Print-All Page: August 9, 2010

A majority of the nation’s home builders have been offering incentives this summer to boost their sales in a generally cool marketplace, according to a recent NAHB survey.

The polling — which was conducted in June in conjunction with the monthly Builders’ Economic Council survey for the NAHB/Wells Fargo Housing Market Index — also found that some builders are using incentives to fill the void now that the May 1 deadline for signing a sales contract to qualify for the home buyer tax credit has come and gone.

“Some builders have, in fact, introduced new incentives in response to the expiring tax credit, but only a relatively small number compared to the number that historically advertise some type of special sales incentive,” said Paul Emrath, author of the special NAHB Housing Economics study, “Builders’ Use of Incentives After the Tax Credit.”

“Moreover, a relatively small share of the builders who currently advertise one of these incentives is explicitly marketing the incentive as a replacement for the tax credit,” he said.

Emrath noted that the uptick in single-family activity over the past year or so has been largely attributable to the enactment and extension of the credit, so it would be only natural for builders to devise new strategies in its absence.

Historically low mortgage interest rates and affordable housing prices remain major positives for housing, but economic growth and improvements on the employment scene have been slower than expected, according to economists at NAHB, putting housing this year on a decidedly more gradual upward path than usually occurs following a recession.

Nearly three-fourths of the builders surveyed by NAHB in June — 73% — reported that they were currently using and planned to continue to use at least one incentive unchanged.

Many builders, but far from a majority, said that they were adjusting their incentives programs — by changing existing incentives or initiating new ones — to compensate for not having the tax credit. Fifteen percent of the builders indicated that they were altering at least one of the incentives they had been using and 12% said they were adopting at least one new incentive, with some overlap between the two responses.

In addition, 15% of builders told NAHB researchers that they were initiating at least one new sales incentive, but for reasons unrelated to the fading tax credit.

Seventy-six percent of builders said they were currently using some sales incentive in June, which is down some from last year’s peak rates. In February 2009, 85% of builders were using incentives to bolster their sales; by June of last year that share had dropped to 79%.

Among the common types of incentives that builders have been using and will continue to provide, reducing the price of the home is the most popular, cited by 54% of the survey respondents. That was followed by offering options or upgrades at no reduced cost (50%) and paying closing costs (44%).

Reducing home prices became increasingly prevalent as the housing downturn deepened, rising from 18% of builders in January 2006 to 45% one year later, 52% in February 2008 and 72% in February 2009.

Offering green features at no cost or a reduced cost is the fourth commonest sales incentive, reported by 32% of the builders, followed by helping buyers sell existing homes, 25%, and absorbing financing points for buyers, 23%.

The NAHB study found that one-fifth of all builders are adopting a new incentive and/or modifying one they have already been offering to compensate for losing the tax credit as a marketing tool. Of all the builders surveyed, the most common incentives for filling the gap include:

Among incentives being adopted for reasons unrelated to the tax credit, offering green features at no cost or a reduced cost was the most common, cited by 8% of all the builders surveyed.

“Given recent experience with volatile energy prices and the public attention focused on possible climate change, it is probably not surprising that a significant share of builders are now adopting low-cost green features as a marketing device, nor that they are doing so for reasons unrelated to the expired home buyer tax credit,” Emrath said.

When the builders who reported using special sales incentives were asked if they were advertising or marketing those incentives as a replacement for the home buyer tax credit, 19% said yes and 81% said no.

Among the builders who have chosen not to offer sales incentives, the reasons for that decision include:

Nineteen percent of the builders gave other reasons for not relying on incentives. Most commonly, these were builders who only build custom homes to contract or otherwise operate in an environment where they don’t typically advertise, making incentives irrelevant.

“Other builders feel that advertising incentives is not an effective way to negotiate with customers,” Emrath said. “Some believe, for example, that so many customers will ask for incentives or concessions irrespective of any builder’s marketing campaign that it is more efficient to let the customer make the first offer.”

St. Louis Builder Not Waiting for a Stronger Economy to Improve His Sales

Not content to let a far less than spectacular economy or the dog days of summer stand in its way, McKelvey Homes in St. Louis is on track to double its home sales this year and make significant headway in digging out of the worst housing downturn in generations.

“We are not sitting around waiting for the economy to improve,” said Jim Brennan, president of the company. Established in 1898, McKelvey Homes is the oldest residential builder in the area, and the family business was purchased by Brennan from the grandson of its founder.

McKelvey is also the only local builder that was able to increase its home sales in 2009, an achievement that Brennan attributes to an adherence to conservative business practices, an established reputation for quality and the ability to adapt quickly to changing demand in the marketplace.

McKelvey Homes increased its revenue last year to $16.9 million, up from $16 million in 2008, and rose from 11th to fourth place among the largest St. Louis builders during a period when more than half a dozen local builders disappeared from the scene, including two of the biggest.

Through June, the company this year sold 36 homes worth $17 million, already matching its performance for all of 2009. With some help from the home buyer tax credit, business was good this spring, according to Brennan, although he sells primarily to trade-up buyers, many of whom completed purchases even though they were not eligible for the tax incentive.

Like just about everyone in the home building business, McKelvey has had to contend with a sharp decline in demand, and has rolled back its prices and rolled out incentives to bolster its sales. “We have been very aggressive and give people a reason to move now,” said Brennan.

Currently, buyers are being offered $20,000 in free options, which can also be taken off the base price of the home. The options include brick and stone exteriors, surround sound, coffered ceilings, hardwood flooring and a hybrid energy package.

In the St. Louis area, where temperatures and gas and electric prices can fluctuate markedly, McKelvey’s hybrid energy system enables consumers to go back and forth between the two utilities. The system is programmable, he said, and in one model was able to save 42% in energy costs.

To provide peace of mind to move-up buyers who are concerned that they won’t be able to sell their current home, McKelvey can provide a secured sale plan that will pay the interest, taxes and insurance on the existing home for up to six months in the event that it doesn’t close on time. “We have had quite a few people take advantage of it,” Brennan said, “but most sell their homes.”

To help expand its customer base and solidify its reputation for quality, McKelvey also will pay $1,000 to past customers who refer a buyer who is a friend or relative. The builder will also shave $10,000 off the sales price for repeat buyers.

At a time when consumers are pinching pennies, McKelvey has taken its larger bestseller — the Turnberry model — and redesigned it to yield the best possible value, including a modest reduction in size.

The resulting one-and-a-half-story Muirfield is now the builder’s most popular floor plan.

The home is 3,717 square feet, down from the Turnberry’s 4,015. Both homes feature standard hearth rooms, great rooms, bonus rooms and Jack and Jill baths. The larger home's name brands were also kept — including Kohler, Whirlpool appliances, Aristokraft cabinets and Silverline windows by Andersen.

“We were able to re-engineer the home and keep the same number of rooms while maintaining the character and functionality of the larger home,” said Brennan. This effort helped achieve a $40,000 reduction in the home’s retail price, which starts as low as $297,600.

As a result of its efforts to make the best of challenging times, Brennan said all of his sales managers are busy actively working with prospects.

McKelvey’s homes have open floor plans that are functional and designed with the help of professionals. “We really sweat the details,” he said, and buyers can customize.

Customers can also contribute to the design process. “We get a host of ideas from them,” he said. For instance, when buyers balked at the two-story great room in the company’s most popular two-story model, the Edinborough, the builder put a bonus room above it, which is now a step-up bonus room.

Despite the amount of attention lavished on the interior, Brennan said that curb appeal is what sells homes. “People buy homes on the exterior first,” he said. He can personally attest to that because he made the decision to buy his first home before he saw what was inside. “Exteriors must be very attractive,” he said.

Brennan also believes that having some homes in inventory is an inducement to buyers and he aims to keep one or two houses in various stages in each community. As the deadline for signing a sales contract to qualify for the home buyer tax credit neared at the end of April, McKelvey sold out in several locations, with people purchasing model homes. Sales trailers are now sitting in two locatioins, “and we are rushing to bring new displays on line.”

Adhering to the advice of business consultants such as Lee Evans, Brennan came into the housing downturn as reasonably prepared as possible given its magnitude. “We have been able to weather the storm,” he said. “There’s good times and times not as prosperous, so we planned for that.”

Brennan said that his business has also been able to draw the credit it needs to keep building by establishing long-term relationships with his banks, not being highly leveraged and having a strong balance sheet and good liquidity. “With that financial strength, they are confident in extending credit terms to us,” he said.

These days he is also buying lots from banks that took back property from builders who went out of business.

Meeting regularly with a solid, close-knit network of trade partners and suppliers, Brennan voiced confidence that he can keep coming up with the ideas he needs to draw more buyers by improving designs and controlling costs.

“Only through adversity do you really know your skill level,” he said. “For those who survive, it’s an opportunity to innovate and make the best of a difficult economy.”

It’s Time for Builders to Start Talking to Their Appraisers

Builders need to talk to appraisers and lenders to ensure that they receive an accurate valuation of the new homes they are selling, according to panelists participating in an NAHB webinar on Aug. 4.

The lines of communication have been down for a considerable period of time, largely as the result of difficulties in interpreting the meaning of the Home Valuation Code of Conduct that was put in place by Fannie Mae and Freddie Mac to prevent builders from having an inappropriate influence on the appraisal process.

Unfortunately, with insufficient information from builders about specific homes and the local marketplace, in a downwardly spiraling marketplace appraisers began relying excessively on short sales and foreclosures, properties that often are not comparable to newly constructed homes because they have been neglected and are run-down.

New policies from Fannie Mae and Freddie Mac attempt to correct this shortcoming as well as other problems that have emerged in the appraisal process. In addition to providing clarification on communication and the use of distressed home sales as comparables, the guidance also bars lenders from changing appraisal reports and emphasizes the importance of selecting appraisers with appropriate knowledge and experience to undertake various assignments. (For a related story in the July 12 edition of NBN, click here.)

Builders should meet with the appraiser on the site of where the home has been or will be built and provide direct support with whatever relevant information they can, advised Martin Mitchell, vice CEO and vice president of land and business development at Mitchell & Best in Rockville, Md.

“It can’t be said enough: communicate, communicate, communicate,” Mitchell said, noting that “last year we were 180 degrees from here and told we couldn’t communicate. Go out and find the comps yourself; look at the multiple listing service and pull what you can from that to assist in comps.”

“Good information that builders should provide,” said Allen Gardiner, vice president of residential for Jackson Claborn Inc., an appraisal and real estate consulting firm in the Dallas-Fort Worth area, “includes traffic, absorption rates and the sales you are making so that the appraiser can know what the demand is.”

“One of the biggest mistakes builders make is they hide data,” Gardiner said. “Provide all the relevant data, present a low-priced sale if there is one out there and let them know why the sale is low, and show how it is related to higher-priced sales.”

Looking at construction specifications, “make sure the appraiser knows the materials in the property and why they were chosen,” said Gardiner. “The more the appraiser understands, the better.”

Mitchell also cited the importance of communicating with lenders on appraisal issues arising during loan workouts. “A builder needs to understand he’s not a bystander in this process. He’s got to be an active participant if working through an acquisition, development or construction loan that’s a problem."

“Start by helping your lender, who hasn’t seen a down market,” Mitchell suggested. “The builder knows the project better than the lender and should take the position that they are the expert on the project.”

Also, “builders should understand their lender’s health. Are they strong? Do they have capital? An unhealthy bank without reserves may not have the flexibility to work with you.”

To improve negotiations, “tailor a plan that the lender can support,” Mitchell said. This includes explaining how the marketing plan will be improved, by lowering prices and other means, and convincing the bank that there is big financial advantage to building out the project instead of liquidating at today’s extremely low values.

And of primary importance, “request the lender to get an appraiser who is experienced in your area, who understands new construction and green building values.”

The use of inexperienced or under-qualified appraisers by lenders has been “one of the biggest issues,” said Gardiner. Banks have been relying upon appraisal management companies (AMCs) to select the appraiser. Too often this can be a matter of finding the appraiser who charges the best fee but doesn’t provide the best quality, and an inadequate amount of time is provided to complete the evaluation, making it difficult to adequately conduct proper research.

Appraiser selection criteria are based solely on lender guidelines, Gardiner said. “Builders should demand that lenders use qualified, designated appraisers. Your first concern should be the lender and their process of selecting appraisers.”

Most lenders require one sale from the builder, one from a competing builder and/or a re-sale from the subject’s neighborhood. The lender can require having two to three sales within 90 days in addition to one pending sale and one listing, he said. However, he emphasized that the bottom line is that the appraiser is responsible for coming up with the most accurate valuation possible.

Gardiner noted that lenders are not required to use AMCs. “They can use local and regional appraisers” who have more experience in the local market, he said, and will apply less restrictive guidelines than an AMC.

“Find out how lenders are choosing their appraisers,” he said. “Many are managing appraisals in house” and picking appraisers who will provide the best service for a particular project.

“Make sure how the lender selects the appraiser is the best process for you,” said Gardiner. For example, making selections on a rotating basis is not likely to yield the best results.

To avoid having to challenge an appraisal for the inappropriate use of comparables, “what you do up-front is your best defense,” he said. “Make sure the information is in the appraiser’s hand,” including information on the best and all relevant sales. “If the appraiser doesn’t use that information, you can tell the lender he needs to find out why.” For this purpose, “keep a record of the data you give to the appraiser.”

In addition, “understand the appraiser’s challenges,” said Gardiner. “If the appraiser is coming into a market where there are no sales, recognize that fact and talk about value. Build a relationship with the appraiser. Develop your own relationship and don’t rely on the lender’s relationship with the appraiser. Be willing to engage the appraiser to assist you in your efforts.”

The builder may have to sign a release form, but Mitchell said it is a good idea to request a copy of the appraisal. “Look it over detail by detail to make sure everything is included,” he said.

To access a recording of the program, "Builders Guide to Appraisals," click here.

For more information, e-mail Steve Linville at NAHB, or call him at 800-368-5242 x8597.

Fannie Mae, Freddie Mac Losing Political Support as U.S. Reshapes Housing Finance System

On Aug. 17, the Treasury Department is hosting a conference of financial companies, housing advocates, academics and other interested parties to begin discussing how to design a new housing finance system that doesn’t rely as much on taxpayers. The Obama Administration is required to make a proposal by January under the bill recently passed by Congress to reshape financial regulation. A consensus is emerging among housing companies and consumer advocates over what to do with Fannie Mae and Freddie Mac. That common ground is evident in letters filed last month with the Treasury Department in response to a request for public comment about the future of U.S. housing policy. Many of the groups that responded want to maintain Fannie and Freddie — or set up several similar entities — as heavily regulated companies that offer a guarantee to investors in high-quality mortgage loans. The federal government would stand behind the guarantee. Under this scenario, the companies would charge mortgage originators a fee for the guarantee and use some of the money to cover mortgage investments that go bad. Part of the fee would be contributed to a separate insurance fund that would be tapped if one of the companies fails and can no longer stand behind the mortgage investments it guaranteed. Investors, the thinking goes, could remain confident in the mortgage securities and continue to buy them. The consensus approach would try to fix several flaws in the original design of Fannie and Freddie that contributed to their collapse — notably, their implicit government guarantee. (www.washingtonpost.com)
Washington Post (8/7/10); Zachary A. Goldfarb

Four Reasons to Be Upbeat on Housing

There are several factors that could buoy housing during the second half of 2010, according to Michael Darda, chief economist for MKM Partners. First, with home sales and mortgage-purchase applications falling to record lows in the wake of the expiring first-time home buyer tax credit, there is a very low base against which to measure future gains. Second, we are now moving into a period (May to August) that tends to be seasonally strong for housing, as evidenced by the strong Case-Shiller numbers for May. Third, the affordability backdrop remains highly favorable, as home prices are at a record low relative to per capita disposable incomes, while mortgage rates are also at record lows. Fourth, although the recovery of the labor market to date has not been as robust as many had hoped for, private-sector jobs and income are growing and are likely to continue expanding. The highest-frequency indicators to watch for housing are weekly mortgage purchasing applications (which fell sharply over the last few months but appear to be stabilizing), the NAHB HMI Future Sales Index (which has weakened recently, but we believe should firm in the months ahead), weekly jobless claims (which our credit market indicators suggest should fall from current levels) and spot lumber prices (which took a 41.5% tumble over the last three months, but have begun to firm recently.) (www.barrons.com)
Barron’s (7/28/10) Michael T. Darda

Six Reasons to Buy a New Home Now

Prospective home buyers who thought new-construction homes were out of reach should think again. For now, they are holding their own against their resale counterparts. Here’s why. First, “Prices are rock bottom,” said Andy Konovodoff, president of Lombard, Ill.-based Town & Country Homes. “Prices of the new market equate to the prices we were selling homes for in the 1990s. I recommend not to wait to catch the bottom. We’re at the bottom, but just bouncing along. The demand is building. When it comes back, prices are going to appreciate very quickly.” Second, low mortgage rates. “If you have a comfortable income that you believe will remain at that level, now is an excellent time to strike,” said NAHB Chief Economist David Crowe. “You can no longer take advantage of the federal buyer credits, but these interest rates are a huge incentive to strike now. I think they will remain relatively low for another year, but I don’t think they will be as low as they are right now for an extended period. As the economy heats up, rates will go up.” Third, tax advantages. “You can deduct the mortgage interest and property taxes from income taxes,” said Crowe. “And when you sell the house, you do not have to pay capital gains tax on the first $500,000 in gain.” Fourth, energy efficiency. Crowe pointed out that improved building codes mean more energy-efficient homes, which cost less to operate. Fifth, amenities. Sixth, a place to call your own. For many people, homeownership offers peace of mind and a feeling of stability. “There’s the psychological benefit of it being your place,” said Crowe. “You can decorate it, renovate it, change it and customize it to your taste. You don’t have to ask the landlord for permission.” (www.chicagotribune.com)
Chicago Tribune (8/6/10); Brenda Richardson

Nielsen: This Isn’t Your Grandfather’s Baby Boomer

Researchers at Nielsen believe consumers over the next decade will have fewer children, leading to smaller households and fewer young consumers to lure. A rough economy will lead to those smaller young families spending less, and smaller salaries for younger generations known today as “Generation Y” and “Millennials.” As the baby-boom generation retires and grows old, America is likely to have a larger older population and a much slower-growing young one, suggested Doug Anderson, Nielsen’s senior vice president for research and thought leadership. “There will be a huge number of people over the age of 65, 75 and 85 over the coming decade. We’ve never had a population this big this old before,” he said. “This is not something that demographers and anthropologists have tons of models sitting around that they can talk about. We as a species have never had this many older people before. It’s new ground.” Most times senior citizens are still seen in ads selling life insurance or denture cream, yet the older person in the U.S. in the next decade is likely to be anything but helpless and in the market for more than just financial help and medications. According to Nielsen, baby boomers in 2010 account for approximately 38.5% of all dollars spent on consumer package-goods such as diapers, toothpaste and laundry detergent. They account for 40% of customers paying for wireless services and 41% of customers paying for Apple personal computers. And while brand alliances are often thought to be established when a consumer is in his or her 20s, changing technology has unleashed a steady spate of new devices and gadgets that are new to all consumers. With older folks having salted money away and younger consumers expected to find income shrinking over the next decade, “targeting older consumers makes sense because you might be reaching more of your consumers” with the pitch, said Pat McDonough, Nielsen’s senior vice president for planning and policy analysis. (www.adage.com)
Advertising Age (7/19/10); Brian Steinberg

Friendly Fixtures

According to the 2009 Characteristics of New Housing survey by the U.S. Census Bureau, there was a 12% increase in porches between 1999 and 2009. NAHB also released a report saying that between 1995 and 2005, the number of new homes with porches increased about 10% while decks decreased 7%. Gina Muzzy, who co-owns Muzzy Builders Inc. with her husband, Doug Muzzy, said front porches are making a comeback because people want to increase the curb appeal of their homes. “For the types of homes we build, we always have some sort of a front porch,” Gina Muzzy said. “You want people to like your house enough to stop and look at it.” Some of the homes by Muzzy Builders are in the Village of Cherry Hill, a neighborhood based on the New Urbanism movement, another reason for an increase in front porches. According to the website for New Urban News, a publication that promotes the movement, the idea is “based on principles of planning and architecture that work together to create human-scale, walkable communities.” It is a response to the increase of suburbs after World War II, which separated the residential areas from businesses, thus increasing the reliance on cars. (www.columbiatribune.com)
Columbia Daily Tribune (8/1/10) Haley Adams

A Walker’s Guide to Home Buying

Today’s home buyers aren’t just looking for good schools and low crime rates when they evaluate a neighborhood, many brokers say. They’re paying much more attention to what they can walk to. “Everyone wants to know now how close they are to stores,” says Linda Duggan, an owner of The Duggan Group real-estate agency. She recently had clients who, given a choice between a house in Danville, Calif., and another that was bigger, newer, $300,000 cheaper — and 20 minutes farther from town — chose the first one. Earlier this year Scott Newman, of Newman Realty in Chicago, started highlighting how close his listings are to amenities. The number of amenities in walking distance can vary sharply from block to block, he adds. Websites have sprung up to rank which homes have the most amenities within walking distance. The most commonly used one is Walk Score, started in 2007 by Seattle software company Front Seat. The site saw visits in May more than double from year-earlier levels, to 938,000, according to comScore Inc., which measures online audiences. Ads on real-estate websites now include Walk Scores, and some 4,000 websites now link to the site’s map, where users can input an address and get a score. Real-estate prices are reflecting the new interest in walking distances. A study published in August of 90,000 homes across the country by nonprofit CEOs for Cities, a group of urban-redevelopment advocates, found that having more amenities in walking distance can boost home values. As measured by Walk Score, walking-distance amenities raised values by as much as $3,000 for a one-point increase in rankings. (www.wsj.com)
Wall Street Journal (7/2/10); Nancy Keates

Senate Postpones Action on Small Business Lending Bill

Although the Senate failed to act on legislation to establish a $30 billion lending program for small businesses before adjourning for its August recess, Senate Majority Leader Harry Reid (D-Nev.) indicated that the chamber will attempt to bring up the measure when Congress returns during the week of Sept. 13.

In a legislative victory for NAHB, the House last month voted 418 to three to ensure that builders would have the same access as other small businesses to the loan program created by H.R. 5297, the Small Business Lending Fund Act of 2010.

As it currently stands, the Senate bill includes the small business lending fund but does not allow it to be used to provide construction loans to small builders.

In a letter sent to every member of the Senate, NAHB stressed that without language providing equal access to this program for the nation’s small builders, the amendment does not adequately address the small business lending concerns currently facing the nation. NAHB noted that housing was the first sector hit by the current economic crisis, and that recovery cannot be sustained without a revival of the housing industry.

NAHB continues to fight for the inclusion of the construction loans in the Senate bill and to ensure that any final legislative package addresses the housing credit needs of the home building industry.

To view the legislation, click here and type H.R. 5297 in the box at the upper center of the page.

For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.

Congress Approves Increase in FHA Premiums, Bolsters Program

The Senate on Aug. 4 approved H.R. 5981, legislation that will help recapitalize the Federal Housing Administration (FHA) and allow the program to operate responsibly without congressional funding.

While the FHA now services nearly 30% of new mortgages, the agency’s loan losses have depleted its capital reserves, leaving the Mutual Mortgage Insurance Fund below its statutory minimum reserve ratio. H.R. 5981 will enable the agency to better manage its risk and improve its financial position by adjusting the premium structure on FHA single-family mortgages for new borrowers and shifting some of the upfront cost to the annual premium.

Specifically, the legislation allows the FHA to increase the annual mortgage insurance premium (MIP) from 0.55% to 1.55% for borrowers who make less than a 5% downpayment.

While the FHA is only expected to increase the annual premium to between 0.85% and 0.95%, this additional flexibility will allow the agency to reduce the up-front MIP, which was recently increased to 2.25%. Shifting some of the increase from the up-front to annual premium will reduce the impact on the consumer.

NAHB supported this measure, which will bolster the agency’s capital reserves, and continues to work with lawmakers to enact further reforms that will ensure sound lending practices by the FHA.

To view the legislation, click here and type H.R. 5981 in the box at the upper center of the page.

To view comments from FHA Commissioner David Stevens on passage of H.R. 5981 and the need to achieve broader FHA reforms, click here.

For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.

Senate Delays Vote on Energy Bill, Home Star Provisions

After failing to reach agreement with Republicans, Senate Majority Leader Harry Reid (D-Nev.) scrapped plans to bring an oil spill liability and energy bill (S. 3663) to the Senate floor before Congress adjourned for its August recess.

Of note to home builders, the legislation also included provisions for the Home Star program, which is designed to provide rebates to home owners who hire contractors to install new heating and air conditioning units, replace old windows and water heaters and make other energy-efficient upgrades.

It is uncertain if the Senate will reconsider energy legislation when lawmakers return in September. In the interim, NAHB and other business groups continue to work with Senate staff to make helpful changes to the Home Star provisions.

Specifically, NAHB and a coalition of other small business organizations who represent hundreds of thousands of contractors across the nation are urging the Senate to change the program to allow rebates to be provided to home owners, not contractors, who may not have the financial resources to float the rebate amount to the home owner as a short-term loan.

In a recent letter to the Senate leadership, NAHB and other business organizations said that “contractors not able to ‘float the loan’ would opt out of the program altogether, thereby not allowing themselves the opportunity to take advantage of the program.”

By contrast, the House-passed version of the Home Star legislation (H.R. 5019) requires rebates to be sent directly to the home owner.

NAHB is also urging the Senate to expand the certification opportunities under the Home Star Gold Star program. Under the Senate bill, only contactors who are accredited by the Building Performance Institute can offer home owners the more valuable Gold Star rebates.

The Senate letter stated that 29 states currently do not have a single contractor who could offer home owners a pathway to Gold Star rebates.

“In order to remedy this situation, we urge the Senate to expand the opportunities for home owners to obtain Gold Star rebates for energy saving retrofits in the legislation,” the letter said. “Otherwise, the job creation benefits of the Home Star Retrofit Rebate Program may not fully materialize.”

To view legislation, click here and type the bill number in the box at the upper center of the page.

For more information, e-mail Elizabeth Odina at NAHB, or call her at 800-368-5242 x8570.

Congress Acts to Boost Multifamily Loan Authority

The Senate last week approved legislation that will ensure the Federal Housing Administration (FHA) will continue to have sufficient funds to finance multifamily mortgage insurance programs.

H.R. 5872, The General and Special Risk Insurance Funds Availability Act of 2010, was passed by the chamber on Aug. 4 and authorizes an additional $5 billion in commitment authority for the FHA to finance apartment, hospital and health care facilities that serve millions of Americans. The legislation, which passed the House the previous week, was to be signed into law by President Obama in short order.

For several weeks, NAHB and a coalition of multifamily and health care industry organizations had urged Congress to move quickly on this issue to ensure the FHA would not have to shut down its multifamily and health insurance programs before the end of the fiscal year on Sept. 30.

The FHA recently notified Congress that it had exceeded 75% of its commitment authority to insure mortgages under the General Insurance and Special Risk Insurance (GI/SRI) Fund. FHA Commissioner David Stevens warned that without an additional $5 billion in commitment authority to meet this year’s expected loan demand, the fund would be exhausted by late August or September.

Last month, NAHB organized a letter from 22 industry groups urging the House to support H.R. 5872. “FHA is now facing the real possibility that it will have to shut down the multifamily and health care insurance programs,” the letter said. “Without swift passage of H.R. 5872, needed affordable rental housing and health care facilities could be at risk of losing time-sensitive financing and subsidy commitments. We cannot afford a suspension of these important programs now.”

After the House approved the bill on July 28, NAHB reached out to key Senate members and staff, urging them to support the measure and pass it before the Senate adjourned for its August recess.

To view the legislation, click here and type H.R. 5872 in the box at the upper center of the page.

For more information, e-mail Claudia Kedda at NAHB, or call her at 800-368-5242 x8352.

Congress Ensures Funding for Key Rural Housing Program

With funding for a key rural housing program nearly depleted, Congress recently approved legislation to ensure that home buyers in rural areas have continued access to affordable mortgages through the U.S. Department of Agriculture (USDA) 502 loan guarantee program.

An NAHB-supported provision to give the USDA the authority to increase the upfront premium for 502 guarantees — making the program self-sustaining at no cost to the American taxpayer and providing families in rural communities with a vital source of mortgage credit — was included in a broader $58.8 billion supplemental bill (H.R. 4899) to pay for the wars in Afghanistan and Iraq and provide emergency funding for other programs.

NAHB lobbied on behalf of this important rural housing program for several months, and urged Congress to finalize the legislative fixes needed to put the program back on a solid financial footing.

The program guarantees loans to applicants who have incomes no higher than 115% of the median income for the area. The loans are funded by private lenders and can be used to build, buy, repair or renovate homes.

As a result of the current mortgage credit crisis, demand for the loans has spiked since 2006 and the number made annually has tripled, depleting current federal funding.

The legislation will correct the funding shortfall by enabling the Section 502 Single Family Housing Guaranteed Loan program to pay for itself, rather than relying on federal funding. It will allow participating lenders to increase their current 2% fee on mortgages to as high as 3.5% and allow an annual fee of up to 0.5% on the balance of the loan.

To read the legislation, click here and enter H.R. 4899 in the box at the upper center of the page.

House Passes Transportation-HUD Appropriations Bill

The House recently voted to approve its fiscal 2011 Transportation and Housing and Urban Development (HUD) Appropriations bill (H.R. 5850), the second of 12 spending measures the chamber will consider to fund the operations of the federal government.

Of interest to NAHB members are funding levels for some key federal programs, including:

With the new fiscal year beginning on Oct. 1, the Senate is not expected to approve any domestic appropriations bills until mid-September at the earliest. It is possible that Congress will approve a continuing resolution at that time to temporarily keep the government running past the beginning of the new fiscal year, and later enact a giant omnibus spending measure during a lame duck session of Congress.

The House-passed fiscal 2011 Transportation-HUD bill is likely to serve as a template for the housing funding levels in any year-end omnibus package.

To view the legislation, click here and enter H.R. 5850 in the box at the upper center of the page.

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

Banks Provide Many Alternative Routes for Settling Debts

By David McCain and Bill Albers, MPKA, LLC
(This is the second in a series on what builders need to know about restructuring debt and planning for surviving financial adversity in today’s real estate market.)

You have made the decision to hire a debt restructure specialist, and the process begins.

Your initial consultation will include spending several hours discussing your projects, company, debt and finances.

Be prepared to share large volumes of documents, including: loan documents, appraisals, tax returns and financial statements for all borrowers and guarantors, contingent liability schedules, developer schedules, global cash flow statements, historical financial statements, cash flow statements and balance sheets, historical unit activity, projected unit activity, copies of all bank communications, and, if there is any, a summary of litigation and its status.

You can also expect the specialist to insist on visiting and inspecting your projects to really understand your business.

The specialist will next tell you what you can reasonably expect. Possible outcomes are discussed below.

The debt restructure specialist will then initiate communication with the bank, first building credibility; then educating the bank about the true value of the project and the financial capacity of the guarantor; and next determining what the bank needs, whether it wants cash, performing loans or taking title.

The remaining negotiations will largely be spent structuring a transaction and price that is acceptable to the bank, and, most importantly, arranging the capital to make the transaction work. The best negotiated transaction is worth nothing without the capital in place to execute it. This will include soliciting offers from potential purchasers of the note to determine the accuracy of the most recent bank appraisal.

From the time you hire a debt restructure specialist to the time you reach a settlement can take as little as 60 days or as long as a year, but the process is typically completed within three to six months. The specialist will want to proceed as expeditiously as possible.

It is helpful during this phase for the borrower or a financial officer on the staff to be standing by to answer questions.

Your specialist will be negotiating with the bank on the financial capacity of the guarantor to contribute toward any potential deficiency. Payment toward the deficiency can take many forms, such as cash, unsecured notes, liens or pledges on other collateral, transfer of title to other property, cars, other items or combinations of these. Of course, there are many instances where there will be no contribution toward a deficiency.

Most debt restructure specialists work for a modest, hourly fee for overhead and a contingent fee that is typically based on a percentage of the amount of debt or personal guaranty forgiveness the specialist succeeds in obtaining during the negotiations.

These are the basic methods of restructuring debt, each with several offshoots and variables:

The next article in this series will examine actual case studies of recently transacted deals.

To read the previous article in this series, “Debt Restructuring Helping Builders Survive Today’s Financial Crisis," click here.

David McCain and Bill Albers are the principals of MPKA, LLC. They have successfully restructured more than $1 billion worth of home builder and developer debt over the last 24 months. They can be reached at david.mccain@mpka.com, 305-439-7051, and bill.albers@mpka.com, 214-219-1288, or by visiting www.mpka.com.

Eye on the Economy: Moderately Faster Economic and Job Growth Lies Ahead

The economy continued to grow in the second quarter, slowing down from previous quarters and not as fast as economists would like to see it, but it was growth nevertheless, with gross domestic product (GDP) advancing at an annual rate of 2.4%, its fourth consecutive quarterly increase.

GDP grew in this year’s first quarter at a 3.7% pace and in the fourth quarter of 2009 at 5.0%. The concern that this cool down presages a double dip and return to recession seems to be overblown.

First, it is not unusual to see variations in quarterly GDP growth coming out of a recession. Particularly strong quarters are often followed by weaker ones as growth in sectors responsible for the surge begins to moderate.

Second, although consumers are rebuilding their savings, they are also spending and likely to continue spending.

Third, business investment may be weakening, but it will continue to advance as companies move to take advantage of low interest rates.

Fourth, the federal government is still distributing funds provided under the American Recovery and Reinvestment Act (ARRA). A large share of these funds has been stockpiled by states, which are slowly using them to pay their vendors over time.

Buoyed by the home buyer tax credit, residential construction helped lift GDP in the second quarter, adding 0.6% to the overall growth rate, thanks to improvements in single-family activity and remodeling, with multifamily construction a negative. This was the first positive contribution from this sector since it added 0.25% to growth in the third quarter of 2009, which was the first quarter in two-and-a-half years that home building was not a drag on GDP, a grim reminder of the depth and length of the housing downturn.

Second quarter GDP also received a major boost from business investment in equipment and software, a sign that firms are generally positive about their future prospects.

Companies also continued to build their inventories, another positive for growth, although at a slower pace than in the previous two quarters. The lift from inventory investment will disappear, however, if final demand falters.

The consumer remains cautious, but has not abandoned the marketplace, contributing roughly half of the growth recorded in the second quarter, down from a two-thirds share in normal times. For now, consumers seem unlikely to increase spending given their generally glum outlook.

The University of Michigan Consumer Sentiment Index fell from 76.0 in June to 67.8 in July, its lowest reading since November. The Conference Board reported a similar drop in its July Consumer Confidence Index, which dropped from 54.3 to 50.4 , its second consecutive monthly decline.

While it is encouraging that businesses and consumers are still active participants in the economy, their growing expenditures in the second quarter led to a large increase in imports, which reduces GDP growth, and this was only partially offset by rising exports.

Ongoing spending by businesses, consumers and the government will produce sufficient economic growth to spur more hiring, which in turn will further buttress consumer spending and aid in housing’s recovery.

As a result, NAHB is forecasting moderately faster economic and job growth over the next few quarters.

Getting a good read on housing has been complicated in recent months by the lingering effects of the home buyer tax credit and its expiration. The tax credit pulled sales forward as buyers sought to qualify for the credit before the deadline for signing a sales contract at the end of April, leaving the pool of prospective home buyers severely depleted.

Now there is early evidence that market demand is in the process of being restored by historically low mortgage rates and affordable house prices.

New home sales peaked in April at a seasonally adjusted annual rate of 422,000, their highest level since September 2008. In May, they fell precipitously to 267,000, their lowest level since the Census Bureau started reporting these figures in 1963.

Sales in June rebounded to 330,000, an indication that buyers are returning to the market. Although this was a healthy increase, it still left sales at the second lowest level ever recorded. NAHB is forecasting further improvement in coming months as mortgage rates remain low, house prices level out and job growth continues.

Meanwhile, the inventory of new homes fell to 232,000 in June, a level last seen in 1968. Since then, the number of U.S. households has grown by more than 90%. As demand returns, a larger inventory will be clearly needed and this bodes well for residential construction, dependent upon banks increasing their lending to builders again.

Since their recent peak of 5.06 million In April, sales of existing single-family homes declined 1.6% to 4.98 million in May and 5.6% to 4.7 million in June. This was a bit surprising since the closing deadline to qualify for the tax credit was originally June 30.

The argument for extending the deadline to Sept. 30 was that a crush of credit-related sales had led to a backup and pushed closings beyond June. If this is what actually occurred, then it is a possible explanation for the sales decline in June and it suggests that existing home sales should not deteriorate further in July and August as the marketplace adjusts to the fading tax credit.

The National Association of Realtors® (NAR) Pending Home Sales Index, which is comparable to new home sales since it is based on contract signings, plunged 29.9% in May and fell an additional 2.6% in June. The index was down 18.6% from a year earlier, roughly in line with a 16.7% year-over-year decline in new home sales in June.

These declines represent the expected adjustment to the expiration of the home buyer tax credit. As we move beyond the tax credit, the true picture of the underlying market will begin to emerge by July or August.

Aided by the home buyer tax credit, house prices have stabilized and begun to inch up. The S&P/Case-Shiller 20-city price index has risen in 10 of the last 12 months. On a year-over-year basis, the May index was up 4.6%.

Further, 19 of the 20 cities saw an increase in prices from the previous month on a non-seasonally adjusted basis. Thirteen of the 20 were up on a year-over-year basis, with three of them — San Diego, San Francisco and Minneapolis — up by double digits.

Not quite as rosy, the Federal Housing Finance Agency (FHFA) price index has been up in each of the last three months, although the May index was down 1.1% from a year earlier. Prices were up in seven of the nine divisions of the country in May, but only two were up on a year-over-year basis.

June median new home prices were down a modest 0.6% from a year earlier, while June median single-family existing home prices rose 1.3%.

At a minimum, the home buyer tax credit has helped stabilize home prices and may have given them a bit of a lift.

NAHB is forecasting that house prices will exhibit a mild upward slant during the remainder of this year and throughout next year.

The combination of the home buyer tax credit, low interest rates and an improving employment picture lifted the value of single-family construction put in place on a year-over-year basis for five straight months through June, when it was up 26.7%. At a seasonally adjusted annual rate, the measure rose for 12 consecutive months until June, when it fell 0.7%, undoubtedly showing the waning effects of the home buyer tax credit.

Multifamily construction spending, on the other hand, showed its first signs of life in June, rising 0.3%, although still down a hefty 52.0% from a year earlier, supporting NAHB’s view that it is bouncing along the bottom as the industry continues to struggle with high vacancy rates and the paucity of financing for new projects. Multifamily construction should be stable for the balance of the year and gradually climb in 2011.

The Census Bureau reported that the nation’s rate of homeownership slipped from 67.2% in this year’s first quarter to 66.9% in the second quarter, its lowest level since the fourth quarter of 1999, a result of foreclosures and continued uncertainty surrounding the housing market.

Homeownership stood at 67.2% in the second quarter of last year. Over the ensuing year, it actually rose in the Midwest — from 70.5% to 70.8% — while in the Northeast it fell slightly from 64.3% to 64.2%. The worst declines — from 70.0% to 69.1% in the South and 62.5% to 61.4% in the West — occurred in regions with the highest foreclosures..

Over the same period, the stock of year-round vacant homes for sale edged up to 1.97 million from 1.9 million. This was an improvement over 2008’s average of 2.23 million, suggesting that this may only be a temporary setback.

Unfortunately, the same cannot be said for the stock of year-round vacant units for rent, which rose to 4.44 million from 4.38 million a year earlier. The large number of available rental units has put downward pressure on rents and dampened financing for the construction of new multifamily rental properties.

NAHB Chief Economist David Crowe 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 Aug. 4 edition. To subscribe to “Eye on the Economy,” click here.

Useful Links to Monitor Economic and Housing Trends

The following are links to useful information from government agencies and NAHB that will enable you to monitor the housing market.

New IRS Reporting Requirements a Costly Burden on Small Businesses

NAHB members, and their accounting and tax professional contacts, are being asked to submit comments and recommendations on new information reporting requirements from the Internal Revenue Service that will go into effect in 2012.

Included in recently enacted health reform legislation — The Patient Protection and Affordable Care Act of 2010 — the change is expected to increase the paperwork requirements of most businesses in the country.

Creating a new class of transactions that must be reported to the IRS, the new law will require all businesses to file information returns — generally on IRS Form 1099 — for entities to which they made payments of more than $600 in a given year.

NAHB has opposed this provision as a costly and unfair administrative burden, particularly for small businesses, that will be ineffective in raising government revenue.

NAHB is part of a broad coalition of dozens of pro-business organizations working to repeal this requirement. Legislation that would accomplish this — the Small Business Paperwork Mandate Elimination Act — has been introduced in the House (H.R. 5141) by Rep. Dan Lungren (R-Calif.) and in the Senate (S. 3578) by Sen. Mike Johanns (R-Neb.).

On behalf of the residential construction sector, NAHB will be submitting comments to the Department of the Treasury late this month once again voicing opposition to the statute, but also making technical recommendations to reduce the administrative burden of the rule. A response will also be sent to the IRS. Submissions from the association’s membership will be included in the NAHB statement.

E-mail suggested technical recommendations to Robert Dietz at NAHB, or call him at 800-368-5242 x8285.

Online registration is now open for the 2011 NAHB International Builders’ Show (IBS) in Orlando on Jan. 12-15 — the single, most important and largest industry event of the year.

Industry professionals who register for the show by Aug. 31 can take advantage of heavily discounted registration pricing (four days of exhibits and education), saving $100 on early-bird registration and $130 on regular registration.

Another option for NAHB members who register during August is a free four-day pass to the exhibit floor.

In addition, spouses of members and non-members can register for free in August.

The NAHB Finance Pavilion — which will give NAHB members the opportunity to meet individually with a variety of capital sources and financing advisors to explore financing solutions for their projects through debt and equity positions, joint ventures and partnerships and traditional sources of housing credit — returns to IBS and is open only to members who purchase the $50 Pavilion upgrade to their full IBS registration.

These attendees will have access to the Pavilion all four days of the show and will receive an invitation to an exclusive Finance Pavilion-only networking event to be held during the show.

Enter NAHB Star! Talent Contest by Sept. 15 to Sing the National Anthem at IBS 2011 in Orlando

NAHB members and their immediate family members are invited to enter the NAHB Star! talent contest — the popular “American Idol” and online voting-style competition to find the NAHB member or family member who can best belt out the national anthem to kick off the 2011 NAHB International Builders’ Show in Orlando on Jan. 12-15.

To enter, contestants should submit entry forms and audition videos of a cappella performances of "The Star-Spangled Banner" to nahbstarinfo@gmail.com by Sept. 15.

Their videos will then be posted on the IBS website, www.BuildersShow.com, where the NAHB family and general public will have from Oct. 12-29 to vote for their favorite performance.

NAHB will announce the top four finalists on Nov. 2 and then fly them to Orlando for final judging just prior to the Builders’ Show. The winner will sing the national anthem during the Grand Opening Ceremonies on Wednesday, Jan. 12.

In addition, the local home builders associations that are connected to the finalists will also receive prizes and recognition.

Spokesperson Training will not be offered at the NAHB Fall Board of Directors Meeting in New York.

Members can now register securely online with a credit card for one or both of the Spokesperson Training sessions — Interview Skills and Presentation Skills — on the NAHB website.

In the Interview Skills session, NAHB members will learn how to give clear, concise answers while in a high-pressure, spur-of-the moment interview. The training also will help participants master strategies for broadcast and print interviews, including message development.

Members attending the Presentation Skills session will learn how to confidently prepare and deliver dynamic presentations to any audience. The session focuses on how to organize and deliver a speech and presentation, with accompanying question and answer sessions.

Each one-day session is from 9:00 a.m.-4:00 p.m. Registration is limited to 12 participants.

Each session is led by professional communication consultants who have more than 30 years of experience training NAHB members on the critical issues they face every day.

More than 15,000 NAHB leaders have taken Spokesperson Training since the program began in 1979.

For more information, e-mail Brooke Fishel at NAHB, or call her at 800-368-5242 x8061.

Builders’ Tip: Modified Sawhorses Make Great Drying Racks

I was painting several shelves by supporting them on a pair of sawhorses when I ran out of space for the shelves to dry.

When it came time to paint the shelves on their flip sides, I wanted to avoid resting the newly painted shelf surfaces across the entire 5 1/2-inch width of the sawhorse crossbars.

As shown in the accompanying drawing, I solved both problems by screwing a 6-foot 1x6 to the side of each sawhorse.

This enabled me to reduce the contact surfaces from 5 1/2 inches to about 1/16 inch — and the long 1x6s gave me a lot more room to rest the shelves as they dried.

Presented in a virtual format as part of the NAHB BuilderBooks effort to go green and streamline delivery, the catalog includes publications and products to help building industry professionals ramp up for a successful year as the industry and the economy begin to recover.

The materials in the catalog, written by industry leaders in various fields of residential construction, feature publications and products about accounting, estimating, business management, green building, sales and marketing, safety, construction codes, 50+ housing, multifamily housing, construction management remodeling and more.

Pssst. Sell More Active Adult Homes by Featuring Beautiful Basics, Fewer Frills

Sell more single-family homes to the active adult market by value engineering your designs with beautiful basics and fewer frills. Just don’t tell anyone.

This market segment, while changing, remains steadfast in its demands, so you need to offer your prospective buyers everything they want. If not, they simply won’t buy from you because they don’t have to.

As they have demonstrated during the last half-dozen recessions — and even in good times — prospective buyers in the active adult market are in no rush to buy and can usually stay put until they find what they want.

So, to help get them off the fence, don’t include elements in your homes or community that your buyers never really had to have in the first place.

The typical active adult buyers of single-family homes, while wanting everything, seem to have some basic demands.

They generally want two bedrooms — plus. The “plus room” can be shown as a den — that can easily be converted into a bedroom or exercise room — or as an actual third bedroom.

Your younger empty-nester might accept the second or third bedrooms on a second floor, but don’t offer that to your older active adult buyers. Position everything on the first floor for them — at almost any cost.

Two critical areas that can benefit from value engineering and improve your cost-to-build include room types and room count.

Offer your more formal buyers a formal living/dining room. But for your casual lifestyle buyers, eliminate the living room and, possibly, the dining room. Instead, provide a large, open great room. A flex room for formal dining, living or use as a den will appeal to these buyers and can eliminate up to 150 square feet without disappointing them.

Other obvious ways to subtly value engineer your current designs include: reducing hallway space; reducing wasted space such as unusable areas and spaces that can’t be furnished; using window placement to make smaller rooms appear larger; using 9-foot ceilings instead of vaulted ceilings; including some high glass; shrinking the master bath by including a larger shower instead of an oversized tub; and providing double-use spaces such as hallways that, when necessary, can serve as art galleries or work spaces.

A less complicated floor plan can reduce your cost-to-build as well. That doesn’t mean your plan should be a box. However, to achieve maximum effect from your street elevations, consider putting your offsets at the front of your plans.

Front porches play a big role in the boxy floor plans that we create. We have found that buyers will choose to add porches to a home when they won’t necessarily choose overly complicated plans.

Similarly, active adult buyers will choose other options to enhance their lifestyle, so value engineering should tap into this opportunity by allowing for pre-planned sunrooms, expanded rooms, basements and second floors in addition to porches.

Essentially, with value engineering, make sure the standard design works for your buyers, then option the add-ons and extras.

The following floor plans and elevations depict several possibilities. If you know your buyers, their lifestyle and needs and price constraints, you can adjust your plan accordingly.

With the following plan, a 2,400-square-foot home was value engineered to 1,800 square feet without giving up the have-to-have items that buyers expected.

The original plan features three bedrooms, a formal living room and dining room, two floors and more. Click for larger image.

The value engineered plan retains the charm and have-to-have features but eliminates excess rooms and space and reduces cost-to-build. Click for larger image.

Elevations are one element of a home where active adult buyers enable builders and architects to cut costs.

Features such as overly complex roof structures, gables on hips on gables, high front-to-back roof lines and extensive use of expensive materials and detail are not necessary to make the sale. While you should not pare your floor plans to their absolute basics, you can simplify while still appealing to your buyers.

Concentrate on developing and keeping “character” in your product, even if it means limiting your stone or brick accents. You want to provide just enough detail to bring the warmth to your streetscape that your buyer insists upon.

Active adult buyers don’t want to be perceived as stepping down in prestige. They want to move into a house and community that more than meets — and expresses — their lifestyle needs.

You can achieve this by paying attention to details in the front door area as well as through window placement, an entry porch and, possibly, even a dormer. These types of details can make a one-story home feel more impressive. Also, consider adding a “feature” window in the front elevation.

The originally designed elevation is complex and too costly for today's market. Click for larger image.

The elevation is value engineered to reduce the complexity while retaining curb appeal. Click for larger image.

You will most likely still need to provide a clubhouse in your community, either up-front or as soon as possible when appealing to this market. But you can value engineer your clubhouse without diminishing its appeal to your prospective buyers.

First, consider whether or not to include an indoor pool. When including a pool, you should expect to build a clubhouse of at least 8,500 square feet to 9,500 square feet. Without one, you can conceivably offer a clubhouse of 7,000 square feet, or maybe even less, if you have to.

Keep your cost-to-build and cost-to-maintain in mind when designing the clubhouse. Focus on a few social and fitness activities and design the clubhouse so that elegance trumps square footage. Be imaginative and, as with your house plans, make the minimal feel gracious.

“Location, location, location” — one axiom we lost track of these past few years — is still important to these prospective buyers.

Do your homework to determine whether prospective buyers in your community want to be within a few miles and within easy access of a city or amenity, close to their children and grandchildren or near required facilities. Find out where they want to live, rather than just building an active adult community where you can get it approved.

The active adult market is changing dramatically. The age-restricted community may not have the broad appeal it once did. Younger retirees may be more inclined to want to stay within their existing community fabric.

I don’t believe that the larger, restricted communities will disappear, but they will attract a smaller percentage of the market — and that can be good news for the industry.

It means that more active adult products and communities in a variety of sizes can be built in cities and inner suburbs, as well as in their more traditional locations as builders continue to learn more about universal design and how to better design for an active adult market.

Yes, the active adult market won’t compromise much, but the return of baby boomers to the market in large numbers presents many new opportunities. In addition, many of us in the industry have the instincts and have conducted the research to provide what our market wants and, just as importantly, the flexibility to change as their needs and wants change.

So keep looking at your product and your buyers and keep trying to produce the value engineering that active adult buyers need and want — without taking out the essentials.

William J. Devereaux, Jr. is the president of Devereaux & Associates, P.C., a McLean, Va.-based architecture and planning firm. Devereaux has been involved in the design of thousands of active adult and 50+ housing — including land planning and clubhouse design — throughout the East Coast for the more than 35 years. For more information, e-mail queries@deverauxarch.com, call him at 703-893-0102, or visit the company’s website at www.devereauxarch.com.

“Universal Design for the Home,” available through NAHB BuilderBooks, features a blend of projects, creative ideas and substantive planning information for incorporating universal design.

Highly visual, the book features projects showing room contexts and photos of details. Basic specifications, how-to tips and other technical content are featured throughout the book in easy-to-find boxes and sidebars.

Author Margaret A. Wylde guides readers through the latest survey results on this important consumer group and explains what their responses mean for today’s and tomorrow’s home building industry.

How to Build Branding and Credibility and Gain Referrals, Repeat Business in Return

At a time when home buyers have more choices than ever, prices are competitive across the board and there is an oversupply of product in many markets, smart builders are keeping a close eye on their overall image, credibility and the value of their brand.

Today, builder branding and the fundamental qualities that create a positive brand are important because they create an overall positive first impression that can help a builder stand out in an active marketplace.

Prospects visit a builder website or see community signage, enter the sales center, read company and community literature, meet a sales representative and process an initial impression very quickly. That’s where their brand impression begins.

From that point on, builders need to concentrate on what the brand does best for their customers — not for their own bottom line. That approach will ring true and create positive customer associations that not only influence the buying decision, but encourage valuable repeat business and referrals.

A prospect’s first encounter with an employee, typically the sales representative, is critical to builder branding because that employee is the builder in the eyes of the customer.

Here employee morale and perspective is critical. Has the builder created a work environment that values personal initiative along with corporate loyalty? Does the on-site team — sales, construction and customer care personnel — feel properly treated, respected and compensated?

These questions, while obvious, point out the fundamentals on which a builder’s brand is established. If employees believe they are an integral part of the process of building and selling homes, they will communicate that enthusiasm to buyers. If they believe they are more than just cogs in a machine chugging toward more profits, they will want to create a great first impression and act as ambassadors for the brand.

When marketing a positive builder brand, third-party customer service surveys also are an important and credible element. Consumer research companies such as Eliant provide a valuable perspective on how a builder is performing with customers by surveying home buyers at several steps throughout the home buying process — and even long after the purchase has closed.

These surveys can also be conducted by in-house representatives. However outsourcing the research offers a level of accuracy that internal surveys can often miss. Survey results by independent companies are indisputable and create a true picture of the kind of job a builder is doing.

Home and community features are another area where the right customer-conscious choices can help improve a builder’s brand.

Environmentally responsible building, for example, is a growing priority across the country, and while builders benefit when buyers choose green options, buyers also have the opportunity to make responsible choices that demonstrate a commitment to their family’s health and the future of the planet. At MBK Homes in California, green features have been unified under a single brand, LifeWise, to help communicate their value to prospects.

More than anything else, what buyers appreciate from their builder is good value for the money — and the perception of value is a powerful attribute to attach to a brand.

Offering the right mix of flooring options at a competitive price is a major selling point at MBK Homes. The company and its flooring partners established prices that are more competitive than what a home buyer would pay for a comparable product from a big box retailer, enabling buyers to purchase a higher grade of flooring than they would have expected.

That also is the type of solid, tangible value that a builder can provide to customers. It also can improve customer ratings and enhance the brand image.

Successful branding has to be more than just a builder’s name on a contract. It takes a dedicated group of industry professionals supporting an exceptional brand.

MBK has been able to improve its customer satisfaction and reputation by assembling teams for each of its developments that bring together key personnel — a representative from sales, customer care, the lender, flooring designer, escrow and the project’s superintendent. Buyers can meet team members before the building process begins and attend occasional update meetings over the course of the escrow period. This process enables prospects to experience one-on-one customer service.

In home building, best practices speak for themselves. The only way to expect a referral or repeat business is to consistently do the right thing for customers. Creating a strong, worthwhile brand goes beyond the bottom line and straight to providing value and exceptional service to customers — which, in turn, helps drive sales and referrals.

Rick Fletcher, vice president of sales and marketing for MBK Homes in Southern California, is responsible for developing and managing the company's sales and marketing operations, including maximizing sales volume and revenues, executing a comprehensive community-specific and corporate marketing plan, staying within established budgets and maintaining an exceptional level of customer satisfaction. He has received numerous industry professional awards, including “Sales Director and Marketing Director of the Year.” For more information, e-mail Fletcher, call him at 949-789-8300 or visit the MKB Homes website at www.mbkhomes.com.

Learn how to use social media sites to build your brand, engage new and existing consumers, manage your online reputation and sell more homes.

The book covers everything from the home buying process and new home financing to strategies for making better sales presentations and sizing up the competition. It teaches readers how to overcome customers’ concerns and provides specific examples of how to explain the benefits of new home features in customer-friendly language.

“Think Sold” provides insights on how to approach sales and life from a position of optimism that will create successful outcomes; how to improve upon potential customer prospecting and follow-up skills; and how to communicate effectively with various types of buyers and learn how to adjust communication strategies to increase rapport and alignment with buyers’ motives.

For additional cutting-edge sales and marketing information, subscribe to NAHB’s Sales + Marketing Ideas magazine (www.smimagazine.com).

Click here to learn about membership benefits of the National Sales and Marketing Council and the Institute of Residential Marketing.

A New Reality for Creating Successful Residential Communities

The entrance to the Ross Bridge community near Birmingham, Ala., clearly delineates the area as its own community.

In the last few years, land values have plummeted, often below the cost of improvements to that land. Acquisition, development and construction (AD&C) financing is virtually unobtainable and, when it can be found, the terms are overly restrictive.

Also, the impact of what many believe will be a forthcoming commercial real estate debacle may well result in an even scarcer supply of funds for residential development and home building for the next several years. Even when they are able to do so, many small- and medium-sized builders are unwilling to finance the purchase of improved home sites.

Although the worst of the housing downturn appears over for most markets, and signs of recovery are showing, the next few years will remain difficult for the home-building industry and the strongest impact of these challenges will fall on the development side of the business.

The baby boomers, whoh have been the major drivers of housing demand for the past 40 years, have pretty much run their course regarding conventional housing. The country has more than sufficient amounts of move-up product, and the additional homeownership opportunities for this market segment may be mostly limited to the active-adult (55+) communities.

Even given these opportunities, the continuing impact of foreclosures, recent substantial reductions in existing home values across the country and the lasting psychological impact of property value declines will influence the purchasing patterns of these consumers.

Demographics suggest that the 75 to 80 million millennials — the term they prefer over echo boomers or Generation Y — will, in time, more than replace their parents’ generation in population size and housing market demand and become the next major driver of that demand.

These potential purchasers are relatively free from feeling the effects of recent home value declines. However, the current economic conditions — and the ever-tightening grip on credit — will make it difficult for them to match the homeownership rates of their predecessors by the time they reach their 30s and 40s. Also, they are substantially different from the preceding generations of home buyers.

For one thing, millennials are experiential — they are more interested in doing than in having. Their time is important to them, which is evidenced by their constant multi-tasking and demand for instant communication.

This generation exists to a great extent in a virtual world and they are less likely to join structured organizations or require physical facilities. They also are far more socially responsible and socially and politically liberal.

Plus, they are far less likely to respond to a “luxury” appeal and are careful shoppers. They extensively research products before purchasing and delving into details and background.

Offering a variety of products will play an important role moving forward. Home in the Ross Bridge community range from the $200,000s to custom-built million-dollar homes.

The impact of the current financial realities coupled with changes in demand requires that we adjust our supply side.

Quite simply, much of what we did in the past to create successful residential developments will not work today.

As most of us in the development industry know, housing demand cannot be created. All we can do is manage and, hopefully, satisfy existing demand.

To create successful residential developments, we must design communities that are optimized toward satisfying that demand — which remains quantifiable by location, price, lifestyle, product type and uses and the rate of absorption.

And we must remember, again, that developments inherently have no value unless and until we can sell the homes to be built there.

The final land value, regardless of cost or risk, is only a residual of the sale price of the housing, and that has substantial impact on existing developments as well as on ground already acquired for possible new building.

If we build a better mousetrap — a superior community environment that addresses the needs, wants and desires of the viable target home-buying markets — then consumers will purchase homes and the price of the home site to our customers, the home builders, becomes secondary.

In one market where I am involved, for example, housing prices have declined and new home sales are down by more than 50%. Yet one community, Ross Bridge hear Birmingham, Ala., has seen its market share increase from 3.6% in 2007 to 5.7% in 2008 to an amazing 14.2% in 2009. The community continues to sell new homes and is able to sell home sites to builders without needing to adjust home-site pricing.

The community was well strategized, well designed and well implemented with multiple builders serving multiple markets, enabling the community to appeal to first-time buyers and first- and second-level move-ups. And even though Ross Bridge was not immune to economy strains — several custom builders folded — excellent hands-on sales and marketing management minimized the impact.

To read the entire article and Levitan’s suggestions regarding land acquisition, new development strategy and repositioning or redeveloping existing communities, subscribe to NAHB’s Land Development Magazine.

Unavailability of Inexpensive Test Kits Pushes Cost of EPA Lead Paint Rule Higher

A new NAHB economic analysis of the costs associated with the Lead: Renovation, Repair and Painting rule shows why the rule — intended to protect young children from the significant hazards of lead paint exposure — is even more likely to backfire.

The NAHB findings — which are included in new comments from the association filed on Aug. 6 on the U.S. Environmental Protection Agency’s proposed clearance testing rule — follows an announcement by the agency that more accurate, inexpensive lead paint test kits will not be available anytime soon. The kits were expected to be ready by next month and were seen as key to keeping the lead paint rule affordable for home owners.

NAHB is also looking at the revised lead hazard standard that the EPA is now preparing for residential buildings and the new lead hazard standard for commercial and public buildings.

The agency has formed a Science Advisory Board to review proposals for the standard. To determine whether any members of this board may have a conflict of interest or may not be impartial, NAHB has made a Freedom of Information request to the EPA for records, correspondence and other paperwork of the advisory staff.

The new lead paint rule is expected to have a significant impact on the nation’s remodeling market, with repercussions for jobs, wages and tax revenue.

For example, NAHB Economics found that the cost of the lead-safe work practices and third-party lead-paint testing just for window replacements — a common renovation project — in all pre-1978 homes would result in:

“This is a classic case of good intentions resulting in unintended consequences,” said NAHB Remodelers Chair Donna Shirey, a remodeler in Issaquah, Wash.

“We’ll have more and more consumers who understandably balk at the higher costs of hiring an EPA-certified renovator and either do the work themselves or don’t do it at all, even if their homes have lead paint. I think the public health consequences could be quite significant,” she said.

The EPA’s economic analysis found that the cost of the work practices would be about $35 per job, averaging the costs of all jobs with those in which lead-safe work practices would be required and assuming the availability of an accurate, off-the-shelf kit that could check for the presence of lead paint for about $2 per test.

With the tests unavailable, consumers are left with more expensive methods to check for lead. Otherwise, the remodeler must assume that lead is present — even in homes built between 1960 and 1978, only 25% of which contain lead paint according to government estimates.

“That means that 75% of those consumers will have to pay for the rule, yet they get no benefit,” Shirey pointed out.

The lead rule requires remodelers, window installers and other contractors who work in housing and child-occupied facilities built before 1978 to use lead-safe work practices unless those homes are tested and found free of any lead paint.

Renovations in homes built before 1978 that affect painted surfaces measuring at least 6 square feet (or 20 square feet outside) must be managed by a certified renovator who has completed EPA-approved training and is employed by an EPA-certified firm.

Certified renovators complete EPA-approved training and submit a form and $300 to the EPA to become a certified firm. The certified renovator must then follow work practices stipulated in the rule, including containing and controlling the dust, cleaning up after the work, using a wet wipe to confirm the cleaning and maintaining careful records of each job for at least three years.

All renovators must provide their customers with the EPA’s “Renovate Right” brochure before starting work in pre-1978 housing.

The lack of a reliable, inexpensive test kit means that the economic assumptions that EPA has made in subsequent rulemakings — including the upcoming clearance testing requirement — must be rethought.

“NAHB fully expects that the EPA will issue a revised cost estimate for lead-safe work practices and take steps to raise consumer awareness of this issue,” Shirey said.

In its Aug. 6 comments, besides pointing out the increased cost for window replacement, NAHB clarified and expanded its earlier comments on dust-wipe sampling procedures, the physical condition of tested surfaces and the agency’s proposal to allow certified renovators to collect paint chip samples prior to remodeling.

For more information, e-mail Kelly Mack at NAHB, or call her at 800-368-5242 x8451.

The publication includes a CD containing 160 essential forms and documents — culled from successful remodelers across the country — that you can customize to suit your business needs.

'How to Find a Professional Remodeler' Brochures Available at BuilderBooks.com

"How to Find a Professional Remodeler," available at NAHB BuilderBooks, promotes the professionalism of your remodeling business by offering a wealth of valuable advice to customers on the process of selecting a remodeler.

The newly updated brochure highlights the before and after photos of the most frequently remolded rooms in the house.

Remodelers See Dip in Second Quarter, But Early Recovery Stages Nearing

Remodelers saw market conditions worsen in this year’s second quarter, according to the latest NAHB Remodeling Market Index (RMI).

From the first to the second quarter of this year, components of the RMI measuring remodelers’ assessment of current and future market indicators combined fell from 47.9 to 40.7. Current market conditions dropped from 44.5 to 42.6 and future indicators slumped from 43.1 to 38.9.

The RMI measures market demand for current and future residential remodeling projects based on remodelers’ perceptions and indicators of future activity like calls for bids. On a scale of one to 100, any number below 50 indicates that more remodelers say conditions are negative than positive.

The RMI has been running below 50 since the final quarter of 2005, although it was approaching the break-even point in this year’s first quarter.

“Remodelers are suffering from weak consumer confidence and constricted credit lines,” said NAHB Remodelers Chair Donna Shirey, CGR, CAPS, CGP, a remodeler from Issaquah, Wash. “Home owners are delaying remodeling projects because of economic uncertainty.”

Current conditions worsened in the second quarter in the Northeast and South, where the index dropped from 46.6 to 41.4 and from 44.1 to 42.4, respectively. That index climbed from 43.8 to 44.7 in the Midwest and from 34.8 to 42.0 in the West.

Quarter to quarter, major additions skidded from 48.0 to 44.2, minor additions fell from 47.3 to 45.8 and maintenance and repairs dropped from 37.3 to 36.6.

All component indices of future remodeling business were lower in the second quarter than in the first, with calls for bids sliding from 49.4 to 46.2, work committed for the next three months from 29.9 to 27.9, the backlog of remodeling jobs from 44.8 to 37.7 and appointments for proposals from 48.1 to 43.7.

Responding to special survey questions on the changing composition of remodeling projects, 61% of the remodelers said bathroom remodeling was one of their most common projects during the first half of 2010, followed by kitchen remodels, at 52%. In previous years, more than 70% of the respondents said that kitchen remodeling was their most common activity.

In general, survey results show that larger remodeling projects — such as room additions, whole-house remodeling, bathroom additions and second-story additions — have been trailing down for several years. At the same time, smaller remodeling jobs — such as window and door replacement — have remained relatively steady, or, in the case of handyman services, have actually increased.

Only 29% of remodelers reported that room additions were a common activity in 2010, down sharply from 70% in 2004. Conversely, one-third of the remodelers were regularly doing handyman work in the first half of this year; none said they performed these services in 2004.

“While remodelers are continuing to struggle, we expect the rest of 2010 to be a period of stabilization for remodeling, with the first stages of recovery emerging by the end of the year, followed by a more robust recovery beginning early next year,” said NAHB Chief Economist David Crowe. “For now, professional remodelers are taking on smaller projects and working to find consumers willing to spend money despite the economic uncertainty.”

For more information about remodeling, visit www.nahb.org/remodel; or e-mail Kelly Mack at NAHB, or call her at 800-368-5242 x8451.

The publication includes a CD containing 160 essential forms and documents — culled from successful remodelers across the country — that you can customize to suit your business needs.

'How to Find a Professional Remodeler' Brochures Available at BuilderBooks.com

The newly updated brochure highlights the before and after photos of the most frequently remolded rooms in the house.

NAHB Remodelers Meetings and Events at Fall Board Meeting in New York

The following NAHB Remodelers meetings, events and activities will be held at the NAHB Fall Board of Directors Meeting in New York on Sept. 23-24:

Marriott Marquis, room TBD
BUILD-PAC Chairman Tom Woods invites all NAHB Remodelers to attend the remodelers appreciation reception.

For more information, e-mail Kelly Mack at NAHB, or call her at 800-368-5242 x8451.

The publication includes a CD containing 160 essential forms and documents — culled from successful remodelers across the country — that you can customize to suit your business needs.

'How to Find a Professional Remodeler' Brochures Available at BuilderBooks.com

The newly updated brochure highlights the before and after photos of the most frequently remolded rooms in the house.

Visit NAHB Remodelers Booth at Remodeling Show in Baltimore for Education, Resources

Visit the NAHB Remodelers carnival-themed booth at the Remodeling Show in Baltimore on Sept. 14-17 to learn about NAHB Education offerings, the NAHB International Builders’ Show, green remodeling resources, advancements in aging-in-place, Home Builders’ Institute training and workforce programs, the benefits of being an NAHB Remodeler and a chance to play the remodelers’ high-striker game.

In addition, NAHB Remodelers will host a local council workshop for local council staff members and leadership from 1:00-3:00 p.m. on Sept. 16.

For a full list of courses, NAHB Remodelers activities at the Remodeling Show and free exhibit registration, visit www.nahb.org/remodelingshow, or e-mail Kelly Mack, or call her at 800-368-5242 for more information.

NAHB Disagrees With EPA Plans to Expand Lead Paint Rule to Commercial Buildings

The EPA’s action represents the beginning stages of a federal rulemaking process in which the agency is determining whether interior and exterior renovation activities performed in commercial and public building built prior to 1978 represent a lead hazard due to the lingering effects of lead-based paint dust that may be disturbed during typical renovation activities.

“We have already seen the negative effect of this on residential projects in our area, and now the EPA is proposing to expand the program to include commercial projects. This new rule will only push even more remodel work underground,” said Ted Clifton, of Clifton View Homes Inc. in Coupeville, Wash., a member of the board of trustees of NAHB’s Commercial Builder Council.

“There is already a huge drag on the construction industry by the underground economy, which pays no taxes but competes unfairly for the customer dollar,” said Clifton. “This rule will do absolutely nothing to protect consumers because of underground work — or consumers will opt to do the work themselves without the proper equipment or knowledge.”

In its comments, the coalition said that the statute under which the EPA would issue the rule does not give ihe agency the authority to issue work practice standards for lead renovation, repair and painting in public and commercial buildings.

If commercial builders and remodelers are already in compliance with basic remodeling and maintenance standards and regulations, the coalition argued, lead paint issues should not exist.

“In my 35 years,” said Steve Moore, of Moore and Company in Bellingham, Wash., “I have not encountered lead paint only once in commercial buildings here in Bellingham or Orange County, Calif.”

“There are a number of existing regulations already in place that are nbetter than this proposed rule, such as those for standard renovations. Simply enforce what already exists,” he said.

Comments submitted to the EPA also pointed out that potential exposure pathways in commercial buildings are much different than those in residential buildings. Furthermore, the coalition argued, the EPA has not collected data on potential lead-based paint dust exposure risks to children from renovation work in pre-1978 commercial buildings.

The EPA is expected to publish its position on health risks from renovation work in commercial buildings by July 2011, opening the door to further rulemaking.

Learn How to Benefit From Home Technology Trends During Free Webinar on Aug. 11

Builders, electronic systems contactors (ESCs) and other industry professionals can learn how to take advantage of home technology trends in a slow market during the free webinar, “Installed Home Technology: A Key Part of Builder Business Success,” from 2:00-3:00 p.m. Wednesday, Aug. 11.

Conducted by NAHB and the Consumer Electronics Association (CEA), the webinar is based upon the CEA’s 8th Annual State of the Builder Technology Market Study and features a panel of home builders and technology experts who will discuss the increasing importance of home technology in home building and new-home sales as consumers become more aware of the many technologies available that can enhance their lifestyle and home.

Panelists include: Steve Koenig, CEA’s director of industry analysis; Tom Stone of Stone-Glidden High Performance Home Systems, an installation firm that integrates audio-video, lighting, security and automation for new and existing homes; and Tony Crasi of The Crasi Company, a full service residential design build firm.

To register for the free webinar, click here. Upon registering, participants will receive a confirmation e-mail containing information about joining the webinar.

For more information, e-mail Agustín Cruz at NAHB, or call him at 800-368-5242 x8472.

Free DOE Webinar on National Residential Retrofit Guidelines Set for Aug. 11

The U.S. Department of Energy Office of Energy Efficiency and Renewable Energy (EERE) will conduct a free webinar on Wednesday, Aug. 11, describing efforts underway to develop national guidelines for the work and workforce involved in residential energy efficiency retrofits.

Webinar attendees will learn how the DOE expects these proposed guidelines to improve the quality of weatherization services and other residential retrofit work; assist training providers in developing industry-recognized course content and curricula; increase mobility and improve the careers of weatherization and residential energy efficiency retrofit workers; and build confidence among consumers and the banks that finance the work.

Attendees must register in advance to get a URL for the presentation and call-in phone number for the free webinar.

Sept. 9 Webinar to Help Builders Compare Operations, Performance With Like-Sized Peers

Comparing how similar-sized builders across the country fared during the market upheaval of 2008 can help builders benchmark their own businesses and plan for the future.

During the upcoming NAHB “Building Conversations” webinar, “Cost of Doing Business,” one of the authors of NAHB’s biannual “Cost of Doing Business Study,” and other panelists will discuss the most recent study’s results and explain how builders can benefit from comparing their own financial results against the industry as a whole.

The study illustrates how builders of different types and sizes weathered the economic turmoil of 2008 and will enable builders to compare their operations against those of like-sized peers.

Several categories — including volume, operation type and land vs. no land costs — are analyzed to help builders fine-tune comparisons between study results and their companies.

'Building Conversations' Series Explores Green Building, Financing, Home Technology, More

A five-part, interactive webinar series from NAHB, now underway, is exploring a new home industry topics and trends including using social media to sell homes, green building, the cost of doing business, syndicate financing and home technology.

The “Building Conversations” series will feature industry experts from around the county who will share insider views on the five topics and encourage participants’ questions and comments during each webinar as well as afterwards through NAHB’s growing social media network.

The sessions will be held from 2:00-3:00 p.m. EDT on the second Thursday of each month from now through November (except for August). Replays of previously broadcast webinars are available.

Attendees can earn one hour of continuing education credit toward their NAHB designations for each session.

On-demand recordings of the webinars already held are available within a week of their live webcasts. On-demand participants who did not register for the live webcasts must register for the on-demand recordings.

The fee for each webinar is $24.95 for NAHB members and $34.95 for non-members. The fee for the five-part series is $99.75 for NAHB members and $149.75 for non-members. Participants must be registered to hear a webinar or its rebroadcast.

For more information about the Building Conversations webinar series or sign up for rebroadcasts, e-mail Mary Knowles at NAHB, or call her at 800-368-5242 x8057.

NAHB Seeking Amendment on International Green Construction Code

NAHB is seeking an amendment to the proposed International Green Construction Code (IGCC) that would allow local green building programs to continue to offer voluntary green home certification for new and remodeled homes.

The International Code Council will conduct a Public Comment Hearing in Chicago on Aug. 14-22 to review more than 1,500 comments on the first draft of the IGCC.

The ICC launched the development of the IGCC in June of 2009 in association with the American Institute of Architects, ASTM International and other industry groups. Public Version 1.0 was released for comments on March 15 after a series of meetings held by the council’s Sustainable Building Technology Committee.

A key issue for NAHB is a reference to the National Green Building Standard (ICC 700). While the provisions of the IGCC are intended for all commercial and industrial buildings, the draft provisions also stipulate that the requirements of ICC 700 shall apply to all residential occupancies.

The only exception is for high-rise (greater than 75 ft. in height) residential buildings, where the draft proposal provides an option to use either ICC 700 or the IGCC.

Additionally, the IGCC would require the minimum energy efficiency for residential occupancies to exceed the 2006 International Energy Conservation Code (IECC) by 30% — the current “Silver Level” of ICC 700.

Since the IGCC is intended to be adopted by jurisdictions on a mandatory basis, NAHB is concerned that any jurisdiction adopting this new green building code would either have to automatically include residential buildings or seek an amendment.

Such a mandate would undermine many of the highly successful existing local green building programs, as well as NAHB’s efforts to promote voluntary programs based on ICC 700.

Further, NAHB is opposed to mandates for residential construction because green building provisions are often too costly to be applied to all new housing and would greatly limit the ability of low-income and first-time buyers to purchase a new home.

NAHB is seeking to amend the current requirement by adding a simple box that the jurisdiction can check to specify whether residential occupancies and the reference to ICC 700 are applicable when adopting the IGCC.

This would allow adopting authorities to decide whether residential green building mandates are appropriate for their jurisdiction — without the need for code amendments, which are often difficult.

This is one of the many changes NAHB will be pursuing during the IGCC Public Comment Hearing and is only the first step in NAHB’s advocacy on issues related to the IGCC.

After incorporating the changes approved by the Public Comment Hearing Committee, ICC will release Public Version 2.0 on Nov. 3. This second public draft will then be subjected to a full code development cycle with two rounds of hearings in 2011.

Not until after the ICC governmental members vote at the final hearings in November 2011 will the requirements of the IGCC be finalized. Publication of the 2012 IGCC is scheduled for March of 2012.

For more information, e-mail Calli Schmidt at NAHB, or call her at 800-368-5242 x8312.

“The National Green Building Standard,” available through BuilderBooks.com, provides “green” practices that can be incorporated into multifamily and single-family new home construction, home remodeling and additions and site development.

The standard covers lot design, resource, energy and water efficiency; indoor environment quality; and owner education.

Currently the first and only ANSI-approved green building rating system, the National Green Building Standard is the benchmark for green homes.

The "National Green Building Standard Commentary," available through BuilderBooks.com and a companion to the ANSI approved "National Green Building Standard," that provides valuable insight to the intention and implementations of the practices and provisions found in the green building standard.

The "Commentary" is a useful resource for any designer or builder using the ICC 700-2008 as a rating system for developing or renovating residential properties of all types to reduce their relative impact.

More Than 5,000 People Have Earned Their Certified Green Professional (CGP) Designation

The Certified Green Professional (CGP) designation teaches builders, remodelers and other industry professionals techniques for incorporating green building principles into homes using cost-effective and affordable options.

Earning the CGP demonstrates to clients and peers your commitment to the best and latest in green building practices and techniques. More than 5,400 people have earned the CGP designation to date.

“Build Green and Save: Protecting the Earth and Your Bottom Line,” available through BuilderBooks.com, is a comprehensive, easy-to-read reference that shows builders how to identify and select green building materials; implement green construction techniques; explain the benefits of green housing and offer affordable green building solutions to consumers; and use resources wisely and reduce water and energy consumption.

For answers to questions about National Green Building Certification by the NAHB Research Center, certification to the standard or the guideline sunset, complete and submit the Contact Us form on the NAHBGreen website.

Research Center Working With DOE to Improve Residential Energy Efficiency

The NAHB Research Center has been chosen as one of 15 national research and deployment partners that will be working with the Department of Energy's Building America program to support efforts by the agency to increase the energy efficiency of new and existing homes.

To participate in this undertaking, the Research Center has created its Industry Partnership for High Performing Homes, which is a team of 76 key stakeholders that includes the U.S. Department of Agriculture’s Forest Products Laboratory, the Southface Energy Institute in Atlanta, trade associations, non-profits, state energy offices, builders, remodelers and manufacturers.

The Research Center will be competing for DOE award grants of between $500,000 and $2.5 million for projects over the next four-and-a-half years that are designed to make the nation’s housing stock more energy-efficient through cost-effective new technologies, streamlined building processes and other means.

The NAHB Remodelers, Construction, Codes and Standards Energy Subcommittee, Construction Technology Research Subcommittee and Building Systems Councils are also among those who will be working with the Research Center as it moves forward on this project.

At the association’s spring board meeting in April, an NAHB task force reported how retrofitting homes for energy-efficiency could be furthered by training programs for contractors and by incentives for home owners, such as the cash rebates of up to $8,000 proposed in the “cash for caulkers” legislation that has been moving through Congress.

“The opportunities are huge,” said Bill Owens, an Ohio remodeler who served on the task force and is also working with the NAHB Research Center Industry Partnership.

But beyond incentive programs, remodelers need to know how to market their services — and convince home buyers that the return on investment from better air sealing is more important than a new granite countertop. That’s a hard sell, Owens said. “It’s still one client at a time,” he said.

“We’re trying to get people to be cognizant of their monthly utility payments and balance that with the idea that no matter what, we know that energy costs are going to increase,” even if last summer’s $4 per-gallon-gas prices are merely a distant memory, he said. “With the high costs of construction, people are much more interested in aesthetics. They opt out of the performance aspects of a remodeling project because their utility bills are not that high right now.”

Owens said that the comfort of a draft-free home is also a selling point for energy improvements, especially among baby boomers.

“The growing and aging American housing stock of more than 116 million units represents a significant potential for controlling energy consumption,” said NAHB Research Center President Mike Luzier.

He added that 60% of the partnership’s work will be focused on existing buildings.

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

The standard covers lot design, resource, energy and water efficiency; indoor environment quality; and owner education.

Currently the first and only ANSI-approved green building rating system, the National Green Building Standard is the benchmark for green homes.

More Than 5,000 People Have Earned Their Certified Green Professional (CGP) Designation

Earning the CGP demonstrates to clients and peers your commitment to the best and latest in green building practices and techniques. More than 5,400 people have earned the CGP designation to date.

Green Building Conference Seeking Educational Seminar Proposals for 2011

Proposals are now being accepted for educational seminars to be offered at the 13th Annual National Green Building Conference in Salt Lake City from May 1-3, 2011.

The conference is the only national event of its kind targeted to the mainstream residential building industry.

Presenters can expect to talk to builders, remodelers, land developers, engineers, architects, planners, public officials, environmental advocates and product manufacturers.

Proposals are being sought for sessions on a variety of green building topics, ranging from business management and marketing to building science and green technologies. All levels of content are being accepted, with a strong focus on advanced and cutting-edge sessions.

Returning to the 2011 conference will be “Greentensive” sessions that take a more in-depth look at specific topics such as energy efficiency, water efficiency and indoor air quality.

At the 2010 conference in Raleigh, N.C., these sessions drew standing-room-only audiences.

The conference organizers are looking for proposals that target different project types — including single-family and multifamily construction, remodeling and residential development.

Prospective speakers should describe their proficiency in areas such as energy efficiency, water conservation, indoor air quality, waste management, design and site development. All proposals will be evaluated based on their relevance to green building, the timeliness of the topic, their practical application and speaker qualifications.

For additional information, e-mail Chad Riedy at NAHB, or call him at 800-368-5242 x8225.

The standard covers lot design, resource, energy and water efficiency; indoor environment quality; and owner education.

Currently the first and only ANSI-approved green building rating system, the National Green Building Standard is the benchmark for green homes.

More Than 5,000 People Have Earned Their Certified Green Professional (CGP) Designation

Earning the CGP demonstrates to clients and peers your commitment to the best and latest in green building practices and techniques. More than 5,400 people have earned the CGP designation to date.

Decision to Expand Endangered Species Listings Brings NAHB Complaint

NAHB recently filed a complaint in federal court against the Department of the Interior for a new initiative by the U.S. Fish and Wildlife Service (FWS) to list animal and plant species in portions of their range that are found to be significant even if their population in general is not threatened with extinction. The agency has misinterpreted the Endangered Species Act, NAHB says, and it has implemented this new regulation without allowing for required public comments.

“The ESA is critically important to NAHB and its members due to its impacts on land development and use,” NAHB said in its complaint.

“In essence, it gives FWS the authority to list the Central Park gray squirrel as endangered, even though the gray squirrel population as a whole is not endangered,” said NAHB staff counsel Jeff Augello.

The Fish and Wildlife Service has already listed the Preble’s Meadow jumping mouse in Colorado even though it does not qualify as a separate species, subspecies or distinct population segment and is not likely to become endangered in the foreseeable future throughout the balance of its range.

Listing members of species in portions of their ranges triggers federal permitting requirements for home builders, undermines habitat conservation planning efforts and generally increases the costs of doing business for home builders nationwide, NAHB contends, unlawfully subjecting their land use activities to federal regulation.

It is “arbitrary and capricious because it conflicts with the plain language of the ESA, and Congress’s intent that the secretary list populations of vertebrate fish and wildlife sparingly.” In addition, it was made without public notice and comment, which is required before an agency can issue any rule that has legal consequences.

In a motion filed in late July, the Department of the Interior asked the district court to dismiss NAHB’s complaint, and NAHB will be responding to that motion by the end of this month.

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

New Limit on Storm Water Flow Threatens Redevelopment Projects in Virginia

New environmental requirements for some builders and developers in the Virginia suburbs of Washington, D.C. are posing a threat to planned redevelopment projects designed to encourage “smart growth” in the region.

Under Total Maximum Daily Load (TMDL) allocations proposed by the U.S. Environmental Protection Agency, builders seeking construction permits in the Accotink Creek watershed in Fairfax County will be required to show that they will be able to reduce storm water runoff from their site by 55.4%.

A permit that regulates the maximum flow of storm water allowed to leave the site — as opposed to setting limits on pollutants in any storm water from the site — is not unheard of, but exceedingly difficult to meet in already developed urban areas, noted Glynn Rountree, an environmental policy analyst at NAHB.

Fairfax County is concerned about the regulation as well, he said. With the watershed almost completely built out, there are minimal opportunities to address the water-flow issue by retrofitting impervious pavement during new development activities.

Because most of the watershed is residential or open space, the new requirement would predominately affect existing home owners attempting to make changes to their property.

The Accotink Creek watershed covers Fairfax County and portions of the cities of Fairfax and Vienna, and 25% of it is comprised of impervious surfaces on rooftops, streets, driveways, parking lots and sidewalks.

“The expense of meeting these requirements — falling on the county at the same time as the Chesapeake Bay TMDL requirements due this September — may be the death knell for planned redevelopment activities in Fairfax County,” Rountree said.

Ironically, many of the redevelopment projects are designed to protect the region’s water quality by reducing vehicular traffic and encouraging more mass transit, including a plan to make Tyson’s Corner — one of the nation’s largest retail and commercial centers — more pedestrian-friendly.

In a July 26 public meeting on the new requirements, EPA representatives acknowledged that coming into compliance with the TMDL will probably take decades and be costly and controversial, Rountree said.

The EPA spokespersons provided assurances that they would go lightly on enforcement during this lengthy transitional period, he said, but “agency staff come and go and promises regarding enforcement that are not written down have often been shown to have little value.”

The EPA also indicated at the meeting that it is planning to use flow reduction mandates in other new TMDLs as the opportunity arises.

“For home builders associations, the lesson to be learned here is that staff and environmental committee leaders should be encouraged to keep up with the TMDLs that have to be completed in the state. Otherwise, the EPA will step in and write a TMDL requiring flow reductions, thereby making life still harder for home builders,” Rountree said.

The publication has been prepared to help builders comply with the U.S. Environmental Protection Agency's stormwater requirements, and includes information on state permitting programs and more than 50 of the most commonly used Best Management Practices.

Also included are tips on compliance, including how to handle visits from inspectors.

Builders in Chesapeake Bay States Prepare for Big Changes in Storm Water Rules

The U.S. Environmental Protection Agency has released new guidance for municipalities in the Chesapeake Bay Watershed that is likely to bring significant changes to storm water management requirements for builders and developers in the seven-state region — especially those working in urban and suburban infill projects.

Unlike most EPA guidance documents, nobody has signed it and no office has acknowledged its part in developing the document.

The Urban Stormwater Approach includes 11 specific provisions that are expected to be reflected in the state’s required Watershed Implementation Plans (WIPs) “to the fullest extent possible,” according to the EPA guidance.

But the timeline is short. WIPs are due to the EPA by Sept. 1 for its review and approval. Home builders associations are urged to quickly contact state environmental officials and offer suggestions for compliance with the guidance to help ensure flexibility, said Glynn Rountree, environmental policy analyst for NAHB.

“There is very little time for the states to develop language for those provisions in the WIPs,” he said, but some will have a significant impact on building in the watershed, including the sections that cover post construction performance standards, retrofitting for existing discharges, water quality monitoring requirements and, especially, issuing permits with clear and measurable provisions.

“The states may have had some early warning of what the EPA would publish in this new document, but I doubt that anyone thought that the document would prohibit the common permitting terms of ‘practicable’ and ‘feasible,’ which are there to help ensure that that storm water management practices don’t become cost-prohibitive,” he said.

HBAs can suggest alternatives for compliance with the storm water requirements, including harvesting the rainfall for use on site or for infiltration, off-site mitigation opportunities, tree plantings and a fee-in lieu as a last resort, Rountree suggested.

Since many states work on new Construction General Permit requirements that reflect the EPA’s new rule on the effluent limitation guidelines, the groups affected by the sweeping new regulations are worried about the lack of coordination among rules for Total Maximum Daily Loads (TMDLs), state implementation plans and federal permit requirements, which makes it difficult for state and local government entities to comply or give the right advice to builders and developers seeking construction permits.

Stakeholders have also raised questions about the cost of compliance and the data used to conduct scientific analyses of the impact by new development, agriculture, municipal sewer systems, future population growth and other areas affected by the regulations.

Last week, NAHB weighed in on the state of Maryland’s plans to reissue storm water management permits for the construction and development industry. For the first time, the proposed permits include Effluent Limit Guidelines (ELG), a new federal requirement that previously only applied to industries that send pollutants into the watershed via drainpipes, as opposed to storm water leaving a job site.

In addition to commenting on issues raised in NAHB’s petition and lawsuit on the federal ELG rule — including the costs of implementation and the questionable environmental effect of using coagulants to bind sediments — the association asked the state to delay its plans.

“The Chesapeake Bay TMDL to be proposed in September 2010 could require that the Maryland construction permit be reopened again,” the letter said.

“The state’s storm water requirement roller coaster of amendments and revisions must stop.”

For additional information, e-mail Glynn Rountree, or call him at 800-368-5242 x8662.

Also included are tips on compliance, including how to handle visits from inspectors.

NAHB Joins Petition Against Rule on Greenhouse Gas Emissions

NAHB has joined a large coalition of trade groups in a petition asking the federal Court of Appeals to review the U.S. Environmental Protection Agency's “tailoring rule” on greenhouse gas emissions.

As a result, most schools, hospitals and even some large single-family homes would have had to apply for permits and employ complex technologies to remove or reduce any pollutants from those emissions.

This would also have brought most multifamily, mixed-use and potentially even master-planned community development to a halt.

As a remedy, the Tailoring Rule raised the statutory thresholds to well above 250 tons per year — but the threshold is not a permanent one, according to EPA’s ruling.

Instead, the tailoring rule uses a tiered system of emission thresholds, starting as high as 100,000 tons per year for certain sources and then decreasing that number over a period of years until 2016.

At that time, the EPA said it will issue new regulations to address treatment of smaller sources. Because it’s not clear how this exemption will work, how long it will be in effect or on what scientific basis the EPA set the threshold, NAHB joined the petition.

“While raising the statutory thresholds to these levels effectively eliminates any concerns that residential construction would have PSD permitting obligations, it’s not true relief, because it’s uncertain and it’s temporary,” said Amy Chai, senior staff counsel at NAHB.

Additionally, it’s not clear that the tailoring rule correctly satisfies congressional directives. This makes the EPA particularly vulnerable to legal challenges, Chai pointed out.

“The association is also concerned that the EPA does not provide a permanent exemption for small sources, only a promise to not regulate until 2016, less than six years from today,” she said.

“Finally, the EPA's interpretation of its ability to ignore the statutory thresholds represents a dramatic expansion of its authority which, if upheld, would make it extremely difficult for the courts and even Congress to limit the EPA's actions,” Chai said.

The petition was filed on Aug. 2 in the federal court of appeals for the District of Columbia.

Some Provisions in New OSHA Cranes and Derricks Rule Burdensome to Home Builders

OSHA estimates that the final rule, which goes into effect on Nov. 8, will prevent 22 crane-related fatalities and 175 non-fatal injuries annually. The rule will affect approximately 267,000 construction, crane rental and crane certification firms employing about 4.8 million workers.

While NAHB is generally supportive of the need to update the cranes and derricks standard, the association noted that significant changes in the rule can be burdensome to the industry. These include: assessment and sharing of knowledge about ground conditions; crane operator certification requirements; use of qualified riggers; and procedures for working in the vicinity of power lines.

“We are disappointed that OSHA, after working with NAHB for so long, did not significantly differentiate between the safety needs of residential and light commercial construction versus heavy industrial crane use when finalizing the rule,” said Ray Rhodes, of M&R Associates in Sanford, N.C., and chairman of NAHB’s Construction, Safety and Health Committee. “We are still concerned that some of the requirements in the final rule are not practical or economically feasible options for small employers in the residential construction industry.”

During a media briefing on July 28, OSHA Assistant Secretary David Michaels explained that the new rule is designed to prevent the leading causes of crane-related fatalities — electrocution, crushed-by/struck-by hazards during assembly/disassembly, collapse and overturn. The rule also establishes requirements for ground conditions and crane operator assessment.

NAHB will assess the impact that the rule will have on the home building industry and provide more information in the near future.

For more information on this new regulation, visit OSHA’s crane and derrick website by clicking here, or e-mail Rob Matuga at NAHB, or call him at 800-368-5242 x8590.

Home Design Trends: Versatility, Sustainability, Meeting the Needs of Different Generations

Today’s home owners are seeking versatility and sustainability in their home designs, according to panelists at NAHB’s recent “2010 Home Design Trends Webinar,” but different generations of buyers also want features that will complement their varying lifestyles and needs, they said.

For instance, architect John Thatch, AIA, of Dahlin Group, noted that the Eisenhower generation wants to incorporate universal design elements in their homes. This generation, he said, seeks to increase their homes’ functionality and improve the quality of their everyday lives by incorporating flexible space and simplicity in their homes.

Thatch said this generation of home owners wants to live in a home that will not require much physical effort.

Darcy Garneau, AIA, of EDI Architecture, Inc., said Generation Y home owners want small homes with “unique qualities and appearance that will allow them to stand apart from the rest.”

Generation Y home buyers gravitate toward innovation, “not only in the whole composition, but also in detailing,” Garneau said.

“Generation X is looking for the same qualities in the homes they rent as they do in the homes they would buy — small, versatile floor plans, exquisite details and natural finishes,” said interior designer Jillian Pritchard Cooke, of DES-SYN in Atlanta.

Cooke added that architects and designers have begun incorporating sustainability into homes by integrating features and details that are aesthetically pleasing as well as functional. She pointed to copper rain chains that collect and filter rainwater as one example.

While the panelists discussed incorporating aging in place and universal design in homes for baby boomers, all three agreed that many of the trends overlapped among different generations and that, ultimately, designers will have to determine what concepts to include in a home design based on the wants and needs of the specific client — while also keeping in mind the impact on resale and value.

In addition, the Design Committee will be hosting a “2011 Design Trends Roundtable” at the NAHB International Builders’ Show in Orlando in January. Panelists at the roundtable will identify upcoming trends as well as some of the products on the show floor that are piquing consumer interest.

For more information, e-mail Jaclyn Toole at NAHB, or call her at 800-368-5242 x8469.

Enter NAHB BALA Design Competition by Sept. 1, Submission Process Streamlined

Entries are being accepted for NAHB’s 2010 Best in American Living Awards (BALA), the foremost residential design competition in the country. Builders, interior designers, architects, land planners, remodelers, developers and marketing and real estate professionals are invited to enter.

The competition includes 32 categories — recognizing excellence in custom and spec homes; attached, detached and multifamily homes; affordable housing; remodeling; rental developments; communities; interior design; and green homes and communities.

"The BALA awards are the most prestigious awards of their kind, setting the benchmark for innovations in residential home design," said Mike Nagel, 2010 Design Committee chairman and a partner at Men at Work Chicago. "We are proud to have a long history of honoring those who set the bar high by encouraging creativity, originality and imagination in our industry."

For more than 25 years, the BALAs have fostered design excellence in the building industry and highlighted those builders, architects, interior designers, remodelers, developers and land planners who have achieved superior levels of creativity and innovation.

Formerly administered by NAHB and Reed Business Information, the awards program is now run exclusively by NAHB's Design Committee.

To streamline the submission process, award entries must now be submitted electronically — and hardcopy notebooks are no longer required.

Additionally, several award categories have been combined, and additional categories have been added for remodeling.

Winning entries will be announced at the NAHB International Builders' Show in Orlando in January and will also be featured in Nation's Building News Online.

To register and for information regarding deadlines, entry requirements and judging criteria, visit www.nahb.org/bala, or e-mail Jaclyn Toole at NAHB, or call her at 800-368-5242 x8469.

Education Calendar

See the variety of professional development offerings available through NAHB and its local associations in this interactive brochure.

GAF-Elk Introduces Industry’s First Affordable Luxury Shingles

The GAF Materials Corporation announced last month that GAF-Elk scientists had developed the industry’s first truly affordable luxury shingle.

Designed after GAF-Elk’s popular Camelot Lifetime Designer Shingles, the new Camelot 30 Designer Shingles offer dimensional appeal, striking color blends, durable construction and a luxury look. Yet the new shingles, which come with a 30-year warranty, cost only slightly more than standard architectural shingles.

The new product is being offered as an affordably priced alternative to standard architectural shingles for professional contractors looking for a way to differentiate their business.

“The initial interest in this shingle has been tremendous, as it allows contractors to offer a luxury alternative to their customers at a very affordable price point,” said Emily Cavanagh, senior product manager at GAF.

Camelot 30 Designer Shingles incorporate GAF-Elk’s proprietary Advanced Protection technology, reducing unnecessary filler while improving the performance of the shingles.

As with all GAF-Elk shingles, the new shingles have passed ASTM’s two toughest wind tests.

The shingles are warranted to withstand winds of up to 110 mph, depending on installation.

Available colors include Barkwood, Antique Slate, Weathered Wood, Charcoal and Shakewood. All come with StainGuard Protection to help protect against unsightly algae stains.

To learn more about the shingles and other GAF-Elk roofing products, visit www.gaf.com.

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.

Pulte Group Announces Seven ‘Build Your Future’ Scholarship Winners for 2010-2011

The Pulte Group and the National Housing Endowment, the philanthropic arm of NAHB, recently announced the seven winners of the 2010-2011 “Build Your Future” scholarships. The students were awarded a combined $50,000.

Founded in 1999, this scholarship provides tuition assistance to undergraduate students pursuing a career in the building industry. Created by Centex to assist in addressing the pressing need for educating and training residential construction industry managers, Pulte Group, which merged with Centex last year, is now funding the scholarship program.

“Pulte Group is proud of its efforts to remain at the forefront of builders providing educational opportunities to students pursuing careers in the home building industry,” said Jamie Bieth, director of human resources for Pulte Group. “We take seriously our obligation to give back to the industry and are proud to work with the National Housing Endowment on this effort.”

Since its founding, the “Build Your Future” scholarship fund has awarded more than $290,000 to 159 exemplary students attending residential construction programs across the country.

Each year, the endowment awards more than $350,000 in scholarships to students pursuing careers in residential construction and related fields.

HBA Deadline to Apply for NAHB/NOD Disability Initiative Award Is Sept. 10

State and local home builders associations are invited to enter the 2010 NAHB/NOD Disability Initiative Recognition Awards program recognizing outstanding examples of programs, projects and activities conducted by HBAs that further the goal of full participation of people with disabilities in community life.

The winner will be announced at the EOC installation luncheon at the 2011 International Builders' Show in Orlando in January. The winning HBA will receive $1,000.

Projects must demonstrate an awareness of disability issues as an organization; the positive impact it has on people with disabilities; and outreach to persons with disabilities.

For more information and an application, click here; or e-mail Ariel Moyer at NAHB, or call her 800-368-5242 x8595.

Past award-winning projects are ineligible to participate and their applications will not be considered.

For more information about the National Organization on Disabilities, visit www.nod.org.

NAHB Fall Board Meeting Set for Sept. 22-25 in New York City

OFFICIAL MEETING NOTICE OF
THE NATIONAL ASSOCIATION OF HOME BUILDERS
BOARD OF DIRECTORS

The following schedule of events is a partial listing provided as a notice for the upcoming NAHB Fall Board of Directors Meeting to be held in New York, N.Y., on Sept. 25, 2010, and other associated NAHB meetings to be held on Sept. 22-25. Meetings will be held at the Marriott Marquis-Times Square. The fall board program will identify the exact time and place of each scheduled meeting.

Wednesday, Sept. 22
State Representatives Meeting
National Area/Associate Chairmen Meeting
Joint National Area/Associate Chairmen and State Representative Meeting
Executive Board Meeting

Thursday, Sept. 23
Committees, Subcommittees, Councils, Affiliates, etc.
NHC Board of Governors Meeting
Nominations Committee

Friday, Sept. 24
Committees, Subcommittees, Councils, Affiliates, etc.
NAHB Past Chairmen Council Meeting

Saturday, Sept. 25
Area Caucuses 1-15
Joint Executive, Budget and Resolutions Meeting
Board of Directors

Longtime Member and Iowa Builder Robert Friedrich, Sr. Dies at 87

Robert Friedrich, Sr., a longtime member of NAHB leadership at the local, state and nationl level and Iowa builder who was instrumental in starting the association’s 50-year member recognition program, died on July 25 at Israel Family Hospice House in Ames, Iowa. He was 87.

Within the federation, Friedrich helped establish the Ames Home Builders Association and served as its first president in 1957. He served as the first treasurer of the Home Builders Association of Iowa and was elected its president in 1968. Friedrich also served as an NAHB National Vice President for Area 10.

Friedrich was the owner and operator of Friedrich Construction, a company founded by his father in 1925, and helped develop several of Ames’ surrounding suburbs, including Edgewood Terrace, Parkview Heights, Northridge, Somerset and Northridge Heights. As a leader in his community, he and his brother Reiny shared the title of Ames Chamber of Commerce Business Person of the Year as recently as 2001.

Born in Niederbobritzsch, Germany, at age 2, Friedrich and his mother immigrated to the United States through Ellis Island in New York harbor to join his father, who founded Friedrich Construction that same year. After graduating from Ames High School in 1941, Friedrich entered Iowa State University before enlisting in the U.S. Army and serving in the 402nd Combat Engineering battalion in North Africa and Italy during World War II.

He is survived by his brother, Reiny; his sons, Bob Friedrich, Jr. of Ames, and William Friedrich of Las Vegas; five grandchildren; and two great grandchildren. He was preceded in death by his first wife, Dorothy, and his second wife, Betty.

NAHB Members Can Apply Now for 2011 Appointments to Committees and Councils

Members of NAHB have an opportunity to lend their expertise and experience to the housing industry on a national level by serving on association committees and councils in 2011.

All NAHB members are encouraged to get involved and apply today. To access the 2011 Committee/Council Application Form, go to www.nahb.org/committeeform.

The deadline for applications is Oct. 3. Appointments will be finalized at the end of the year.

An individual can be appointed to no more than three standing committees or councils. All appointments are for a term of one year.

The first meeting of the 2011 NAHB committees and councils will be held during the spring board meeting.

For further information, e-mail Cynthia McKinley at NAHB, or call her at 800-368-5242 x8346.

Browse the NAHB BuilderBooks 2010 Virtual Publications Catalog Online

Presented in a virtual format as part of the NAHB BuilderBooks effort to go green and streamline delivery, the catalog includes both proven and new publications and products to help building industry professionals ramp up for a successful year as the industry and the economy begin to recover.

The materials in the catalog, written by industry leaders in various fields of residential construction, will help businesses streamline their daily operations, better serve their new and existing customers, develop strategies to safeguard job sites and, ultimately, build and sell more homes.

BuilderBooks features publications and products about accounting, estimating, business management, green building, sales and marketing, safety, construction codes, 50+ housing, multifamily housing, construction management remodeling and more.

Industry professionals are urged to save the publications catalog link as a favorite on their computer for future reference and use.

Members Can Save Big on Vacation Rentals Worldwide With Endless Vacation Rentals

NAHB members can save big on their vacation rentals anywhere in the world with Endless Vacation Rentals by Wyndham Worldwide, one of the world’s largest global marketers of vacation rental properties and part of NAHB’s Member Advantage discount program.

Members can choose from a vast portfolio of villas, condos, cottages and homes in more than 100 countries — while enjoying the comforts and space of home along with the amenities and services of a resort. And, with more than 200,000 vacation rentals worldwide, there’s something for everyone and every budget.

To plan a vacation and to view images, information and ratings on most properties, visit www.evrentals.com/nahb.

For the cost of a long weekend at a hotel, Endless Vacation Rentals guests can often stay for a week in a condo, villa or cottage. What’s more, a 24-hour concierge service can provide destination information before your departure and book activities, tee times and restaurant reservations.

Endless Vacation Rentals can also provide 24/7 telephone check-in assistance, upon request.

To book a vacation rental with Endless Vacation Rentals, visit www.evrentals.com/nahb, or call 877-670-7088 and mention code 20090. Vacationers will receive a confirmation e-mail within 24 business hours.

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.

Endless Vacation Rentals Disclaimer: Destinations and travel times are subject to availability and confirmed on a first-come, first-served basis. Offer includes only accommodations and specifically excludes travel cost and other expenses that may be incurred. Promotional discounts and offers may not apply to all properties. Other restrictions may apply. Offer void where prohibited by law. Additional taxes and conditions may apply.

Members Save on Weekly and Weekend Reservations From Hertz Made by Aug. 15

This offer is valid on reservations made through Aug. 15, with rental car pick-up before Sept. 30.

Members can make their reservations at hertz.com, with their travel agent or by calling Hertz at 800-654-2210.

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.

Liberty Mutual Offers NAHB Member Discounts on Auto, Home and Renters Insurance

NAHB members and their families can save on auto, home owners, condominium, motorcycle and watercraft insurance from Liberty Mutual Insurance Company, the newest NAHB Member Advantage affinity program participating company.

NAHB members can take advantage of a significant group discount* on Liberty Mutual insurance with convenient payment and enrollment options that meet their needs. Members should also ask about multi-policy discounts for insuring both their home and auto.

Contact Liberty Mutual and licensed representatives will explain insurance options in clear terms and recommend the best match for your specific situation, whether you need to protect your car, home, boat or condo.

For an in-person quote, visit any local Liberty Mutual office and identify yourself as an NAHB member and mention code #117234.

*Discounts and savings are available where state laws and regulations allow, and may vary by state. To the extent permitted by law, applicants are individually underwritten; not all applicants may qualify.

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 .

NAHB Calendar of Events

See the variety of professional development offerings available through NAHB and its local associations in this interactive brochure.

Nation's Building News Online: August 9, 2010

Most Builders Using Sales Incentives to Put Some Sizzle in a Cool Housing Market

St. Louis Builder Not Waiting for a Stronger Economy to Improve His Sales

It’s Time for Builders to Start Talking to Their Appraisers

Fannie Mae, Freddie Mac Losing Political Support as U.S. Reshapes Housing Finance System

Four Reasons to Be Upbeat on Housing

Six Reasons to Buy a New Home Now

Nielsen: This Isn’t Your Grandfather’s Baby Boomer

Friendly Fixtures

A Walker’s Guide to Home Buying

Senate Postpones Action on Small Business Lending Bill

Congress Approves Increase in FHA Premiums, Bolsters Program

Senate Delays Vote on Energy Bill, Home Star Provisions

Congress Acts to Boost Multifamily Loan Authority

Congress Ensures Funding for Key Rural Housing Program

House Passes Transportation-HUD Appropriations Bill

Banks Provide Many Alternative Routes for Settling Debts

Eye on the Economy: Moderately Faster Economic and Job Growth Lies Ahead

Useful Links to Monitor Economic and Housing Trends

New IRS Reporting Requirements a Costly Burden on Small Businesses

Register for the NAHB International Builders’ Show This Month and Get a Free Exhibit Pass

Enter NAHB Star! Talent Contest by Sept. 15 to Sing the National Anthem at IBS 2011 in Orlando

Register for Spokesperson Training Sessions at the Builders’ Show, Attendance Is Limited

Builders’ Tip: Modified Sawhorses Make Great Drying Racks

Pssst. Sell More Active Adult Homes by Featuring Beautiful Basics, Fewer Frills

How to Build Branding and Credibility and Gain Referrals, Repeat Business in Return

A New Reality for Creating Successful Residential Communities

Unavailability of Inexpensive Test Kits Pushes Cost of EPA Lead Paint Rule Higher

Remodelers See Dip in Second Quarter, But Early Recovery Stages Nearing

NAHB Remodelers Meetings and Events at Fall Board Meeting in New York

Visit NAHB Remodelers Booth at Remodeling Show in Baltimore for Education, Resources

NAHB Disagrees With EPA Plans to Expand Lead Paint Rule to Commercial Buildings

Learn How to Benefit From Home Technology Trends During Free Webinar on Aug. 11

Free DOE Webinar on National Residential Retrofit Guidelines Set for Aug. 11

Sept. 9 Webinar to Help Builders Compare Operations, Performance With Like-Sized Peers

'Building Conversations' Series Explores Green Building, Financing, Home Technology, More

NAHB Seeking Amendment on International Green Construction Code

Research Center Working With DOE to Improve Residential Energy Efficiency

Green Building Conference Seeking Educational Seminar Proposals for 2011

Decision to Expand Endangered Species Listings Brings NAHB Complaint

New Limit on Storm Water Flow Threatens Redevelopment Projects in Virginia

Builders in Chesapeake Bay States Prepare for Big Changes in Storm Water Rules

NAHB Joins Petition Against Rule on Greenhouse Gas Emissions

Some Provisions in New OSHA Cranes and Derricks Rule Burdensome to Home Builders

Home Design Trends: Versatility, Sustainability, Meeting the Needs of Different Generations

Enter NAHB BALA Design Competition by Sept. 1, Submission Process Streamlined

Education Calendar

GAF-Elk Introduces Industry’s First Affordable Luxury Shingles

Pulte Group Announces Seven ‘Build Your Future’ Scholarship Winners for 2010-2011

HBA Deadline to Apply for NAHB/NOD Disability Initiative Award Is Sept. 10

NAHB Fall Board Meeting Set for Sept. 22-25 in New York City

Longtime Member and Iowa Builder Robert Friedrich, Sr. Dies at 87

NAHB Members Can Apply Now for 2011 Appointments to Committees and Councils

Browse the NAHB BuilderBooks 2010 Virtual Publications Catalog Online

Members Can Save Big on Vacation Rentals Worldwide With Endless Vacation Rentals

Members Save on Weekly and Weekend Reservations From Hertz Made by Aug. 15

Liberty Mutual Offers NAHB Member Discounts on Auto, Home and Renters Insurance

NAHB Calendar of Events