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New Home Sales at Highest Pace Since September 2006
In another indicator that housing continues to lead the economy forward, sales of newly built, single-family homes in August topped the 1 million mark and reached their highest pace since September 2006.
Sales increased 4.8% to a seasonally adjusted annual rate of 1.01 million units, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
The August rate is 43.2% higher than the August 2019 pace.
“Surging sales are consistent with record builder confidence levels stemming from higher buyer traffic, historically low interest rates and a shift in demand for lower density markets,” said NAHB Chairman Chuck Fowke. “However, higher lumber costs and limited building material availability in some markets signify we could see higher prices down the road.”
“New home sales are now 15% higher on a year-to-date basis, with gains in all regions,” said NAHB Chief Economist Robert Dietz. “But with inventory at just a 3.3 months’ supply, more construction is needed. The challenge will be whether materials and labor are available.”
That 3.3 month's supply means just 282,000 new single-family homes are for sale, 40% lower than August 2019. The current months’ supply is the lowest in the history of the data series, which goes back to 1963. Of the inventory total, just 54,000 are completed and ready to occupy.
Apartment Absorption Rate Falls to 45%
The absorption rate of unfurnished, unsubsidized apartments (the share rented out in the first three months following completion) fell to 45% in the first quarter of 2020 (from 53% in the first quarter of 2019), according to data from the U.S. Census Bureau’s Survey of Market Absorption. This is the lowest absorption rate for the first quarter since 1986. The decline in the absorption rate is related to the emergence of COVID-19 in the US.
HUD Secretary Carson Speaks with NAHB
HUD Secretary Ben Carson on Sept. 24 participated in an exclusive webinar that more than 1,000 members and invited guests registered to attend. He discussed the need to address the lumber crisis as well as HUD’s actions to address housing needs in response to COVID-19.
Carson told the NAHB members that lumber prices are “a big roadblock” and that he would seek to “elevate” this issue by engaging with other top administration officials.
Is Now Open
Registration is open for the 2021 NAHB International Builders’ Show® (IBS), the premier event in the resident- ial construction industry. The in-person show will follow all safety protocols set forth by the CDC and federal, state and local government agencies.
IBS will move back to the Orange County Convention Center in Orlando, Feb. 9-11, where it will again co-locate with the National Kitchen & Bath Association’s Kitchen & Bath Industry Show® (KBIS).
Amek Homes Retires
Andrew Mekdeci, President of Amek Homes and HBCA member, is planning his retirement after over 40 years in the building industry. “Andrew and his local staff were always responsive in updating their membership to the HBCA. Not only for the HBCA, Amek Homes was truly a cooperative and amicable co-builder in many local Viera Communities, and they were a joy working together with all of us in our competitive business.” said Paul Joyal, Amek’s Sponsor. The Home Builders & Contractors Association of Brevard sends the best wishes and many enjoyable years to Mekdeci in his retirement.
ICC Board Agrees with NAHB on Appeal
The ICC Board of Directors on Sept. 23 agreed with NAHB’s appeal related to a proposed change to the International Energy Conservation Code (IECC) that dealt with the efficiency of water heaters. NAHB and others argued, and ICC agreed, that the changes would have preempted federal law or would have exposed adopting jurisdictions to potential litigation related to the proposed requirements.
The ICC Board decided to reject RE126-19 (and RE107-19) on the basis that “potentially preempted provisions in the I-Codes are inconsistent with the spirit, intent and mission of the Code Council.”
The White House recently joined NAHB in opposing House energy bill H.R. 4447 due in part to problematic language regarding building codes that would harm housing affordability.
NAHB has come out in strong opposition to the legislation because it would needlessly raise home construction costs while doing little to boost energy efficiency in the housing sector.
NAHB ran a strong grassroots campaign asking members to reach out to their
congressional members and urge them to oppose the legislation.
Over the past two years, NAHB has also met with the White House to discuss concerns about the building code language. NAHB's leadership was pleased to see that the administration shares the association's concerns.
The full Statement of Administration Policy can be viewed on the White House's website.
Video Highlights 2020 NGBS
With so many green rating systems available, understanding how each one compares to the others is imperative for making a choice that works best for your project, climate zone and market. The recent release of the 2020 National Green Building Standard™ (NGBS) provides a great opportunity to conduct a side-by side comparison, starting with energy performance — an easy element to measure.
Buyers also can relate to energy perform- ance without difficulty; they desire energy efficiency, whether it’s the numbers they see on their electric bill or the familiar ENERGY STAR label.
NAHB has produced a two-minute video highlighting the strengths of the 2020 NGBS that members can share on social media.
EPA Finalizes Reg Guidance
The EPA has finalized a rulemaking that establishes regulatory standards for all EPA regulatory guidance documents. EPA’s final rule, intended to increase transpar- ency and access, has four key elements:
Establishes a regulatory definition for the “guidance documents” and “significant guidance documents” that are subject to the rule’s requirements.
Responds to President Trump’s directive under Executive Order 13891, “Promoting the Rule of Law Through Improved Agency Guidance Documents.”
Requires “significant regulatory guidance documents” to be subject to public com- ment before being finalized by the Agency.
Creates a process by which anyone can petition the agency to modify or withdraw any existing regulatory guidance document.
White House Joins NAHB in Opposing House Energy Bill