Weekly Update: July 6, 2017

The 4th Annual Doug Mayo Golf Outing in the Books

We lucked out with the weather and had a great day at Copper Creek last Friday for the 4th Annual Doug Mayo Memorial Golf Outing.  The scholarship recipients had great things to say in front of the full crowd of 36 teams, everything flowed very well and it was basically a 4.5-hour round.  The event raises over $20k each year to provide scholarships to students entering the building trades.  We really appreciated having seven of our scholarship recipients and their parents take the time to travel and participate – Alec Brundell (Paul Brundell); Audrey Hefel (Doug and Sheila Hefel); Tanner Iverson (Jay Iverson); Drew Madden (Rick Madden); Michael Madden (Todd Madden); Caleb Statler (Jeremy Statler); and Abby Tornow (Sherry).

Commencement of Work Notices for Residential Projects – It Started Last Saturday

On July 1, 2017, House File 586 went into effect. This new law requires all “general contractors” as defined under the law (that is, all contractors who directly work for a homeowner) to timely file a C.O.W. Notice at the outset of each residential project to preserve their lien rights, regardless of whether subcontractors will be used on the project. Thus, even contractors who self-perform all work without any “subcontractors,” as well as suppliers who supply directly to homeowners, will now have to timely file this C.O.W. Notice within 10 days of the start of their residential projects to preserve their lien rights.

Thus, as of July 1, 2017, all general contractors, subcontractors, and suppliers on residential projects who want to preserve their mechanic’s lien rights on residential projects must timely file their C.O.W. Notice (for general contractors and others working directly for an owner) or Preliminary Notice (for subcontractors) at the outset of such projects. Otherwise, all lien rights are lost.  Please see this article for further details. Please contact attorney Jodie McDougal if you have any questions regarding this law.

ICC Energy Code Free Webinar July 13

Builders have a choice between two different paths to satisfy the 2015 International Energy Conservation Code (IECC).  The prescriptive path lays out specifications for both the materials and installation, like a recipe. But the performance path can reduce construction cost by allowing builders to cost-optimize a solution that is best for them in order to meet the energy code requirements.

The webinar Using the Performance Path for Compliance in the IRC and Energy CodeThursday, July 132-3 p.m. ET, will explore how the performance path provides builders more choices when deciding how to comply with the new energy code requirements. Learn about these options and how to use them to build a code-compliant, energy-efficient home at a lower cost.  Participants in this webinar will:

  • Recognize the flexibility built into the energy code and when to apply the various paths of compliance
  • Become familiar with the performance path and new Energy Rating Index path in the IECC
  • Walk through the way energy modeling compliance works in this path
  • Review the “Mandatory” requirements specified in the energy code
  • See the potential benefit of using the performance path to save on energy code compliance

Although this is a free webinar, you’ll still need to register to attend. Registration is open until 3 p.m. ET on Wednesday, July 12.  This webinar provides 1.0 hours of continuing education credits for the following 12 designations: CAPS, CGA, CGB, CGP, CGR, CMP, CSP, GMB, GMR, Master CGP, Master CSP, MIRM.  This webinar is the third in a series of three webinars available free of charge thanks to the generous support of the International Code Council (ICC). For access to the latest tools for code compliance, standards, education, and ICC’s Family of Companies, visit www.iccsafe.org or call 888-422-7233.

30 year fixed mortgages continue to be lowered, an interesting pattern over the course of a year.

 

10 Year High on Residential Fixed Investment

Final estimates of first quarter 2017 GDP growth (revised up two-tenths of a percentage point to 1.4%), show that housing’s share of gross domestic product (GDP) was unchanged at 15.6%.  The home building and remodeling component-residential fixed investment (RFI)-increased 0.1 percentage point to 3.6% as a share of GDP.  The first-quarter expansion of RFI added 0.48 percentage point to the headline GDP growth rate (i.e. GDP would have expanded only 0.9% had RFI remained unchanged).  Of the 31 quarters since the end of the Great Recession, only five times has residential fixed investment contributed more to GDP than it did in Q1 2017.

Housing-related activities contribute to GDP in two basic ways.  The first is through RFI-effectively the measure of the home building, multifamily development, and remodeling contributions to GDP. It includes construction of new single-family and multifamily structures, residential remodeling, production of manufactured homes, and brokers’ fees.

RFI comprised 3.6% of the economy in the first quarter of 2017.  In nominal terms, RFI rose from a $596 billion seasonally adjusted annual rate (SAAR) to $614 billion in inflation-adjusted 2009 dollars-a 3.1% increase.  This represents the highest level of real RFI (SAAR) in nearly a decade (Q3 2007).

The second impact of housing on GDP is the measure of housing services, which includes gross rents (including utilities) paid by renters, and owners’ imputed rent (an estimate of how much it would cost to rent owner-occupied units) and utility payments. The inclusion of owners’ imputed rent is necessary from a national income accounting approach, because without this measure, increases in homeownership would result in declines for GDP.  In the first quarter, housing services comprised 12.0% of the economy or $2.03 trillion (SAAR), falling 0.1 percentage point from the fourth quarter of 2016.

Taken together, housing’s share of GDP was 15.6% in the first quarter.  RFI and housing services have averaged 4.6% and 13.2% of GDP, respectively, over the past 35 years for a combined 17.9% of GDP. These shares tend to vary over the business cycle. RFI as a share of the economy, for instance, has risen 33% (from 2.6% to 3.6%) since the end of the Great Recession.

Iowa Plumbing & Mechanical Systems Board

License Renewal Update

Over 5,500 individuals have successfully renewed their license as of June 30, 2017.  This number represents slightly less than half of all individuals who were sent renewal notices.   The vast majority of applications that are submitted online are able to be renewed automatically and issued within a few days of submission.  Paper applications are processed in the order received. Due to the extremely high volumes at this time, paper applications can take 4 to 6 weeks to process.  Below are some helpful tips and reminders to assist you with navigating the renewal process.

Renewal Grace Period

If you have a license that expires on June 30, 2017, the license is still valid for work until the end of August 2017.  Individuals can renew the license during the month of July with no additional late fees or penalties.  Beginning August 1, individuals who have not renewed the license must submit a late fee of $60 per license in addition to the renewal fee.  Beginning September 1, the license is no longer valid for work in the state of Iowa and individuals must submit a late fee of $100 per license in addition to the renewal fee.  Please submit your renewal as soon as possible if you have not already done so.  If you submit an incomplete application or incorrect fees, the application will be returned to you and you will owe late fees after the end of July.

Contractor Renewals

The job of creating a combined application process for contractors that are covered by Iowa Code Chapters 91C and 105 has resulted in some processing delays. However, be advised that all contractor licenses are still valid during the renewal grace period.  The Iowa Division of Labor has extended a similar grace period to contractors who are renewing registration through the one-stop shop.  If your contractor license was due to expire on June 30, 2017, it is still valid for work in the state of Iowa until the end of July.

Board staff are working closely with the Division of Labor and will begin issuing new license certificates and registration numbers starting today.  Contractors who have submitted a complete renewal application should expect to begin receiving their license certificate in the upcoming weeks.  Licenses and wallet cards will be sent via email to the email address we have on file for the company.  If you do not have an email address, the certificate and renewal card will be mailed to the company’s business address.

Fee Calculation Worksheet

Incorrect fees are one of the most common reasons renewal applications are returned.  A fee calculation worksheet is available on our website at https://idph.iowa.gov/pmsb/fees.  The board office does not issue routine refunds which means if you submit an application with incorrect fees, the application will be returned.

Weekly Update: June 29, 2017

  The new #OwnItIowa campaign was announced last Monday morning.  HBAI is a sponsor of the project, along with the Iowa Finance Authority, Iowa Association of REALTORS, Habitat for Humanity, and the Iowa Mortgage Association.  In the photo, left to right, are:  Cathy De Haai (Habitat for Humanity); Dave Jamison (Iowa Finance Authority); Lieutenant Governor Gregg; Governor Reynolds; Gavin Blair (Iowa Association of REALTORS); Vicki Davis (Iowa Mortgage Association); and Jay Iverson (HBAI).

#OwnItIowa Homeownership Campaign

The #OwnItIowa campaign is offering any Iowan who is 18 and older two chances to win $2,500 this summer! The promotion’s goal is to increase awareness of programs available to assist Iowa home buyers. The campaign is a partnership between the Iowa Finance Authority, Iowa Association of REALTORS®, Iowa Mortgage Association, Habitat for Humanity of Iowa and the Home Builders Association of Iowa – organizations who all share the goal of educating home buyers about the homeownership process, programs and resources available to them.

Two Ways to Win $2,500 at IowaHouseHunt.com!

  1.  Enter random sweepstakes. Entrants who enter the name of a lender and Realtor will receive two extra entries into the sweepstakes.  Aug. 31: Sweepstakes entry deadline
  2. Enter photo contest: Upload a photo of the entrant showing something they dislike about not being a homeowner.  It could be a roommate’s bad habit, tight living quarters,  limited privacy or the thought of using a toilet shared by many before you.  The cleverer, the better as photos will be judged by the public and the photo with the most votes will win! July 21: Deadline for photo entries; July 24 – Aug. 4: Voting to determine top 20 entries; Aug. 7 – Aug. 31. Voting to determine the $2,500 winner

There are no strings attached. Entrants may already be homeowners, they just need to be 18 and a resident of Iowa. Attention lenders and Realtors: Any Iowa lender and Realtor® who refer the most contest entries will each receive a new billboard around their area! Contact Ashley Jared with the Iowa Finance Authority with any questions: ashley.jared@iowa.gov.

HBA of Greater Siouxland EO Nancy Moos Announces Retirement

Congratulations to HBA of Greater Siouxland Executive Officer Nancy Moos for over 30 years of dedicated and extraordinary leadership.  She made the announcement last week and plans to finish out 2017.  Planning is underway to find her replacement.  Congratulations Nancy!

Congratulations to the Greater Iowa City HBA!

Greater Iowa City HBA Executive Officer Karyl Bohnsack recently found out that they won the NAHB “Best Workforce Development Plan Implemented” award for their Construction Camp for kids.  They will be recognized at the Association Leadership Conference in Denver in August.  Great job!

Okay Electricians, We Need to Hear From You

The Electrical Examining Board will be holding a Public Hearing to seek input on adopting the 2017 National Electrical Code (NEC). The Public Hearing will be held on August 17, 2017 at 10:00 AM.  If everything goes as planned, the 2017 NEC will go into effect on January 1, 2018.  Please take a look at the proposed changes, the code, and then let us know if you would like additional changes.

  

 The annual trap shoot with the Cedar Rapids Housing and Building Association last week was a great time, despite the pouring rain when many of us were trying to shoot.  The meat cook off featured 12 entries and was won by Randy Dostal.  Nearly 100 members participated in the event.

Mike Rowe Dinner Tables – A Great Concept Here

As the planning for the Mike Rowe dinner September 28 gets more detailed, we wanted to clarify a little confusion on the tables that we will be selling for the dinner event.  Our plan is to have industry leaders purchase a table, but then have a minimum of two school officials, counselors, administrators, teachers, prospective students, etc. at each of those tables.  We just wanted to split up those influential folks and mix them in with our leaders.

Now that doesn’t mean that you can’t do whatever you want with your table, but past HBAI President Rob Hajek is leading the way.  He plans to purchase two tables, but then fill them up completely with prospective students from schools that he’s involved in.  That’s exactly what we want to happen.  We do not need to fill the room with individuals that already know the message.  Stay tuned in for more details, but put some thought into who you would like to sit at your table.

Another Crippling Bump to our Industry

In a move that will raise housing costs and price countless American households out of the housing market, the Commerce Department last Monday, June 26 imposed a preliminary 6.87% anti-dumping duty on Canadian lumber imports on top of the 19.88% countervailing duties announced in April.

In an official statement, NAHB Chairman Granger MacDonald said that the combined duties are “basically another tax on American home builders and home buyers that will jeopardize affordable housing in America.”

The 19.88% countervailing duty is intended to compensate for government subsidies that Canadian firms allegedly receive, while the 6.87% anti-dumping duty is intended to bridge a supposed gap between the price that Canadian lumber producers are selling lumber in the U.S. and the “fair market price” determined by the Department of Commerce. Combined, the two duties impose a 26.75% total tariff on Canadian lumber imported into the U.S.

In an Eye on Housing blog post, NAHB senior economist Paul Emrath discusses the impact the duties will have on the housing market and the economy. The analysis shows that the tariffs would boost lumber costs by 8.8% for U.S. consumers and add $1,700 to the cost of a typical single-family home.  Further, the annual effects of this tariff in 2017 include a loss of:

  • 11,336 full-time U.S. jobs
  • $685.5 million in wages and salaries for U.S. workers
  • $481.8 million in taxes and other revenue for governments in the U.S.

These losses of wages, jobs and taxes are net losses that take into account the increases in wages, jobs and taxes in the domestic sawmill industry. The reduction in jobs is not limited to the construction industry: Jobs are also lost in businesses that sell and transport building materials, provide architecture and engineering services, etc.

One Occupancy  

In 1940, the percentage of one-person households in the USA was 7.7%, by 1960 it was 13.3%, and by 1980, 22.7%. In 2000, the rate was 25.8% and in 2016, 28.1%! DC has the highest percentage of one-person households at 42%, followed by RI at 31.8% and MT at 31.5%. Globally, Sweden, where one-person households are 47% of all households, holds down first place, followed by Norway at 40%. Elliot F. Eisenberg, Ph.D.

New Resources Help You Recruit Skilled Labor

You can find some great resource materials here (members only) Skilled Workforce Development Resources to help you recruit skilled labor and spread the word about the valuable careers available in residential construction. NAHB economists recently analyzed the latest salary data from the U.S. Bureau of Labor Statistics to provide HBAs and members with updated information about their local residential construction labor market.  The new salary data are promoted in the following resources:

State Wage and Workforce Demand Data: State-specific data, including the annual average wages in construction and the projected workforce demand by state and for the top 100 metro areas.

Careers in Construction Posters: This series of posters will help you promote residential construction careers at schools, career fairs, career exploration days, educational conferences and local community events.

Plus, you can share our public Building a Skilled Labor Workforce page with educators, policymakers and industry partners to provide them with resources to help promote these career opportunities in their communities. Resources include the Careers in Construction posters, brochures, lesson plans, a presentation template and more.

Want a $1 Million Paycheck? – Skip College – Read this Story

Here’s a great story from Bloomberg last Tuesday, promoting high paying blue collar jobs and skipping the college debt.  Check it out here.

   The annual President’s Charity Golf Outing last week in Sioux City raised a pile of money for the local soup kitchen.  We had a chamber of commerce weather day and a great time spent with HBA of Greater Siouxland members.  Each year the incoming president chooses which charity will be supported.