Weekly Update: May 4, 2017

  The Iowa Building Code Advisory Council met last Tuesday at the Iowa Department of Public Safety Building.  No major changes are on the immediate horizon, but the 2018 code set is due to be released late this Summer.  From left to right:  Rich Bolten (Iowa Building Code Commissioner), new Building Code Department staff member, new Council member Kari Sebern (Sebern Structural Services), David Kuhn (Urbandale Building Inspector), Chairman Mark Reetz (Homes by Fleetwood), Don Beal (Beal Development), Marsha Bannister (Homeworks Realty), and Ljerka Vasiljevic (Deputy Building Code Commissioner).  Participating on the phone were Scott Webster (Premier Custom Homes) and Amy Infelt (Design Engineers).  Non-members in the room were John Easter from the American Chemistry Council and HBAI EO Jay Iverson.  Thanks to the fine group of HBAI members who participate!

Member Benefit – LegalShield

We are pleased to offer yet another member benefit – substantial discounts on subscriptions to LegalShield/IDShield.  Everyone deserves affordable legal and identity theft protection, including you. No matter how traumatic or trivial your situation, we are here to help. Unexpected legal and identity theft issues arise every day. With LegalShield on your side, you have the power to access legal and identity theft advice and services when you need them, all for one low monthly fee.  Here is a link to our HBAI plan, check it out.  Here are some scary statistics:

  • In 2015 there were 781 breaches affecting all Americans.
  • In 2016 there were 1,093 breaches – a 40% increase year over year.
  • From the Javelin Research Group, this year there were over 1 billion records stolen due to the Yahoo security breach.

With IDShield, we really do monitor everything that matters, not just the financial which is virtually all the other ID theft protection services provide. We monitor your medical ID, drivers license and passport numbers. And we are excited to share that we are now (as of March, 2017) adding the monitoring of social media through our partnership with Kroll.

  • ID thieves change the address of their victims.
  • That in part provides an average 18 month time delay before the victim is alerted to their new challenge to address.
  • 72% of ID theft involves some legal aspect needing resolution.
  • 82% of adult Americans do not have a current will – or – any will at all.
  • Stress from these type of challenges affect productivity, absenteeism and the mental and physical health of the victims.

Private Residential Construction Spending at Post-Recession High

NAHB analysis of Census Construction Spending data shows that total private residential construction spending grew 1.2% in March to a seasonally adjusted annual rate (SAAR) of $503.4 billion. This is 7.5% higher than a year ago and represents a new post-recession high.

The monthly gains are largely attributed to the strong growth of private construction spending on both multifamily and home improvements. Multifamily construction spending continued its record breaking pace to a SAAR of $66.1 billion. It increased by 2.0% over the revised February estimates and was 7.4% higher since a year ago. Spending on home improvements has now increased for six straight months, reaching the SAAR of $178.9 billion in March. On a year-over-year basis, home improvement spending rose by 11.8%. Single-family construction spending increased slightly by 0.3%, continuing its steady growth since October 2016.

The NAHB construction spending index, which is shown in the graph below (the base is January 2000), illustrates the strong growth in new multifamily construction since 2010 and a more modest growth in single-family construction spending.

Private nonresidential construction spending slipped 1.3% on a monthly basis, however, it was 6.4% higher than a year ago. The largest contribution to this year-over-year nonresidential spending gain was made by the class of communication (19.1%), followed by office (17.7% increase), and educational (15.3% increase).

4th Annual Doug Mayo Memorial Golf Outing Sponsors

Thanks to the following members who help make this event great!  All proceeds go towards scholarships for students involved in building trades programs.

Order Doug Mayo Golf Outing Apparel Now/Sponsors Still Needed

The golf portion of the 4th Annual Doug Mayo Golf Outing, which benefits students entering the building trades, is sold out.  There is still time to add your company name to the list above – we are still in need of sponsors.  Official apparel needs to be ordered now to look super fashionable on our event, which is Friday June 30th, 2017. Click here for you to be a sponsor.  Click here to order super awesome logoed clothing.

Weekly Update: April 27, 2017

   We had a great time at the 30th Annual Fort Dodge HBA steak fry last week.  They served over 400 steaks!  It’s a very well attended event.  2017 HBAI President Tim Ruth (on left), Associate National Director Mike Farr (second from left), and HBAI Executive Officer Jay Iverson joined the group for the evening’s festivities.  There will be a housing boom there as 2,000 new jobs come to the area.
 
2017 HBA Iowa Legislative Recap

The 2017 Iowa Legislative session closed Saturday, April 22 after an all-night marathon.  Big issues like water quality, cannabis, and budget issues were still being worked on as they tried to find common ground before calling the session’s end.  Early in the session, lawmakers shortened the session by ten days to save some money and the per diem ended April 18.

Everyone had hoped for a smooth and easy session with Republicans controlling the House, Senate, and Governor’s office – such was not the case and much lower than expected revenues further complicated things.  Overall it was a monumental undertaking – with issues like abortion, tax relief, mental health and education funding, collective bargaining, medical marijuana, etc.

It was a great session for members of the Home Builders Association of Iowa and other construction association groups, real estate professionals, and workforce development planning coalitions.  Iowa’s 15-year Statute of Repose (the longest in the Country) was finally reduced after a seven-year battle.  Commercial applications will now have an eight year SoR and residential is now at ten years.  This will hopefully open up the insurance marketplace for our members, saving significant premiums with the lower exposure.

The Iowa Association of Realtor’s were victorious in their number one issue that was fought for the past four sessions – a first time homebuyer savings account.  Similar to Iowa’s 529 plan for education, it will allow individuals to put away $2,000 and couples $4,000 annually into an interest bearing savings account to be used for a down payment on a single family home.

Another great victory was one of Master Builder’s top priorities – a prohibition on government-mandated Project Labor Agreements.  This will be helpful for a number of HBAI members as well.

Water quality funding ended up in a stalemate between the House and Senate, so nothing was done for this session.  It will be back next year for sure.

The HBAI Legislative Committee registered in favor of 31 bills (or variations); opposed eight; and marked undecided on 18 others.  We successfully fought off a number of harmful bills, which always have the possibility of resurfacing.  It was the most successful legislative session in many, many years.  There were many pro-business, regulatory relief, and tax victories.  We will continue to adding to this list – the environment is ripe for taking this state to the next level with many more economic development incentives.  It’s all about the economy – when it’s strong, our members can’t help but be successful.

It was a great session and the level of coalition building and support from like-minded groups was exceptional.  Our members were exceptional – answering the call multiple times to contact their legislators with information that helped push our pro-construction agenda forward.  Thanks to everyone who helped make it possible.

 

Fight with Canada a Big Deal – Lumber Increases Average $3,600 More

This issue is not new, quite interesting, and unfortunately a big deal for our industry.  It has been going on for over 30 years and the trade agreement that has governed Canadian imports of softwood lumber since 2006 effectively expired at the end of 2016.  We’ve talked about it in several newsletter editions and prices are climbing.  About 30 percent of the softwood lumber used in residential construction comes from Canada.

We expect to see an increase in the cost of American-produced softwood lumber as well – just part of the market dynamics and it has happened before.  Because of the uncertainty surrounding a new trade pact, we’ve already seen a 22% spike in lumber prices since the beginning of the year. These price hikes have negative repercussions for millions of Americans. It takes about 15,000 board feet to build a typical single-family home and the lumber price increase in the first quarter of this year has added almost $3,600 to the price of a new home.

We would urge the U.S. and Canada to work cooperatively to achieve a long-term, stable solution in lumber trade that provides for a consistent and fairly priced supply of lumber.  We also need to increase domestic production by seeking higher targets for timber sales from publicly-owned lands and open up additional federal forest lands for logging in an environmentally sustainable manner.

The U.S. Department of Commerce this week announced countervailing duties of up to 24 percent to be imposed on shipments of softwood lumber from Canada, retroactive to 90 days. This action was taken at the behest of the U.S. Lumber Coalition, an alliance of domestic softwood lumber producers.

NAHB is also exploring the idea of leveraging our members’ buying power in the market. Staff is beginning to examine the feasibility of creating a national buying co-operative that uses our federation structure as the supply chain. State and local HBAs could opt in to such a co-operative.

Acceptable Abodes  

The March housing data numbers were good. While starts were down 6.8% compared to February’s outstanding weather-induced number, starts were up 9.2% compared to March 2016. Moreover, starts are up 8.1% year-to-date and were up about 8% each month this year compared to last. Single-family starts are up almost 6% YTD; multifamily starts, a surprisingly strong 15% versus a weak 16Q1. Starts should rise 6% this year. Solid.  Elliot F. Eisenberg, Ph.D

Member Advantage Discounts

Your 3-in-1 membership includes an exclusive program from the National Association of Home Builders (NAHB) called Member Advantage. This offers you ways to reduce expenses, increase efficiency, and maximize profits through discounts on products and services with leading, national companies. To learn more about these discounts and how to access the savings go to NAHB Member Discounts. Click here for an overview of all discounts.