FREDERICKSBURG - STAFFORD - SPOTSYLVANIA - CAROLINE - KING GEORGE - ORANGE - CULPEPER
January 2023
BUILDERS FRAMEWORK
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FREDERICKSBURG AREA BUILDERS ASSOCIATION
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New Home Sales Up as Mortgage Rates Moderate
Volume 7: Issue 1 January 2023
While new home sales received a slight bounce in November from lower mortgage rates, the housing market continues to struggle because of ongoing supply chain disruptions, elevated construction costs and challenging affordability conditions. Sales of newly built, single-family homes in November increased 5.8% to a 640,000 seasonally adjusted annual rate, according to newly released data from HUD and the Census Bureau. On a year-to-date basis, new home sales are down 15.2%. A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of cons- truction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the November reading of 640,000 units is the number of homes that would sell if this pace continued for the next 12 months. New single-family home inventory remained elevated at an 8.6 months’ supply (of varying stages of construction). A measure near a 6 months’ supply is considered balanced. The count of homes available for sale, 461,000, is up 18.2% over last year. A year ago, there were just 32,000 completed, ready to occupy homes available for sale. By November 2022, that number increased to 64,000, reflecting flagging demand and more standing inventory due to lower sales. Regionally, year-to-date, new home sales fell in all four regions, down 3.6% in the Northeast, 22.3% in the Midwest, 13.1% in the South and 19.3% in the West.
Looking at the 2023 Economic Outlook Where is the housing industry heading in 2023? NAHB Chief Economist Robert Dietz recently discussed key data to help answer that question during a webinar with Pro Builder Editorial Director Rich Binsacca. The webinar provided an overview of the impact of interest rate hikes, supply chain issues, and rising labor and materials costs on residential construction. A summary document with key highlights is also available to download.
Action Needed on Transformers NAHB and other industry groups are urging policymakers to resolve an ongoing supply chain shortfall that is affecting delivery of much-needed transformers and other electrical switch gear. The scarcity of transformers is having a dramatic effect on new construction projects and repairs of homes, commercial buildings and infrastructure. Urge your members of Congress to support the implementation of the Defense Production Act to address the supply chain crisis for electric distribution transformers.
NAHB Responds to Rule on Independent Contractors The U.S. Department of Labor recently published a proposed rule updating the test for determining whether a worker is an employee under the Fair Labor Standards Act (FLSA) or an independent contractor. NAHB has submitted formal comments opposing the proposed rule. The language of the new test introduces new, undefined, vague terminology that would reclassify legitimate independent contractors into employees, affecting many industries, including residential construction that rely on the subcontractor business model. FHA Announces Increases To Loan Limits in 2023 The FHA on Dec. 1 announced its loan limits for 2023. The nation-wide rise in median home prices indicates most buyers across the country will see increases. The FHA floor will increase from $420,680 to $472,030 for single-family home loans. The floor amount is the lowest the FHA loan limit can be for any area of the country. FHA’s ceiling loan limits, the maximum loan amount the agency will insure, will increase from $970,800 to $1,089,300 for a single-family property, even higher in some states and territories.
Materials Prices Eased in November The prices of building materials decreased 0.3% in November (not seasonally adjusted) following 0.5% and 0.1% declines in September and October, respectively, according to the latest Producer Price Index (PPI) report. The index has decreased five of six months for the first time since 2015. The PPI for goods inputs to residential construction, including energy, fell 0.8% in November. The index was led lower by a 5.3% drop in energy input prices as the PPIs of regular unleaded gasoline and No. 2 diesel fuel decreased 6.7% and 4.5%, respectively.
Funding Bill Gives More to HUD Congress has approved a $1.72 trillion spending bill that will fund the government through fiscal 2023, which ends on Sept. 30, 2023. Of note to the housing community, the measure includes a total of $58.2 billion for the U.S. Department of Housing and Urban Development, an increase of $4.5 billion above fiscal year 2022. The HUD funding includes $85 million for a new "Yes In My Backyard" (YIMBY) grant program championed by NAHB that will incentivize affordable housing production. The new grant program rewards state and local jurisdictions advancing policies that increase the supply of affordable housing.
Real Estate Taxes Vary Widely Across the Union
Strong Job Growth, Year-Over-Year Construction sector jobs in the United States increased by 248,000, year over year — a 3.3% increase compared to November 2021. California added 37,200 jobs, which was the largest gain of any state, while South Carolina lost 4,700 construction sector jobs. In percentage terms, North Dakota had the highest annual growth rate in the construction sector by 15.6%. Over this period, South Carolina reported a decline of 4.5%. Year over year ending in November, 4.9 million total jobs have been added, marking a more than full recovery of the labor market from the COVID-19 pandemic-induced recession.
Real estate taxes vary widely across states, both in terms of annual taxes paid as well as effective tax rates. In 2021, the difference between average real estate taxes (RETs) paid by New Jersey and Alabama home owners was $8,336. New Jersey continued to have the highest average real estate tax bill per home owner ($9,151) as well as the highest effective tax rate (2.02%). Hawaii (0.28%) and Alabama ($815) were at the other end of the spectrum, boasting the lowest average effective tax rate and annual real estate tax bill, respectively. The differ- ence between the highest-taxed state (New Jersey) and lowest (Alabama) grew by $362 between 2019 and 2021.
The map illustrates the concentration of high average property tax bills in the Northeast. In contrast, southern states (excluding Texas) boast some of the lowest real estate taxes for their homeowners.
NAHB Connect Brings the Industry Together
In an industry where work often stays close to home, connecting with peers across the country can help jumpstart your business and add value to what you do every day. NAHB Connect is a free online platform that helps connect NAHB members with one another for discussions, learning, the sharing of ideas and more. Members on the NAHB Connect platform engage in discussions on a wide variety of topics. Whether it’s permitting challenges at the local level or comparing and contrasting different building techniques or materials, there’s always someone on the platform willing to provide their insight, experience and assistance to help a fellow member. Popular discussion topics in 2022 included adapting to the “new normal” of the economy, supply chain challenges, marketing strategies and trade show booth ideas. Not only do NAHB Connect members connect with one another in conversation, but Ask Me Anything events (AMAs) also feature guest experts who are ready and available to answer any question posed by the virtual audience. If you’re not yet a member of NAHB Connect, you can create your profile today at connect.nahb.org. Use the same credentials you use to sign in to nahb.org.
Upcoming Meetings & Events
February 10th FAB Valentine's Dance 6:00-10:00 Renatos February 8th Associates Committee Meeting, 9:00-10:00AM FABA Office or Zoom February 8th Membership Committee Meeting,10:30-11:30AM FABA Office or Zoom February 16th Hard Hat Networking Sponsored by Ray's Siding February 22nd Community Service Committee Meeting, 2:00-3:00 FABA Office or Zoom
Calendar at a Glance
Thank you to our 2023 Cornerstone Sponsors!
Membership Committee
The Membership Committee brings builder and associate members together to focus on recruitment of new members and retention of current members. This committee hold a hybrid meeting (in-person or zoom) every 2nd Wednesday at 10:30AM.
We are proud to be 300 Members strong as of January 2023!
Chair - Mike King, miketheknyfe@gmail.com
Every Third Thursday of the month, join us for our networking Hard Hat Events from 5:00-7:00 PM.
The Associates Committee plans member events to promote doing business with members. These volunteers coordinate networking and social events for business connections. Stay tuned for new and exciting changes coming to this committee. This committee has a hybrid meeting (in-person or zoom) every 2nd Wednesday at 9:00AM.
Chair- Teressa Taylor- Griffs . teressa@ttgva.com
Associates Committee
Registration is open for Spring Golf. Don't let this winter weather get you down, reserve your spring foursome today and start counting down the days until May 8th.
Associates Committee Hybrid Meeting Zoom Link: Second Wednesday of each month at 9:00 AM
Click here to register
Orange County Quarterly Zoom January 27th, 11:00AM King George County Quarterly Zoom January 20th, 9:00AM
Legislative Committee
Extension of Local Land Use Approvals – HB 1665 (Marshall) and SB 1205 (Lewis) Virginia Housing Commission Review of Land-Use, Zoning, and Development Review Statutes; Report to Secretary of Commerce and Trade by November 2023 – HJ 507 (Marshall) Local Land-Use & Housing Policy Clearinghouse – HB 2494 (Ware) Public Notice Requirements for Land-Use Applications and Ordinances – HB 1473 (B. Fowler)
Universal License Recognition (Reciprocity) – HB 2180 (Morefield) and SB 1213 (McDougle) Residential Land Development and Permit Fee Transparency – HB 1671 (Wyatt)
Upcoming County Zoom Meetings
HBAV and FABA Day at the General Assembly It is always fun traveling to Richmond to lobby with HBAV on behalf of our members. Below are a few of the bills we were there to discuss.
Developers Council The working mission of the Council is to stay on top of land development issues affecting local builders and developers in our region and work together to advocate for our positions as needed. The Council is open to Builder and Developer members of FABA. Jeh Hicks, Jarrell Properties , Inc., is the chairman of the Developers Council. This group meets every other month. For more information contact Mark Snesavage at Mark@FABAVA.com
Chair - Jeh Hicks, jeh@jarrellinc.com jeh@jarrellinc.comjeh@jarrellinc.comjeh@jarrellinc.com
Welcome our new chairman for 2023 - Jeh Hicks
The Legislative Committee meets monthly to discuss the status of local and state level legislation that affects the building industry. For more information from each county, plan to attend the Legislative Committee meeting. This committee meets virtually every third Thursday at 8:30AM.
Congratulations to our 2022 award winners
Spike Recruitment Award – Michael Pollaci Spirit of FABA– Patty Pollaci Volunteer of the Year – Lauren Bruning Rookie of the Year – John Butler Community Service Award- Greg Schmidt Government Affairs– Rick Furnival FAB Foundation– Mike King Committee Chairman of the Year–Chrissy King and Sheli Schneider-Summerfest Associate of the Year– Michael Pollaci Builder of Year -Tricord Life Director – Bruce ReesePresident’s Award – Maria Moore and Jason Moore
Help the Friends of FABA team raise money for this amazing cause! To donate,call us at 540-898-2730
Interested in joining the Community Service Committee? Join us in the FABA office on February 8th from 12:30-1:00 for lunch and all of the details for 2023
Chair - Greg Schmidt, greg@pestsolutionsva.com
The Community Service committee seeks to increase civic engagement among the members of FABA and utilize professional skills to actively benefit the Fredericksburg area. We are always looking for new ways to get help and support the community. If you are interested in submitting an idea for the community service committee feel free to join us!
Community Service Committee
This committee holds a hybrid meeting (in-person and virtual/zoom) every 4th Wednesday at 2:00PM.
OSHA 10 February 28th and March 1 CLICK HERE TO REGISTER
Check our these educational opportunities in 2023 Impact to work place, support after Covid - January 2023 Codes of Coffee Marketing and Branding 101 Visual and digital marketing Social Media overview Building industry 101 Hiring and retaining workforce
Lauren Bruning , Topside FCU. Lauren.Bruning@topsidefcu.org
The Education Committee coordinates workshops and virtual learning opportunities focused on industry safety, marketing, and personal growth. Stay tuned for upcoming educational opportunities.
Nathan Dobbins ndobbins@dobbinsrealty.com
Education Committee
Young Professionals Committee
To join the FABA Young Professionals committee email Meghan@fabava.com
Young Professionals committee is for individuals in the 21-40 age group to connect, and provides opportunities for professional development, social networking, mentoring, and personal growth for our members. Stay tuned for updates in 2023
What’s Your Website Plan for 2023? As a home builder, it's crucial to start the year with a game plan for your website. Think of your website as the MVP of your marketing strategy - without it, you’ll find growing and scaling your business difficult. But what's the point of having a website if it's not living up to its full potential? That's where a solid plan comes in. Set some goals for the year, like increasing website traffic, generating more leads, or improving the user experience. Then create a game plan to achieve those goals. Maybe that means creating fresh content, implementing some SEO tactics, or giving your website a makeover.
As a Cornerstone benefit for Partner, Platinum and Diamond levels they are able to contribute educational content to the newsletter each month. Check out this month's contribution from Contractors Websites Plus
Need some help setting goals for your website? Contact Contractor Websites Plus for a Builders Brand Schematic and we’ll help you create a plan for your website and brand.
Staying up to date with industry trends is also crucial. Just because you're building homes doesn't mean you can't have a cutting-edge website. Consider incorporating virtual or augmented reality to showcase your designs or adding some interactive elements to keep visitors engaged. And let's not forget about budgeting. By identifying your website goals, you'll know exactly how much time and money to invest in your online presence. Don't skimp on your website -it's the face of your business. In short, a plan for your website is non-negotiable for the success of your home building business. Set some goals, stay current, and allocate your resources wisely and your website will be the all-star of your marketing strategy.
info@contractorwebsitesplus.com
Member Contributions
Cornerstone 2021
2023 FABA Board of Directors
President Marc Simes Tricord Homes 1st Vice President Jeh Hicks Jarrell Properties 2nd Vice President Mike King Ray's Siding Secretary Tim Hall Tricord Homes Treasurer Jeremiah Horstick CORELOT Immediate Past President Scott Hine Union Home Mortgage Associate Vice President Teressa Taylor-Griffs TTG and Associates Executive Officer Maria Moore FABA Legal Counsel Charlie Payne Hirschler NAHB State Representative Dan Sandoval Republic Home Builders HBAV State Representative Scott Hine Union Home Mortgage Builder Director Michelle Hall J. Hall Homes Builder Director Allen Harrison Battlefield Homes Builder Director Steve Flanagan Built Right Homes Builder Director Dan Sandoval Republic Homes Associate Director Sara Fila Legacy Engineering Associate Director Rick Furnival Sullivan, Donahoe & Ingalls, PC Associate Director Emily Hall Spotsylvania Career & Tech Center Associate Director Allen Harrison Battelfield Homes Associate Director Greg Schmidt Pest Solutions Life Builder Director Sean Halsey Halsey Homes Life Builder Director Dan Sandoval Republic Home Builders
FABA has been working with our exclusive, private partner, Small Business Growth Partners (SBGP) to help our members reach maximum growth and potential through their one of a kind BPA Process. This has been refined for over 10 years of working exclusively with Builders, Remodelers & HBA Associate Members. As an exclusive FABA member benefit, we are offering you the chance to register for and redeem your 2021 Business Diagnostic & Plan of Actions. An annual BPA is included 100% with your FABA Member Benefits (A $2,200 value).
Learn More Here