The key to the mainstreaming of green is to make sure that consumers understand the value of green upgrades – and exactly how cost-effective that sustainable construction can be in the long run, according to four green home building professionals who spoke at a press conference on Wednesday at the National Association of Home Builders’ International Builders’ Show.
Builders, remodelers and product manufacturers are beginning to green their processes and incorporate more energy-, water- and resource-efficient features. They are learning how to reduce waste on the job site to save enough money to pay for these upgrades – and help ensure that the builder makes a profit, said consultant Steve Bertasso, who helps builders achieve these measures.
Green building has truly reached the tipping point because it’s moving out of the custom home market into the realm of high-production homes, he added. "This year is going to be a big change in the production [building] environment," Bertasso predicted. "Consumers are asking questions they didn’t ask two and a half years ago and contractors are making better decisions."
The key to reducing the nation’s energy use is to green existing homes, said Philip Beere, who is remodeling distressed properties near Phoenix’s new rapid transit line. Adding insulation, improving the ventilation and air conditioning systems and replacing turf grass with landscaping more appropriate to the Southwest’s desert climate doesn’t cost much more than a traditional remodel, but "retrofitting these homes to be green is a good solution," he said.
Connecticut home builder Jim Pepitone called himself a "late adopter," but one who has finally seen the green light – and believes the rest of the industry can’t be far behind. Builders need to educate consumers on air sealing, the importance of right-sized heating systems and good insulation, and the advantages of rooms that can serve more than one purpose so the home can be smaller and less expensive. "We need to make sustainable attainable," he said.
Tuesday, January 26, 2010
Crowds More Optimistic at the 2010 International Builders’ Show, Says NAHB
January 22, 2010 - Approximately 55,000 builders, remodelers and other members of the home building industry crowded the aisles of the National Association of Home Builders’ International Builders’ Show, which ended its four-day run Friday at the Las Vegas Convention Center.
The mood? "I’d call it cautious optimism," said Ron Cook of Tamko Building Products in Joplin, Mo., one of more than 1,100 exhibitors at this year’s event. "It’s certainly different than it was last year because we didn’t quite know what we were in for," as the country was still in the midst of the biggest recession since the 1930s.
Members lined up at the Partnership Pavilion, a new NAHB initiative on the show floor designed to match builders with financing sources. The program was launched to help serve an industry still stymied by a lack of available credit for new housing developments – as well as tighter restrictions on home buyer mortgages.
Builders and remodelers also attended educational presentations on design trends, energy retrofitting, marketing, low-income housing tax credits and more than 175 other topics.
"We came here to network," said Clint Wilson of Hybrid Core Homes in Santa Rosa, Calif. The show seemed livelier than last year’s event, he said, although he and his colleagues were disappointed that The New American Home, the much-anticipated demonstration home that usually draws huge crowds, was unavailable for touring this year because of financing issues – a problem plaguing other builders throughout the industry.
A company manufacturing geothermal heating systems saw steady traffic at its booth, according to Steve Smith, managing partner at Enertech Manufacturing, LLC of Greenville, Ill., who said builders are particularly interested in learning more about the tax credits available for installing geothermal and other renewable energy heating and cooling systems.
"It’s been a good, upbeat crowd," Smith said. "I think we all have a more positive attitude for 2010. I’ve already talked to our marketing folks about getting a bigger booth at next year’s show."
The next International Builders’ Show takes place Jan. 12-15 at the Orange County Convention Center in Orlando, Fla.
The mood? "I’d call it cautious optimism," said Ron Cook of Tamko Building Products in Joplin, Mo., one of more than 1,100 exhibitors at this year’s event. "It’s certainly different than it was last year because we didn’t quite know what we were in for," as the country was still in the midst of the biggest recession since the 1930s.
Members lined up at the Partnership Pavilion, a new NAHB initiative on the show floor designed to match builders with financing sources. The program was launched to help serve an industry still stymied by a lack of available credit for new housing developments – as well as tighter restrictions on home buyer mortgages.
Builders and remodelers also attended educational presentations on design trends, energy retrofitting, marketing, low-income housing tax credits and more than 175 other topics.
"We came here to network," said Clint Wilson of Hybrid Core Homes in Santa Rosa, Calif. The show seemed livelier than last year’s event, he said, although he and his colleagues were disappointed that The New American Home, the much-anticipated demonstration home that usually draws huge crowds, was unavailable for touring this year because of financing issues – a problem plaguing other builders throughout the industry.
A company manufacturing geothermal heating systems saw steady traffic at its booth, according to Steve Smith, managing partner at Enertech Manufacturing, LLC of Greenville, Ill., who said builders are particularly interested in learning more about the tax credits available for installing geothermal and other renewable energy heating and cooling systems.
"It’s been a good, upbeat crowd," Smith said. "I think we all have a more positive attitude for 2010. I’ve already talked to our marketing folks about getting a bigger booth at next year’s show."
The next International Builders’ Show takes place Jan. 12-15 at the Orange County Convention Center in Orlando, Fla.
Monday, January 25, 2010
December Existing-Home Sales Down but Prices Rise; 2009 Sales Up
After a rising surge from September through November, existing-home sales fell as expected in December after first-time buyers rushed to complete sales before the original November deadline for the tax credit. However, prices rose from December 2008 and annual sales improved in 2009, according to the National Association of Realtors®.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – fell 16.7 percent to a seasonally adjusted annual rate1 of 5.45 million units in December from 6.54 million in November, but remain 15.0 percent above the 4.74 million-unit level in December 2008.
For all of 2009 there were 5,156,000 existing-home sales, which was 4.9 percent higher than the 4,913,000 transactions recorded in 2008; it was the first annual sales gain since 2005.
Lawrence Yun, NAR chief economist, said there were no surprises in the data. “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” he said. “We’ll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010. However, the job market remains a concern and could dampen the housing recovery – job creation is key to a continued recovery in the second half of the year.”
An NAR practitioner survey shows first-time buyers purchased 43 percent of homes in December, down from 51 percent in November. Repeat buyers rose to 42 percent of transactions in December from 37 percent in November; the remaining sales were to investors.
The national median existing-home price for all housing types was $178,300 in December, which is 1.5 percent higher than December 2008. “The median price rose because of an increased number of mid- to upper-priced homes in the sales mix,” Yun said. It was the first year-over-year gain in median price since August 2007.
Existing-home sales – including single-family, townhomes, condominiums and co-ops – fell 16.7 percent to a seasonally adjusted annual rate1 of 5.45 million units in December from 6.54 million in November, but remain 15.0 percent above the 4.74 million-unit level in December 2008.
For all of 2009 there were 5,156,000 existing-home sales, which was 4.9 percent higher than the 4,913,000 transactions recorded in 2008; it was the first annual sales gain since 2005.
Lawrence Yun, NAR chief economist, said there were no surprises in the data. “It’s significant that home sales remain above year-ago levels, but the market is going through a period of swings driven by the tax credit,” he said. “We’ll likely have another surge in the spring as home buyers take advantage of the extended and expanded tax credit. By early summer the overall market should benefit from more balanced inventory, and sales are on track to rise again in 2010. However, the job market remains a concern and could dampen the housing recovery – job creation is key to a continued recovery in the second half of the year.”
An NAR practitioner survey shows first-time buyers purchased 43 percent of homes in December, down from 51 percent in November. Repeat buyers rose to 42 percent of transactions in December from 37 percent in November; the remaining sales were to investors.
The national median existing-home price for all housing types was $178,300 in December, which is 1.5 percent higher than December 2008. “The median price rose because of an increased number of mid- to upper-priced homes in the sales mix,” Yun said. It was the first year-over-year gain in median price since August 2007.
Saturday, January 23, 2010
Repeat Buyers Need to Act Fast to Capitalize on Expanded Tax Credit
By now it is well documented that today’s affordable housing prices, historically low interest rates and federal home buyer tax credit have combined to create one of the most attractive first-time buyer markets in recent memory. What many Americans might not realize is that a recent expansion of the buyer tax credit has created an equally desirable opportunity for existing homeowners.
This past November, Congress elected to expand the home buyer tax credit to repeat buyers after seeing the success the temporary financial incentive had on the housing market and overall economy. As a result, current homeowners who will have lived in their home for 5 consecutive years out of the last 8 may now be eligible to receive a $6,500 tax credit.
The expanded tax credit offers a great financial opportunity for existing homeowners, particularly those looking to trade up. Not only can you receive a large sum of money from the government, you’ll also likely purchase your next home for less money and at a lower interest rate than you could have in years past or years to come.
To qualify for the tax credit, the repeat buyer must have signed a binding contract by April 30, 2010 and close on the home by June 30, 2010. Tax credit eligibility is subject to income limits, $125,000 for single buyers and $225,000 for couples. In addition, the sale price of the home being purchased can not exceed $800,000.
There is no requirement that existing homeowners must have sold their home to be eligible for the $6,500 tax credit. However, we encourage existing homeowners who want to benefit from this incentive to move quickly, particularly those who prefer to first sell their current home before purchasing a new one.
Typically, it takes three months or longer to sell a home. That’s why it is critical repeat buyers put their home on the market right away. Otherwise they might not leave themselves enough time to both secure a buyer for their current home and find a new home by the April 30 deadline.
This past November, Congress elected to expand the home buyer tax credit to repeat buyers after seeing the success the temporary financial incentive had on the housing market and overall economy. As a result, current homeowners who will have lived in their home for 5 consecutive years out of the last 8 may now be eligible to receive a $6,500 tax credit.
The expanded tax credit offers a great financial opportunity for existing homeowners, particularly those looking to trade up. Not only can you receive a large sum of money from the government, you’ll also likely purchase your next home for less money and at a lower interest rate than you could have in years past or years to come.
To qualify for the tax credit, the repeat buyer must have signed a binding contract by April 30, 2010 and close on the home by June 30, 2010. Tax credit eligibility is subject to income limits, $125,000 for single buyers and $225,000 for couples. In addition, the sale price of the home being purchased can not exceed $800,000.
There is no requirement that existing homeowners must have sold their home to be eligible for the $6,500 tax credit. However, we encourage existing homeowners who want to benefit from this incentive to move quickly, particularly those who prefer to first sell their current home before purchasing a new one.
Typically, it takes three months or longer to sell a home. That’s why it is critical repeat buyers put their home on the market right away. Otherwise they might not leave themselves enough time to both secure a buyer for their current home and find a new home by the April 30 deadline.
Thursday, January 21, 2010
Appraisals an Impediment to More Green Homes, NAHB Says
January 20, 2010 - Kohler, Marvin Windows and Doors and Whirlpool are three manufacturers ready with new lines of green and sustainable products for today’s new homes, company representatives said today at the National Association of Home Builders’ International Builders’ Show in Las Vegas.
But until lenders and appraisers learn to recognize the value of green innovation and the money it can save new home buyers, there is not enough incentive in the marketplace for large-scale implementation, said Bill Nolan, the Florida home building consultant who moderated the first of three press conferences in commemoration of Green Day at the Builders’ Show.
Kohler’s water-saving toilets use an average of 39,000 fewer gallons of water per year for a family of four – a lifetime of drinking water for three people, said Shane Judd, senior marketing manager of water conservation for the company. New products will incorporate rainwater reuse and gray water – using the water draining from the shower stall to fill the washing machine, for example.
Marvin emphasizes long-term sustainability rather than first-time costs and also pays close attention to green practices during the production process, said Brett Boyum, director of marketing. Each year, 8,500 tons of shavings and other wood waste are used to heat the company’s manufacturing plant.
Ed Linder, division director, Whirlpool Corporation, said his company is manufacturing ranges that use 40 percent less energy and appliances that are "smart-grid" ready and is exploring shared-power technologies: for example, using the energy generated from a refrigerator condenser coil to heat the water in the dishwasher.
For innovation to leap forward, it must be cost-effective, and that can’t happen until the additional first-time costs and long-term savings of most green technologies are appreciated by appraisers and bankers in the underwriting process, Nolan said.
"We can’t get lenders to appreciate the value of the net costs, and if we can’t get the values recognized, [manufacturers] can’t justify moving these products forward," he said, noting that NAHB is working to educate appraisers and lenders. "The goal should be long-term energy efficiency."
But until lenders and appraisers learn to recognize the value of green innovation and the money it can save new home buyers, there is not enough incentive in the marketplace for large-scale implementation, said Bill Nolan, the Florida home building consultant who moderated the first of three press conferences in commemoration of Green Day at the Builders’ Show.
Kohler’s water-saving toilets use an average of 39,000 fewer gallons of water per year for a family of four – a lifetime of drinking water for three people, said Shane Judd, senior marketing manager of water conservation for the company. New products will incorporate rainwater reuse and gray water – using the water draining from the shower stall to fill the washing machine, for example.
Marvin emphasizes long-term sustainability rather than first-time costs and also pays close attention to green practices during the production process, said Brett Boyum, director of marketing. Each year, 8,500 tons of shavings and other wood waste are used to heat the company’s manufacturing plant.
Ed Linder, division director, Whirlpool Corporation, said his company is manufacturing ranges that use 40 percent less energy and appliances that are "smart-grid" ready and is exploring shared-power technologies: for example, using the energy generated from a refrigerator condenser coil to heat the water in the dishwasher.
For innovation to leap forward, it must be cost-effective, and that can’t happen until the additional first-time costs and long-term savings of most green technologies are appreciated by appraisers and bankers in the underwriting process, Nolan said.
"We can’t get lenders to appreciate the value of the net costs, and if we can’t get the values recognized, [manufacturers] can’t justify moving these products forward," he said, noting that NAHB is working to educate appraisers and lenders. "The goal should be long-term energy efficiency."
Tuesday, January 19, 2010
New Survey Data Looks at Both Older and Younger 55+ Buyers
January 19, 2010 - A survey of consumers and builders, conducted in 2009 by the National Association of Home Builders (NAHB) and the MetLife Mature Market Institute, has yielded a new round of data revealing the housing preferences of the 55+ consumer. This analysis of data – the third in a series – compared the preferences of the 55-to-64 year old age group to those of the 65+ group.
The data uncovered a strong similarity in housing preferences between the two groups, with a few exceptions. The younger age group showed more interest in technology-heavy features, while the older group expressed a stronger preference for a single-story floor plan or one with a first-floor master bedroom, and a variety of universal design features.
One striking difference, according to John Migliaccio, director of research at MetLife’s Mature Market Institute, related to the desire for home services and community services.
"Very telling, said Migliaccio, "is that the younger group of mature consumers reported enthusiastically that they want services like home maintenance and repair as part of their next home purchase, along with services typically connected to older homeowners, such as housekeeping, onsite health care and transportation," noted Migliaccio.
According to Migliaccio, all of the aforementioned were ranked higher than the desire for organized social activities – a surprise, inasmuch as social activities and amenities have been thought to be valued quite highly by this group. This finding, he said, supports an emerging trend among builders to look for ways to partner with providers of such services to the residents of their active adult/lifestyle communities.
According to Mike McGowan, a 50+ builder from Binghamton, N.Y. and chair of NAHB’s 50+ Housing Council, "Most buyers in this market are looking for an easy-living lifestyle. They would like access to services that will free up their time from maintenance both inside and outside their homes. This data tells builders that the homes we build for older active adults will remain attractive to the consumers who will be entering that market for the foreseeable future."
Paul Emrath, NAHB’s vice president for survey and housing policy research, pointed out that the share of households that will want lower-maintenance housing is large, and growing larger as Baby Boomers age into that segment of the market. He cautioned that the current financial situation has led to sharply decreased construction of communities that serve the mature market. Without a change in the availability of capital for development and construction, there could well be a shortage of such housing when it is most needed.
The data uncovered a strong similarity in housing preferences between the two groups, with a few exceptions. The younger age group showed more interest in technology-heavy features, while the older group expressed a stronger preference for a single-story floor plan or one with a first-floor master bedroom, and a variety of universal design features.
One striking difference, according to John Migliaccio, director of research at MetLife’s Mature Market Institute, related to the desire for home services and community services.
"Very telling, said Migliaccio, "is that the younger group of mature consumers reported enthusiastically that they want services like home maintenance and repair as part of their next home purchase, along with services typically connected to older homeowners, such as housekeeping, onsite health care and transportation," noted Migliaccio.
According to Migliaccio, all of the aforementioned were ranked higher than the desire for organized social activities – a surprise, inasmuch as social activities and amenities have been thought to be valued quite highly by this group. This finding, he said, supports an emerging trend among builders to look for ways to partner with providers of such services to the residents of their active adult/lifestyle communities.
According to Mike McGowan, a 50+ builder from Binghamton, N.Y. and chair of NAHB’s 50+ Housing Council, "Most buyers in this market are looking for an easy-living lifestyle. They would like access to services that will free up their time from maintenance both inside and outside their homes. This data tells builders that the homes we build for older active adults will remain attractive to the consumers who will be entering that market for the foreseeable future."
Paul Emrath, NAHB’s vice president for survey and housing policy research, pointed out that the share of households that will want lower-maintenance housing is large, and growing larger as Baby Boomers age into that segment of the market. He cautioned that the current financial situation has led to sharply decreased construction of communities that serve the mature market. Without a change in the availability of capital for development and construction, there could well be a shortage of such housing when it is most needed.
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