The NAHB is working for you: A summary of NAHB activities covered at IBS last week.

Home Builders Association

The NAHB is working for you: A summary of NAHB activities covered at IBS last week.

NAHB / IBS Conference January 2013

National Housing Growth / Projections

  • Housing production (single-family and multi-family) was up over 27% in 2012 vs 2011, beating NAHB’s 2012 projections by about 10%.
  • Housing prices had first overall annual growth since 2006, rising almost 6% in 2012.
  • Household formations are on the rise.  A normal year is 1.2 million.  We were at a low of 500,000 per year during the recession years.  We hit 850,000 in 2012.
  • Remodeling never dropped as far as new home construction and has seen slow but steady growth the last couple of years.  NAHB projects approximately 2% growth in both ’13 and ‘14.
  • Multi-Family starts (mostly apartments) have seen significant growth the past two years (58% in ’11 and 38% in ’12).  NAHB projects slowing but still strong growth in ‘13 of 22%, followed by very moderate growth in ’14 of 6%.
  • Single-family starts fell the most and so have the farthest to climb out.  After bottoming out in ’11, there was a 23% increase in ’12.  NAHB projects a 23% increase in ’13 and a 30% increase in ’14.  Even though this means a doubling of homes built in three years, levels will still be at only 70% of normal amounts (calculated as the early 2000’s before the boom hit).

Building Materials/Pricing

  • Chinese Drywall: For health issues, the product has either been banned or they must retool their plants to meet the new sulfur limit requirement.  NAHB’s effort kept the sulfur content issue from spreading into other building products which could have had a significant impact on construction costs.
  • Overall modest price increases in building materials expected in 2013 with the exceptions of soft lumber materials and gypsum where more significant increases (13%) will be experienced.
  • Looming OSB price increases due to limited demand in previous 5 years and slowness in rebuilding production. Also impacted by the “Sandy effect.” Builders reporting increases in various regions from 7%-30%.
  • Concrete production is at 68% utilization looking to hit 73% in 2013. As this number grown up to 90% we will continue relying on foreign delivery to manage peaks until we top 90% overall utilization so that the previously closed plant can reopen.
  • With the depressed pricing over the past 5 years, buyers are going to experience sticker shock as new houses are built on more expensive lots and with increased material costs. Some areas are seeing in excess of 10% increases.

Green Building

  • Green Building Buyer Preferences (according to a recent NAHB survey)
    • 100% of prospective homebuyers say they are interested in seeing EE features in new construction, but only 14% are willing to pay more for those features.  The 14% that do say they paid more for certain EE features pay an average of only $7,000 more for that home.
    • 71% of buyers prefer buying a home from a builder with an energy certification or advertise themselves as having green building construction knowledge.
  • Federal tax credits for green remodeling and green home building: All were extended into 2013.  HBA and OHBA are working to provide a summary of these credits and how to utilize them within the next couple of weeks.

Codes

  • International Codes Update: NAHB scored a successful outcome on 273 of 336 code change proposals on which they took a stand.  For more info, including a summary of the more significant changes, go to nahb.org/GroupA.
  • ICC working with AIA and NAHB to look at 3-year code cycle and reconsidering a 6 year cycle.
  • ICC will now allow electronic voting, which means significantly more codes officials from around the Country will be determining future code changes.  Local HBAs will need to be even more involved with local officials on areas of concern to our industry.

Air Tightness/Moisture Control

  • Research Center has been monitoring 22 homes for air tightness and moisture control.  The homes were built to the requirements of the 2012 IECC in a variety of climate zones (3 of the homes are in Portland).
  • Type in “Air Tightness” into the search bar on the NAHB website to get the data from the working group.

Other National News

  • NAHB International Builders Show (IBS) will be held in same location and dates as the National Kitchen and Bath Industry Show in 2014
  • NAHB saved builders $7,250 per home through lobbying efforts in 2012 alone.
  • Nationally, all signs of a turning economy are evident with only 1 or 2 state exceptions.  After 4 years of decline, 2012 showed positive housing growth.

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