Major drywall providers reportedly have planned a 25% price increase for around this time. According to a report in Hanley-Wood’s ProSales Online, a Nov. 3 announcement by USG Corp. of a price increase was followed by similar announcements by CertainTeed Corp., National Gypsum Co., Lafarge and Temple-Inland, Inc. USG, which reported $297 million in profit in the boom year of 2006, sustained huge losses in 2010’s first three quarters — including $100 million in the third quarter — reflecting “continued weak market conditions and extraordinary low shipping volumes,” said William C. Foote, the company’s chairman and chief executive officer. In 2009, production of drywall industry-wide was almost half that of 2006. USG said its third-quarter Sheetrock brand drywall price was $114.45 per 1,000 square feet — about 11.4 cents a square foot. In 2004, the price was $132.50 per 1,000 square feet. According to NAHB, a 2,272-square-foot new home uses about 8,100 square feet of drywall for walls and ceilings, or about $927 worth. An increase of 25% raises the retail material price to $1,158. If you are already working at razor-thin margins, even $200 more, multiplied by the number of houses built, can hurt. “Builders just cannot pass the additional cost on to home buyers,” said NAHB economist Bernie Markstein, who noted that drywall producers had already tried to raise prices twice this year and rolled them back when demand eased. South New Jersey builder Bruce Paparone agreed, saying that his firm would “have to swallow hard” in the face of materials price increases. “There is very little room in our pricing today,” Paparone said. “When we get our opportunities with a customer, we try to emphasize the huge differences in energy-efficiency, room sizes and kitchens of new homes vs. those built 15 years ago.” Paparone said his chief competition is the resale market, which has more flexibility in pricing than new construction has. (www.phillynews.com)
The Philadelphia Inquirer (11/15/10); Alan J. Heavens

The National Community Reinvestment Coalition planned to file a series of landmark federal fair housing complaints beginning Dec. 6, challenging a widespread practice by banks and mortgage lenders of requiring borrowers who apply for FHA loans to have FICO credit scores well above the 580 minimum set by the FHA for qualified applicants with 3.5% downpayments. The complaints allege that the higher FICO requirements disproportionately discriminate against African American and Latino borrowers, many of whom have credit scores above the 580, threshold set by FHA, but below the 620 to 660 minimums frequently imposed by private lenders. FICO scores run from 300 to 850, with higher scores correlated with lower future risk of default. According to a draft complaint that housing columnist Kenneth Harney obtained in advance, the coalition conducted what it calls “extensive” blind tests among lenders active in the FHA program. Testers presented themselves to loan officers as financially qualified applicants for FHA-insured mortgages, with FICO scores between 601 and 605. Loan officers routinely informed them that they cannot accept applicants with FICOs less than 620. When applicants responded that they knew FHA is willing to insure loans for borrowers with credit scores as low as 580, often they were told the same: We require higher FICO scores on FHA loans than the FHA does. (www.washingtonpost.com)
Washington Post (12/3/10); Kenneth R. Harney

The Alaska home building market is doing ok, according to Jeff Twait, president of the Kenai Peninsula Builders Association. “Every time I’ve gone Outside, I get on the airplane and come home, I thank my lucky stars,” Twait said. “We’re kind of bobbing along the bottom, but it’s going to be a long, slow recovery to where we need to be.” On the Kenai, remodeling has become more common. Home owners also have been using energy tax credits to replace windows and put in insulated siding and they are looking at more energy-efficient homes, he said. “With the cost of energy, if you don’t need a four-bedroom house, if you can survive in a three-bedroom house, people are going to start doing that,” he said. Another trend Twait sees is less building to invest. In the past, home owners might have periodically traded up, using equity to finance a larger house, with the expectation that selling a large house before moving into a smaller, empty-nest home would support a family retirement. “We might get back to where we’re going to build a house you’re going to be in for 25 years,” Twait said. Alaska has been spared many of the economic difficulties of the Lower 48, he added. “We’re fortunate here. We haven’t seen a lot of the factors that caused the housing crisis Outside. We didn’t have a lot of subprime lending, a lot of spec home building.” The oil industry and tourism also softened the blow to Alaska, Twait said. Foreclosures in the state were about the same for 2010 as in 2000. (www.homernews.com)
Homer News (11/17/10); Michael Armstrong

Franklin and Brentwood, Tenn., may see a dip in population in the near future as older residents seek appropriate downsized housing that’s not available in the area. Edsel Charles of Market Graphics Research Group, a Franklin-based company that studies housing trends, said in an interview that both cities are sorely lacking in the kinds of homes that most empty nesters and retirees need. He emphasized a strong belief that Williamson County’s housing stock — especially in Brentwood — is insufficient to meet the needs of baby boomers, who comprise a major segment of the market. As a result, many will most likely move away. The ones at the top of the economic ladder might be the only boomers who can afford to stick around. Charles said they will be able to have houses custom-built for their golden years. With numerous luxury features, the homes may drive the cost per square foot $20 to $40 above the norm. These “downsized” houses will be about 2,700 to 3,600 square feet, said Charles, who estimated the upscale retirees might make up as much as 12% of the retiree market. Everyone else, the “regular retirement market,” will probably have to move to find a smaller house, or they might stay in their big, family-size houses and close off parts of them to save on power bills, he said. “People are going to be buying a lot of towels to stuff under the doors,” he predicted. Most people who live in houses of 3,000 to 4,000 square feet, whether in Franklin or Brentwood, will want much smaller homes, priced in the $190,000 to $240,000 range, he said, noting, “It is almost impossible to find new housing in that price range if you want to retire in Williamson County.” (www.tennessean.com)
Tennessean (11/26/10); Nancy Mueller

Matt Morrow, president of the Home Builders Association of Greater Springfield, Mo., says that a housing economic impact study being conducted by NAHB could confirm that housing in a six-county area of the state has lost activity supporting nearly 35,000 jobs over a three-year period. From 2004 to 2006, there were 14,469 single-family homes permitted — an average of 4,800 a year — in the counties. According to NAHB’s formula that 100 homes supports 324 jobs for a year, the construction during this period supported 46,656 jobs. But from 2008 through 2010, there were 3,681 single-family homes permitted — supporting 11,926 jobs. “That’s approximately 13,700 fewer jobs being supported per year in our regional economy during the past three years,” Morrow said. “Now is a really good time for local governments to sit back and think about ways they can encourage home construction — what can we do to make it a little easier for home builders to build here in town,” said Elliot Eisenberg, the NAHB economist who is providing the local analysis. Reducing permit fees or streamlining zoning or applications processes, for example, would help make homes less costly and more affordable to people who might want to buy. “Making rules that make sense,” he said. “Re-examining rules that have been passed several years ago that now are outdated and no longer make sense. Fee schedules that have to be adjusted. Zoning ordinances that have to be fixed. Put yourself in the shoes of the local businessman. What can we do that’s reasonable and fair and appropriate and right to give them a fighting chance to make a living?” (www.news-leader.com)
Springfield News-Leader (12/1/10); Wes Johnson

Although skylights might not top the list of “musts” for a potential home buyer, experts say they are a desirable feature. But there are many options, both in materials and design, and all require careful inspection. “You should never feel a draft,” regardless of the type of skylight installed, says Matt Sullivan, owner of Bethesda, Md.-based Sky Wright, which installs and repairs skylights. And no maintenance should be required, he and other experts say. “If you are having to caulk, it’s time to replace them,” Sullivan says. During inspections, Baltimore home inspector Stephen R. Dallmus is frequently asked, “How’s the skylight?” Dallmus says his answer is usually: “If I was here when it was installed, then I could really respond.” That’s how important installation is. Once there is a leak, there will be others, experts say. “You can slather on all the goo you want, but it really just needs to be reinstalled according to the manufacturer’s specifications,” Dallmus says. “It may be dry today, but it won’t stay that way.” Skylights won’t last as long as the rest of the house. Even newer models generally have a life span of about 20 years, Sullivan says. The acrylic plastic bubble skylights tend to show the most age because the sun makes them look cloudy, Sullivan says. Glass “will look better for longer,” he says. Although installing skylights won’t add thousands of dollars to a home’s resale value, real estate experts say they often recommend them for additions. When home owners add on, a window might get turned into the entrance for the addition. The old room “can seem incredibly dark,” Sullivan says, “and to compensate, the architect may suggest a skylight.” Skylights are also a good way to open a room and add architectural interest. (www.washingtonpost.com)
Washington Post (12/2/10); Laura Barnhardt Cech