to the changing market need to do so — yesterday, says Becker, MIRM, CMP, managing director and president of the William E. Becker Organization in Teaneck, N.J. He will share insights on how to develop a marketing plan that focuses on moving forward, and discuss how to re-evaluate that plan and adjust it if necessary. “We’re in the retail business. The three things that keep people coming back are: ‘new,’ ‘grand opening’ and ‘free,’” Becker says. “Retail makes money by having something new every day.” Keeping models fresh and offering new events on a consistent basis are crucial, he says. Begin Building a Strong Customer Base Now “Now is the best time to execute new sales and marketing campaigns,” says August, MIRM, CMP, Master CMP, of the S. Robert August Company, Inc., in Greenwood Village, Colo. During the conference, he will discuss how to overcome objections, build a stronger customer base and initiate unique and distinct sales and marketing programs for the business-to-consumer and business-to-business markets. “You’ll be able to a |