August 2021
New Home Sales Fall in June Amid Supply Chain Challenges
Sales of newly built, single-family homes fell 6.6% in June to a seasonally adjusted annual rate of 676,000, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. The June number follows downward revisions to the May estimate and marks the lowest rate since April 2020. Despite the recent cooling trend, new home sales are up 13.5% on a year-to-date basis. Some slowing in June can be attributed to builders issuing fewer sales contacts in order to manage supply-chains amid longer delivery times and higher construction costs. Inventory ticked up slightly, but remains low at a 6.3-month supply, with 353,000 new single-family homes for sale, 46.5% higher than June 2020. Inventory of homes available for sale, but not begun construction was up 84% year-over-year, a clear sign of supply-side limitations in the building market. In contrast, completed, ready-to-occupy inventory is down 44% year-over-year, to just 36,000 homes. The median sales price was $361,800, up 6% from the $341,100 median sales price posted a year earlier. Regionally, on a year-to-date basis, new home sales rose in all four regions, up 19.5% in the Northeast, 23.9% in the Midwest, 15.6% in the South and 4.1% in the West. These significant increases are due in part to lower sales volume during the Covid crisis a year ago. A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed.
H-2B Visas for Returning Workers The U.S. Citizenship and Immigration Service (USCIS) announced July 27 that employers may file H-2B petitions for returning workers under the FY 2021 H-2B supplemental visa temporary final rule. Employers may take this action if they are likely to suffer irreparable harm without these additional workers. USCIS will accept petitions for returning workers until Sept. 15, 2021, or until the cap is reached, whichever occurs first.
DOL Rescinds Joint Employer Rule The U.S. Department of Labor (DOL) has announced it will rescind a joint employer rule that took effect in March 2020. NAHB viewed the 2020 rule favorably because it provided home building firms and small businesses clarity and certainty. The rule, which went into effect in March 2020, was subsequently challenged by 18 states on the grounds that the rule was invalid. The federal district court for the Southern District of New York agreed. DOL said the March 2020 joint employer rule will be rescinded effective Sept. 28, 2021. NAHB Award Program Applications Open Winning an NAHB award is the most prestigious honor you can earn in the home building industry and one of the savviest ways to get your company noticed. Don’t miss your chance to get the recognition you deserve. Applications are open for the Best in American Living Awards, The Nationals, and a dozen other outstanding award programs.
White House Holds Supply Chain Summit NAHB, along with a diverse group of stakeholders, participated in a July 16 virtual discussion hosted by the White House regarding current challenges across the home building supply chain, implications for the broader housing market, and possible solutions. The meeting was the culmination of NAHB’s year-long effort to educate policymakers about how rising lumber and building material prices are harming home builders, home buyers and the economic recovery. Learn more about NAHB’s efforts to resolve the lumber crisis by visiting our lumber page at nahb.org.
CDC Eviction Moratorium Ends The eviction moratorium order mandated by the Centers for Disease Control and Prevention (CDC) expired on July 31. The CDC is now putting a renewed emphasis on the resources available to ensure those impacted by the COVID-19 pandemic are able to remain in their homes. To assist in outreach, NAHB has a sample script that landlords can use to contact tenants and walk them through the steps to apply for assistance and/or request permission to apply on their behalf.
Remodeling Industry Confidence Improves Year over Year
Small Business Norm for Industry New NAHB research shows that despite declining self-employment rates and the rising top builder market share, residential construction remains the industry of independent entrepreneurs. Close to 80% of home builders and specialty trade contractor firms are self-employed independent contractors. Even among firms with paid employees, the industry continues to be dominated by small businesses, with 63% of home builders and two out of three specialty trade contractors generating less than $1 million in total business receipts. The new estimates are based on the 2017 Economic Census data. About 37% of home building companies reporting annual sales in excess of $1 million.
The NAHB/Royal Building Products Remodeling Market Index (RMI) for the second quarter posted a reading of 87, up 14 points from the second quarter of 2020. The finding is a signal of residential remodelers’ confidence in their markets for projects of all sizes. “Remodelers in many parts of the country are experiencing very strong demand for their services,” said NAHB Remodelers Chair Steve Cunningham, CAPS, CGP, a remodeler from Williamsburg, Va. “So far, remodelers have been able to accomo- date most customers, but as the backlog of projects in the pipeline grows, there is a tend- ency for them to take longer to start and complete.” The NAHB/Royal Building Products RMI survey asks remodelers to rate five compo- nents of the remodeling market as “good,” “fair” or “poor.” Each question is measured on a scale from 0 to 100, where an index number above 50 indicates that a higher share view conditions as good than poor.
Feds Plan to Update CRA Rule The Federal Reserve Board, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) have jointly announced that they will work together to modernize the regulations that implement the Community Reinvestment Act (CRA). The CRA requires federal banking regulators to encourage financial institutions to help meet the credit needs of the communties in which they do business, including low- and moderate-income (LMI) neighborhoods. As part of this joint effort, the OCC has announced that it is rescinding its CRA rule issued in May 2020 and working with the Federal Reserve and FDIC on an orderly transition to a new rule. The three agencies will next develop a joint Notice of Proposed Rulemaking.
Leadership List 2021 GCBA Officers and Directors OFFICERS PRESIDENT Fred Pfister, Toll Brothers 1ST VP Rafael Roca, DR Horton 2ND VP Michael Nunziata, 13th Floor Homes ASSOCIATE VP Tony Macaluso, Universal Engineering Sciences VP FINANCE Steve Karp, Melamed & Karp PA IMMEDIATE PAST PRESIDENT Jay Huebner, HSQ Group DIRECTORS Steven Dassa, Mattamy Homes Frank Coppola, Coppola Brothers Herb Tremble, Master Contractor and Subcontractor Association of Florida Karl Albertson, DR Horton Irina Heyaime, Pulte Homes David Donvito, Minto Peggy West, GRS Community Management Josh Hedden, Hydroshield Ken Lebersfeld, Capitol Lighting Lisbeth Linert, Clive Daniel Home Rick Baxter, Palm Beach Post Executive Officer: KT Catlin Design: Gregory J. Del Deo
Coffee & Conversation Friday, August 6, 2021 PWB Golf Clinic Friday, August 6, 2021 Building Permitting Inspections and Procedures Friday, August 13, 2021 PWB Golf Clinic - Fridays in August! Friday, August 13, 2021 PWB Golf Clinic - Every Friday in August! Friday, August 20, 2021 PWB Golf Clinic - Attend 1 or All! Friday, August 27, 2021 PWB Membership Breakfast Hosted by Ellish Builders Thursday, September 2, 2021 FHBA EO & State Rep. Blaze Ingolia Thursday, September 9, 2021 PRISM 2021 Thursday, September 23, 2021 SouthEast Florida Parade of Homes 10/20/2021 - 11/20/2021 All dates and locations are subject to change.
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NAHB has published a code adoption kit for the 2021 International Energy Conservation Code (IECC). The kit will help jurisdictions make informed decisions as they consider adoption of the new 2021 IECC residential model energy code. The 2021 ICC family of model building codes was released earlier this year and is now available to jurisdictions for review and adoption. The development of the 2021 IECC was marked by controversy as a result of a disputed online ballot being heavily influenced by block voting from non-code enforcement government officials informed by a single voting guide. In the end, several problematic code changes wound up in the 2021 IECC. An analysis published by Home Innovation Research Labs clearly establishes that many of these changes are not cost effective for home owners and will negatively impact housing affordability with negligible energy savings benefit. Many of these changes result in a negative monthly cash flow for the home owner (i.e., the combined total for the mortgage and energy bill is higher), and a negative net present value, a metric sometimes used by economists to evaluate a life-cycle benefit of an investment. Like other ICC “model” codes, the IECC is designed to be amended by jurisdictions to account for local considerations, such as geography, climate and regional practices. The process for adoption of new building codes varies between jurisdictions based on schedule, governing bodies involved and the degree to which the provisions are amended. The NAHB code adoption kit will serve as a resource for HBAs and other stake- holders as they evaluate the 2021 model codes.
NAHB Publishes 2021 IECC Residential Code Adoption Kit
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Administration Unveils Plan to Cut Payments on Government - Backed Loans Up to 25% The Biden administration has announced new loan modification options for borrowers who have government-backed home loans in order to help home owners who are still struggling to make their mortgage payments due to the COVID-19 pandemic. Under the plan, those with Federal Housing Administration (FHA)-insured mortgages who have been financially impacted by the COVID-19 crisis will be eligible to receive up to a 25% reduction on their principal and interest (P&I) payments. In return, the life of their mortgage payments will be extended to allow for the lower monthly payments.
Florida's First 3D Printed House Under Construction In Tallahassee On Friday, July 23, FHBA Staff along with members of the Tallahassee Builders Association visited Florida's first 3D printed home. Construction began two-weeks ago. Despite some rain delays, the 3D printing process was complete by July 23. The automated printer, owned by Florida startup "Printed Farms" out of Wellington, was manufactured by Danish company COBOD and can lay up to two feet of wall each day. Printed Farms now has their sights set on two more projects in the South Florida Market said Fredrik Wannius, one of the engineers on site. "There's a lot to learn about this process, but it's great to see innovation at work here in Florida's Capital City," said Rusty Payton, FHBA CEO.
FHBA 2022 Legislative Priorities Finalized During July Board of Directors Meeting FHBA's 2022 legislative priorities were approved during the Board of Directors meeting on Saturday, July 17. Although the FHBA Governmental Affairs team remains poised to tackle any threat that may arise during session, these priorities serve as "marching orders" for the team. Florida legislators will return to Tallahassee to kick off pre-session committee weeks beginning September 20, 2021.