Housing & Building Association of Colorado Springs

US home prices up 9.3%, the most in nearly 7 years

cshba — Tue, 30 Apr 2013 21:33:39 +0000

April 30, 2013 8:10 AM

THE ASSOCIATED PRESS

IN THE SPRINGS:

Colorado Springs is not part of the Standard & Poor’s/Case-Shiller 20-city home price index. But area home prices have been rising. The median price of area homes sold in March rose to $212,000, a 12.2 percent year-over-year increase, according to a Pikes Peak Association of Realtors report.

THE GAZETTE

WASHINGTON — U.S. home prices rose 9.3 percent in February compared with a year ago, the most in nearly seven years. The gains were driven by a growing number of buyers who bid on a limited supply of homes.

The Standard & Poor’s/Case-Shiller 20-city home price index increased from an 8.1 percent year-over-year gain in January. And annual prices rose in February in all 20 cities for the second month in a row.

Phoenix led all cities with an annual gain of 23 percent in February. Prices jumped nearly 19 percent in San Francisco. In Las Vegas, home prices increased 17.6 percent and in Atlanta they rose 16.5 percent.

Eleven of the 20 cities reported price gains in February compared with January. Those monthly numbers are not seasonally adjusted and reflect the slower winter buying period.

The index covers roughly half of U.S. homes. It measures prices compared with those in January 2000 and creates a three-month moving average. The February figures are the latest available.

Steady hiring and near-record low mortgage rates are driving up demand, helping sustain the housing recovery that began last year. Buyer traffic was 25 percent higher in March than it was a year ago, according to the National Association of Realtors.

At the same time, prices are surging because buyers have fewer homes to bid on. The number of homes available for sale has fallen nearly 17 percent in the past year to 1.93 million, the Realtors’ group said last week. At the current sales pace, that supply would be exhausted in 4.7 months, below the 6 months that is typical in healthier markets.

Home prices nationwide are still about 30 percent below their peak reached at the height of the housing bubble in August 2006. They are only back to where they were in the fall of 2003.

And Stan Humphries, chief economist at Zillow, a real estate data provider, cautioned that the national figures are being skewed by sharp rebounds in cities hit hard during the housing bust, including Las Vegas and Phoenix. Investors are helping drive up prices in those cities.

“This report needs to start being taken with a grain of salt, Humphries said. “The appreciation rates we’re currently seeing … are not broadly reflective of what’s happening in the national housing market right now.”

Steady home price gains can help drive the housing recovery. Higher home prices encourage more people to buy before prices rise further. They can also entice more homeowners to sell by making them more confident they’ll get a good price. In addition, higher prices raise the equity people have in their homes, which makes selling more profitable.

But many homeowners still owe more on their mortgages than their homes are worth. That can make it difficult to sell.

Higher home values can also help the economy. They increase homeowners’ wealth, which encourages more spending. Consumer spending drives 70 percent of economic growth.

Sales of previously occupied homes leveled off over the winter but may increase in the coming months. A measure of signed contracts to buy homes rose to a three-year high in March.

Homebuilders are also starting work on more new homes and apartments. That creates more construction jobs. Builders started work on more than 1 million homes at an annual rate in March. That’s the first time the pace has topped that threshold in nearly 5 years.

Remodelers Registered Less Confidence in First Quarter

cshba — Fri, 26 Apr 2013 21:27:03 +0000

Concerns about rising costs for building materials and labor helped drive NAHB’s Remodeling Market Index (RMI) of remodeler confidence down six points to 49 in this year’s first quarter, according to data released this week. Contributing to the decrease was an eight-point decline in the component measuring future market indicators, which went from 56 to 48 this time around. The component measuring current market conditions posted a four-point decline to 50. On a positive note, all categories of remodeling in owner-occupied homes achieved a reading of 51 or better in the latest report, meaning that more remodelers reported improving activity in that sector than declining activity. Repairs and minor additions are currently the strongest categories of business for remodelers as home owners continue to invest in deferred maintenance and room-by-room remodeling, notes 2013 NAHB Remodelers Chairman Bill Shaw, GMR, GMB, CGP. Meanwhile, commenting on the latest data, NAHB Chief Economist David Crowe said, “Although this quarter’s RMI indicates a pause in the improvement that the remodeling market had been showing, it is nevertheless the third highest reading for the RMI since the first quarter of 2006. Like the rest of the home building industry, remodelers are starting to feel squeezed by higher costs and limited availability of labor and materials, which is unusual at such an early stage of a housing recovery. However, the downturn was so deep and extended that this time it may take a while to re-establish the supply chains.” For more info, see the RMI tables at nahb.org/rmi or contact Rose Quint (800-368-5242 x8527).

NAHB Defends Critical Housing Incentives in U.S. Tax Code

cshba — Fri, 26 Apr 2013 21:21:41 +0000

In a second round of congressional testimony this week, NAHB vigorously defended the importance of vital housing tax incentives such as the Low Income Housing Tax Credit, mortgage interest deduction and real estate tax deductions as lawmakers consider ways to reform the U.S. tax code. NAHB economist and Assistant Staff Vice President Robert Dietz told members of the House Ways and Means Committee that, “Because home building is an industry dominated by small businesses, the idea of simplifying the complicated tax rules related to business has great appeal. At the same time, our industry remembers painful lessons from the 1986 Tax Reform Act, when the commercial and multifamily sectors experienced a downturn due to unintended consequences.” He reminded legislators of the important impacts that housing has on the economy and job growth, noted the critical role that the Low Income Housing Tax Credit plays in creating affordable rental housing, and set the record straight on a number of false assumptions regarding the mortgage interest deduction. For these reasons and more, he said, we urge Congress to be cautious and thoughtful when it comes to housing and tax reform. “Housing provides the momentum behind an economic recovery because home building and associated businesses employ such a wide range of workers. With the right policies in place, housing can be a key engine of job growth that this country needs,” Robert said. Read more here, or for additional information, contact Robert Dietz (800-368-5242 x8285) or J.P. Delmore (x8412).

A Tale of Two Households

cshba — Thu, 04 Apr 2013 16:58:09 +0000

Elliott Eisenberg

by Elliott Eisenberg, Graphs & Laughs

During the last year and especially the last five or six months, the economic data have been of two minds. On one hand, household net worth is way up, the stock market has been setting new highs and the number of millionaires is at 9 million, just below where it was before the recession. At the same time, we read that the amount spent at restaurants, bars, and department stores recently fell as households compensate for higher gas prices and payroll tax increases by reining in discretionary spending. Which is it? Is the economy getting better or are households hunkering down? Turns out, it’s both. Behind this seeming paradox is the growing gulf between America’s wealthier households and its poorer ones. And the past recession has put this gap into bold relief.

While suffering during the Great Recession, wealthier households, because they are more likely to own equities and a home, have enjoyed the recent rise in house prices and the stock market, as well as the special year-end dividends that were timed to avoid tax increases that went into effect the first of this year. In addition, because they can borrow money at today’s historically low rates, they are spending more on vacations, cars and other high-end discretionary purchases as their financial situation improves. Moreover, over the last few years their incomes have been rising, something the majority of the population has not been experiencing.

By contrast, households in the bottom half of the income distribution are having a tough time of it. The combination of stagnant wages in the years before the Great Recession, large job losses during the recession, current high levels of unemployment, the dramatic increase in those unemployed 12 months or more, high gasoline prices and delayed income-tax refunds are forcing these households to forgo many purchases. As such, retailers that cater to lower and middle-income Americans are feeling the pinch. Worse, the payroll tax hike will probably take three or four months before its impact is fully felt.

Fortunately, those in the top half of the income distribution are doing well and they pack a lot of retail punch. The top 20% of households account for 38% of all spending while the top 50% of all households account for 70% of all spending. By contrast, the bottom quintile is responsible for a tad less than 9% of all spending. And so far, higher income households have been carrying the load, with spending most recently rising at a month-over-month rate of 0.7%, the best level since a 0.8% gain in September 2012.

Despite high-income households facing higher taxes due to the expiration of the Bush tax cuts and everyone facing the vagaries of the sequester, the economy is not on the ropes. A diet of dirt-low interest rates, a booming energy sector, and solid improvement in the all-important cyclicals including autos, big ticket items, business fixed investment, and most importantly homebuilding, should translate into increases in middle- and lower-class employment and (hopefully) wages, and thus more household spending among those doing relatively little of it now.

Elliot Eisenberg, Ph.D. is President of GraphsandLaughs, LLC and can be reached at Elliot@graphsandlaughs.net. His daily 70 word economics and policy blog can be seen at www.econ70.com.

Four Reasons to Be Optimistic

cshba — Fri, 08 Mar 2013 22:42:31 +0000

By Elliot Eisenberg, Ph.D.

While economic growth has been lackluster since the end of the recession in summer 2009, this is likely to change, despite the sequester. Here are my top four reasons why, in rank order of their importance to the economy going forward.

The painful process of deleveraging is over. Deleveraging is, in part, what caused this recession to be so painful compared with all other post-WWII recessions. Non-financial corporations have outstanding balance sheets, and have actually begun to releverage. Commercial and industrial loans are once again on the rise and the banking sector is healthier than it has ever been since record keeping began. To give just one indicator, the core capital ratio of banks is 9.2%; the post WWII average is 7.5%. Households are pretty good shape too. There are now only about nine million households seriously behind on some sort of payment. At the peak of the recession, the number was 20 million, while now credit card and auto loans and personal loan defaults are all profoundly low. The surprisingly rapid rate of deleveraging is partly why the housing sector is now recovering much faster than expected.

The housing market has turned the corner and the next few years should be excellent. At their weakest, housing starts were 550,000 units/year. They are now at 900,000 and should grow by 200,000 units/year for the next three to four years, topping out at about 1.7 million units in 2016. This is being driven by a rise in household formations that were delayed due to the anemic job market. Note that each new home creates about 5 new jobs nationwide, so 200,000 new homes means a million new jobs. And while there are still about three million first mortgages in foreclosure, that number is way down from where it was and is on its way to the 750,000 mark, which is the historic norm.

The next reason I am optimistic is because US corporations are profoundly competitive and have drastically lowered their costs. As a result, they are now able to compete with firms anywhere and win. Unit labor costs are way down. In the manufacturing sector, they are back to where they were 20 years ago, and as a result corporate profits have been setting records quarterly. Productivity is so high firms that would not have previously considered manufacturing here (like Apple) are now taking a second look.

Lastly, despite severe dysfunction on Capitol Hill, substantial progress has been made on the fiscal front. The cumulative impact of the tax increases and spending cuts enacted in spring 2011, during the debt-ceiling fiasco of late summer 2011, the recently completed New Year’s Day fiscal-cliff negotiations, along with the most recent sequester have come close to stabilizing our public debt-to-GDP ratio somewhere in the 75% to 78% range. With another $500 billion in spending cuts and or tax increases over the next decade, we will be done.

Our economy has come a long way. The worst is over and by the end of the year the economy will hopefully look a lot different than it does now. And housing will be leading the way.

Elliot Eisenberg, Ph.D. is President of GraphsandLaughs, LLC and can be reached at Elliot@graphsandlaughs.net. His daily 70 word economics and policy blog can be seen at www.econ70.com.

The Housing & Building Association Recognizes Outstanding Members Of The Association

cshba — Tue, 19 Feb 2013 16:08:34 +0000

The Housing & Building Association (HBA) of Colorado Springs awarded Tim Siebert with N.E.S. the “Associate Member of the Year”, Nathan Liljestrand with Custom Creations the “Remodeler Member of the Year”, Mark Bussone with Vantage Homes the “Builder Member of the Year”, and Jerry Novak with Classic Homes the “Industry Person of the Year”. David Jenkins and Kent Petre with Nor’wood Limited received the prestigious “Founders Award” at its Annual Awards Reception on Wednesday, February 13 at the Antlers Hilton. The Reception was resided over by John Bisset, the 2013 President of the HBA and included many local elected officials and over 160 HBA members. These Awards recognize Members for their distinguished service to the HBA, the building industry, and the community.

Below are a few words about the awards and each of the recipients:

Associate Member of the Year

It takes many member companies from all areas of our industry to make our Association the strong force within the community. Many of these companies are Associate Members who are constantly at the forefront of HBA activities – serving on committees, organizing events, lending their expertise to industry issues, and recruiting and retaining members for our organization.

Tim served as Chair of the Land Use Committee, participated on the Public Policy Committee, Board of Directors, NAHB Leadership Institute, American Society of Landscape Architects, American Planning Association, Boy Scouts of America – Pack 21, was a U9 Coach for the Sharpshooters Lacrosse Team, is involved with the El Paso County Barriers to Business Committee, and Quality of Life Indicator Vision Council Chair.

Remodeler Member of the Year
This is the fourth year HBA has recognized members of the Association who are in the remodeling industry who contribute their time and resources to the betterment of the building and remodeling industry and the Association.

Nathan earned his Certified Aging In Place Specialists (CAPS) designation in 2012. As Chair of the Remodelers Council, he served on the HBA Board of Directors and the HBA Cares Board of Directors and the Parade of Homes Committee. In the community, he volunteered at the Deerfields Hills Renovation project. He is involved with his local church and is a commissioner for the Town of Palmer Lake Planning Commission. He was the team captain for multiple projects for the Griffiths Center, including the Boys Home in Falcon.

Builder Member of the Year
The Builder Member of the Year is presented to a member who has made consistent contributions toward the betterment of the housing industry and the association. The award is given for significant accomplishment during the past year.

In 2012, Mark Bussone served as Chair of the Code Review Committee. A very important issue, even before the Waldo Canyon Fire, is fire codes. Mark has led the charge on how fire codes are adopted. Finding a code that focuses on saving lives while keeping housing cost down is a balance that can be reached when everyone is at the table for discussions. He served on the Board of Directors and was the top member recruiter during the November membership drive, and the year overall. He was actively involved in the Waldo Canyon rebuild efforts and is a supporter of Falcon Youth Sports.

Industry Person of the Year
The Industry Person of the Year Award is presented to a member who has made consistent contributions toward the betterment of the housing industry and the association. The award is given for significant accomplishment over a prolonged period of time.
Jerry has been with the HBA since its inception – well, at least, since the inception of the Political Action Committee and the Public Policy Council. He has worked on numerous special projects including the El Paso County Impact Fee Community and El Paso County Water Quality Committee. He has held all executive offices including President and is a Senior Life Director for the National Association of Home Builders.
In the community, Jerry currently serves on five Title 32 Metro District boards and has recently been nominated for a seat on the Regional Advisory Council of the Area Agency on Ageing, and agency of the Pikes Peak Area Council of Governments. Jerry has represented the HBA on many issues, including: City and County Drainage Board, Major Thoroughfare Task Force, The Hillside Fire Task Force, EPC Highway Advisory Committee and was on the Colorado Springs Utility Policy Advisory Committee.

Founders Award
The Founders Award is presented to members of out industry who have shown a lifetime of leadership and community achievement. This is the most prestigious award given by our industry to recognize excellence in building our community.

David Jenkins and Kent Petre with Nor’wood Limited have provided homes, schools and neighborhoods for thousands of families in the Colorado Springs community. They developed the 2,000 acre Nor’wood community in northeast Colorado Springs. This includes residential, school and parks; the Powers Auto Park with more to come. David and Kent also acquired the 2,000 acre master planned community of Wolf Ranch. Together they also acquired and are developing the 500 acre master planned community Mesa Ridge Project in Fountain.

David reshaped the Powers corridor with the iconic retail development known as First and Main Town Center. In addition, under David’s leadership, Nor’wood has developed the Barnes Marketplace at Barnes and Powers; Interquest Marketplace at Interquest and I-25. Another passion of David’s has been Downtown, including the Plaza of the Rockies, Alamo Corporate Center and Southwest Downtown Redevelopment

David’s involvement is not limited to business interests. He is a past Chair of the Board of Trustees for First Presbyterian Church; Led effort to change our form of government for a Strong Mayor; Past President of the East Colorado Springs Rotary Club; Raised more than $1 million for cystic fibrosis; Past President – and recipient of the Silver Spur Award of the Pikes Peak Range Riders; Member of the Urban Land Institute; Past President of the Pikes Peak Association of Realtors; was instrumental in founding the Economic Development Corporation and has remained a strong supporter over the years

The masterplanned community called Nor’wood is the centerpiece of Kent Petre’s real estate career. But he also brought his energy and talents to the Mesa Ridge Master-planned Community in Fountain. Kent is past recipient of the Industry Person of the Year by the Housing & Building Association of Colorado Springs in 2000. He was also recognized as Colorado Exchanger of the Year by the Pikes Peak Association of Realtors. Kent was a strong supporter of School District 11, a strong supporter of Partners in Housing and an effective supporter and advocate for parks. We lost Kent last year, but we will never forget him.

Together, David Jenkins and Kent Petre were a formidable team who provide first rate communities and home, schools, parks and recreational opportunities

NAHB Senior Officers Discuss Priority Issues With Key Government Officials

cshba — Fri, 04 Jan 2013 23:09:03 +0000

The week before Christmas was a busy one for NAHB’s Senior Officers as they traveled to Washington for high-level meetings with key government officials on a variety of major housing finance and tax issues that will substantially affect the residential construction industry. Led by Chairman Barry Rutenberg, the entire Senior Officer team first met with Edward DeMarco, who is the acting director of the Federal Housing Finance Agency (FHFA) that regulates Fannie Mae and Freddie Mac, on Dec. 18. Later that same day, they met with Richard Cordray, director of the Consumer Financial Protection Bureau, and also with Comptroller of the Currency Thomas Curry. On the following day, our representatives visited the Federal Reserve to provide Chairman Ben Bernanke with an overview of current conditions in the housing market and continuing obstacles to a more robust recovery, including overly tight credit conditions for both buying and building new homes. This personal outreach to top federal officials is central to NAHB’s strategy to remain “at the table” and pro-actively engaged on issues of primary importance to our members as policy proposals are being formulated that will likely impact our industry for generations to come. Chairman Rutenberg will provide more details on these latest discussions at our upcoming Board of Directors meeting in Las Vegas. Contact: MondayMorningQuestions@nahb.org.

OSHA Extends Temporary Enforcement Measures on Fall Protection

cshba — Fri, 14 Dec 2012 22:16:59 +0000

As reported in NAHB’s latest Washington Update, home builders and remodelers have been given a 90-day reprieve from federal OSHA enforcement of new, more stringent fall protection regulations, which have been in effect since September 15, 2011. The previously announced temporary enforcement measures, which provide priority free on-site compliance assistance, penalty reductions, extended abatement dates, measures to ensure consistency and increased outreach, have been extended until March 15, 2013, to allow the industry more time to learn about the rule. NAHB has long held that OSHA’s fall protection standard — including requirements that all residential construction companies must ensure that any employees or subcontractors doing work that’s six feet above ground or floor level must be protected with guardrail, safety net or personal fall arrest systems — could actually cause greater danger on the job site than using alternate methods that home builders say are safer. NAHB again made that argument and recently sent a letter and petition to OSHA officials asking them to reopen the rulemaking and try again to create a rule that applies to home builders, rather than a one-size-fits-all approach that is better suited to commercial contracting. “We are very pleased that OSHA heeded our calls” in delaying enforcement of the new guidelines, noted NAHB Chairman Barry Rutenberg when OSHA made its announcement on Dec. 11. Get the full story in the Washington Update. Contact: Rob Matuga (800-368-5242 x8507).

What You Should Know: Requirements Under the Patient Protection and Affordable Care Act

cshba — Fri, 14 Dec 2012 22:10:56 +0000

What You Should Know: Requirements Under the Patient Protection and Affordable Care Act
With the November election in the rearview mirror, implementation of the new health care law, the Patient Protection and Affordable Care Act, is about to hit the accelerator. Most of the mandates don’t start until 2014, which is when most Americans will be required to carry insurance or pay a penalty. Additionally, companies with 50 workers or more will be required to offer insurance to their workers or pay a penalty. The need to implement these provisions and others in advance of statutory deadlines, however, will result in “a wave of guidance” over the next few months, a Treasury Department official recently stated.

Thanks to NAHB Actions, Many Builders Will Be Exempt
NAHB has compiled the attached list of mandated provisions that are to take effect in 2013 and 2014. Some employers will be impacted, but since the majority of home builders employ fewer than 50 persons, these builders will be exempt from providing mandatory health care to their employees when the law goes into effect in 2014. As you may recall, an early draft of the measure contained a provision that targeted the construction industry by requiring a health coverage mandate for any employer with five or more employees, rather than the 50-employee threshold enjoyed by all other small businesses. NAHB launched a major lobbying blitz to remove this onerous provision from the final legislation, arguing that singling out the construction industry was unfair and that the provision threatened the viability of countless small home builders across the nation. As a result of NAHB’s efforts, the provision was dropped and the 50-worker threshold was signed into law.

Rumors About the New 3.8% Medicare Tax Are Untrue
Rumors have been circulating on the Internet that the new 3.8% Medicare tax on so-called unearned income set to take effect in 2013 is a direct tax on the sale of a home. As explained in the Dec. 11 edition of NAHB’s Washington Update, this just isn’t true. The tax will not affect income that is currently tax-exempt, including most capital gains due to the sale of a principal residence.

Looking Ahead
In the months ahead, NAHB will continue to be actively engaged as the new law is being implemented –especially as outstanding regulations on the definitions of employer, employee (full-time, part-time, seasonal) and safe harbors are considered. Stay tuned to this report and the Washington Update for all the latest developments. In the meantime, your contact for more information on the health care law is Suzanne Beall (800-368-5242 x8407).

HBA Installs John Bissett As 2013 President

cshba — Fri, 16 Nov 2012 23:46:51 +0000

The Housing & Building Association (HBA) of Colorado Springs continued its 61-year tradition of electing high profile, industry leaders to represent the most influential Association in the Colorado Springs region. The HBA represents more than 460 member companies and some 10,000 +/- citizens in the region; membership in the HBA is diverse and covers all areas of the home & commercial building industry, including landscaping, home products, banking, contractor trades, architects and building supplies, as well as builders and developers.

John Bissett with JM Weston Homes was installed as the 2013 HBA President at the HBA Annual Membership Reception, held Wednesday, November 14 at the Pikes Peak Regional Building Department. 2012 HBA President John A. Cassiani with RealTech Development moved into the position of Immediate Past President, and Joe Loidolt with Classic Homes was installed as the HBA President Elect. Newly elected board members were: Mark Bussone, Vantage Homes; Heath Herber, Westerra Development; Josh Peterson, Saddletree Homes; Vince Shoemaker, Bryan Construction; Dylan Fischer, Ferguson Enterprises; and John Radcliffe, Independent Civil Engineer.

Also honored were the volunteer “Chairs” of more than 14 different Committees and Councils that carry out the mission of the Housing & Building Association. These volunteers give hundreds of hours each year to support the building industry. Ralph Braden, Nor’wood Limited – Chair of the Political Action Committee; Mark Bussone, Vantage Homes – Chair of the Code Review; Jerry Costanzo, G.L. Costanzo & Assoc. – Chair of the Sales & Marketing Council; Mike Finkbiner, Robbins Roofing Specialists – Co-Chair of the PAC Golf; Marc Towne & Mark Fuerstenberger, Classic Homes – Co-Chairs of the 2Man Scramble Golf; George Hess, Vantage Homes – Co-Chair of the PAC Golf; Bobby Ingels, Nor’wood Limited – Chair of the Public Policy; Brad Kreikemeier, Bank of Colorado – Chair of the Finance Committee; Nathan Liljestrand, Custom Creations – Chair of the Remodelers Council; Matt Manzione, Mountaintop Custom Homes – Chair of the Jobsite Safety; Tim McConnell, Drexel, Barrell & Company – Chair of the Fountain Committee and Tri-Lakes Committee; John Radcliffe, Independent Civil Engineer – Chair of the Utilities Committee; Tim Seibert, Principle of N.E.S. Inc. – Chair of the Land Use; Jason Weber, Weber Construction – Chair of the Parade of Homes; and Dawn White, Keller Williams Partners Realty – Chair of the Member Services Council.

Achievements such as these are great testimonials to the housing and building industry, both in our local community, as well as at the national level. We all benefit from those whose time, loyalty, and leadership are so graciously and willingly given in an effort to accomplish HBA’s mission of keeping housing affordable.

Click to view slideshow.