BISMARCK-MANDAN HOME BUILDERS ASSOCIATION JUNE 2020 || WWW.BMHBA.COM
BUILDING Building Buzz is a publication of the Bismarck-Mandan Home Builders Association.
PROFESSIONALS BUILDING OUR COMMUNITY THROUGH
PROMOTION OF
Bismarck-Mandan Home Builders Association 2600 Gateway Ave, Ste 1 Bismarck, ND 58503 Phone: 701.222.2400 Fax: 701.250.9730
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SINCE 1958.
PRESIDENT Sattler Homes 701-255-7628 jeff@bismarckbuilder.com VICE PRESIDENT Aspire Homes 701-426-8583 greg@daretoaspire.com 2ND VICE PRESIDENT Triton Homes 701-223-3030 jamie.schmidt@investcore.com
Northern Plains Plumbing, Heating & Air 701-222-2155 greg@northernplains.net Townsquare Media 701-250-6602 bill.schmid@townsquaremedia.com
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Stoneshire Builders 701-471-6935 brian@stoneshirebuilders.com Hallmark Homes 701-471-7634 hallmarkhomes@outlook.com
TREASURER Boulder Homes 701-400-5554 boulderhomesnd@gmail.com
Dakota OutdoorScapes 701-214-1255 mckenzie@ndscapes.com
Great Plains Rehab 701-400-0676 rtank@primecare.org
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PAGE 15
Joe Vetter Construction 701-258-9394 joevetterjvc@gmail.com
PAGE 10 Apex Builders 701-527-7899 amy@apexbuildersnd.com
PAGE 11
Dawn Watson dawn@bmhba.com Office: 701-222-2400 Cell: 701-390-5049
Simone Marchus simone@bmhba.com Office: 701-222-2400 Cell: 701-527-7230
Elysha Head
Representing the diversity of the building industry, the BMHBA consists of building specialists from every section of the construction field and associated industries. Your membership strengthens our voice in Bismarck-Mandan construction sector as well as at a state and national level. Please renew your membership by June 30, 2020.
Shaun Ahlgren
Doug Keller
Heidi Rue
Nick Roemmich
Casey Olheiser
Landon Niemiller
Dan Domagala
Brian Frank
Bill Schmid
Arlan Scholl
Jay Crowley
Shirley Johs
Sommer Jacob
2020 The building season is now in full swing and our building permits continue to climb. The Bismarck-Mandan Home Builders Association is preparing for the 33rd Annual Golf Tournament in conjunction with the Bismarck Mandan Board of REALTORS®. I will be selling NDAB PAC pins at the tournament. The funds from the pins supports our state and local candidates. If I see you there, I would be happy to sell you a pin. I would like to see this be the most well attended golf tournament in history. If you’re interested in sponsorship or golfing, feel free to call the BMHBA office. In this issue you’ll find an engaging interview with Vicki Moran of Hallmark Homes. Vicki is in the process of starting a Professional Women in Building Council for Bismarck and Mandan. I encourage you to read the interview and consider joining the council as well. I would like to remind all of you that your membership with the BMHBA comes with benefits. Each year NAHB partners with reputable companies to bring you serious savings that can benefit both your professional and personal life. Whether you’re looking for a new vehicle or
Regards,
2020 PRESIDENT :: BMHBA
staying in a hotel—NAHB has a discount for you. View the included graphic to see all the companies that NAHB is partnered with. If you have any questions regarding obtaining these discounts, don’t hesitate to contact the office. I hope all of you have a fantastic June, and I look forward to seeing you at the PAC Golf Tournament.
SINGLE FAMILY MONTH
BISMARCK PERMITS YEAR
BISMARCK ETA
MANDAN PERMITS
LINCOLN PERMITS
BURLEIGH/MORTON
‘18
‘19 ‘20
‘15 ‘16 ‘17
‘18
‘19 ‘20
‘15 ‘16 ‘17 ‘18
‘19
‘20
‘15
‘16
‘17
‘18
‘19
‘20
‘15 ‘16
‘17
‘18
‘19 ‘20
0
9
1
0
10
2
0
0
0
0
1
0
0
2
0
0
0
2
0
0
2
0
0
0
0
0
2
FEBRUARY
3
4
5
2
0
10
0
0
0
1
1
2
6
5
0
0
0
0
0
3
0
2
1
1
0
0
0
3
MARCH
21 22 14
2
9
32
2
2
1
4
11
6
4
8
2
8
0
3
0
0
0
1
9
9
4
2
4
12
APRIL
52 29 40
27
26 23
4
3
6
8
14 12
8
16
11
5
18
2
4
0
6
1
14
5
11
11 14
MAY
31 46 29
16
28
JUNE
31 43 48
24
18
JULY
40 16 60
22
17
AUGUST
20 48 16
27
19
SEPTEMBER
28 44 26
22
23
OCTOBER
54 14 22
15
36
NOVEMBER
16 11
9
11
14
DECEMBER
1
0
1
1
0
Data not collected for the ETA in 2015 and 2016.
‘15 ‘16 ‘17
JANUARY
5
6
4
26 13 11 15
11
17
2
5
5
0
14 16
7
20 10
2
2
21 20 13 13
4
1
6
3
1
1
8
11
4
4
6
3
3
2
9
13
6
11
12
0
5
1
5
1
13
9
4
3
11
6
1
7
17
7
13 20
10
8
2
9
4
5
8
9
6
8
5
8
3
10
16 14 26 11
10
3
3
4
5
2
9
9
9
6
5
4
7
3
9
29 20
9
9
17
10
7
5
3
4
7
3
7
1
3
0
1
7
7
7
6
2
2
5
0
0
0
3
4
1
0
2
0
0
0
0
0
0
0
0
1
0
4
0
0
0
0
2
0
0
45
27
36
13
132 123 114 116
71
13
67
40
37
28
20
4
83
80
51
61
60 20
27
36
13
132 123 114 116
71
13
67
40
37
28
20
4
83
80
51
61
60
297 286 270 169 201 67
YTD TOTAL
297 286 270 169 201 67
YTD Total
-4% -6% -37% 19%
-40% 33%
-7% -7% 2% -39%
-40% -8% -24% -29%
-4% -36% 20% -2%
Total
-4% -6% -37% 19%
-40% 33%
-7% -7% 2% -39%
-40% -8% -24% -29%
-4% -36% 20% -2%
0
4
10
TOTAL
0
1
45
BISMARCK SINGLE FAMILY DWELLING DIVERSITY HOMES 2819 DEL RIO DR E HOMES 1024 MUSTANG DR HALLMARK HOMES 1316 CREST RD JE PROPERTIES 4612 KITES LN JE PROPERTIES 624 FLINT DR K&L HOMES 1206 COMMUNITY LOOP K&L HOMES 1025 LIMITED LN K&L HOMES 1032 RESERVE LN PARAMOUNT BUILDERS 801 W GLENWOOD DR PARAMOUNT BUILDERS 803 W GLENWOOD DR PRAIRIE AIRE HOMES 3919 HERD PL RUDNICK CONSTRUCTION 4060 DOWNING ST SATTLER HOMES 2710 PEACH TREE DR
BISMARCK ETA BIG RIVER BUILDERS BOULDER HOMES GRENDAHL DESIGN CO LENGEDARY HOMES
130 ASHLEE AVE 5207 BEAVER CREEK PL 416 CRESTRIDGE LN 3724 HIGH PLAINS RD
MANDAN SINGLE FAMILY DWELLING JE HOMES 3915 AMARI LP NW JE HOMES 3910 AMARI LP NW VERITY HOMES 302 COBBLESTONE LP SW VERITY HOMES 3817 AMITY CIRCLE SE
20
Even in a state with the second-lowest unemployment rate in the nation, hunger exists. In Bismarck-Mandan alone, over 4,000 students receive help through the Free and Reduced Lunch Program. However, the MSA United Way learned that this program was still leaving a gap for the poorest children in our community who were coming to school on Monday dizzy and distracted, having not eaten over the weekend. Unfortunately, the Coronavirus poses a new challenge for United Way. Children aren’t simply hungry on the weekends anymore—they’re hungry every day of the week and aren’t able to look forward to school as place of comfort and respite.
The Bismarck-Mandan Home Builders Association was founded in 1958. Over the years, the association has fostered loyal relationships with members and businesses alike. We would like to take a moment to recognize and celebrate our longest standing members. The following companies have supported the association in countless ways. We’re truly lucky to call them our members. Century 21 Morrison Realty
January 1, 1975
Gate City Bank
April 1, 1975
Knife River-North Central
April 1, 1975
In an effort to alleviate this problem, staff and the Board of Directors at the Bismarck-Mandan Home Builders Association are sponsoring a weekend of food donations, in conjunction with United Way. The sponsorship will directly benefit the local United Way Backpack Program.
Montana Dakota Utilities Co
April 1, 1975
SPS Companies, Inc.
April 1, 1975
North Dakota Guaranty & Title Co
February 1, 1976
Advanced Truss Fabricators
March 1, 1976
The United Way Backpack Program provides food for students in elementary, middle and high schools across Bismarck-Mandan. MSA United Way recruits and coordinates local businesses that sponsor and pack bags containing food, then deliver the backpacks to schools, where counselors provide them to needy students.
Acme Tools
February 1, 1978
Keller Hearth ‘n Home Products
June 1, 1978
Magi-Touch Carpet One
February 1, 1979
Leingang Home Center
June 1, 1979
Carpet World
July 1, 1981
If you would like more information on MSA United Way, please visit MSAUnitedWay.org.
The Federal Housing Finance Agency (FHFA) today Mae and Freddie Mac would have held a combined $243 re-proposed a 2018 plan to establish a new regulatory billion in capital, the FHFA said. capital framework for Fannie Mae and Freddie Mac. The Fannie Mae and Freddie Mac were placed into proposed rule is a critical step toward FHFA’s goal to release conservatorship by the U.S. Treasury in September 2008. the two government-sponsored enterprises from Comments will be due 60 days after the notice is conservatorship. published in the Federal Register. If the new proposal had been in effect in 2019, Fannie
Findings from a third survey of businesses in the Bismarck-Mandan area about impacts and needs related to COVID-19 show improvement in the level of operations, many steps being taken to protect employees and customers, plus opportunities for hiring. Just over two-thirds responding May 14-20 were open regular hours of operation, 25% had reduced hours and 6% were still closed. This is an improvement over an April business survey when only half of respondents were open regular hours, 31% had reduced hours and 17% were closed. A little over half of respondents are now close to their normal operating level, up from a third in April. In terms of modifications to how they serve customers, 37% report limited in-person public interaction and many still have employees working remotely. Nearly a third of respondents were forced to close their businesses or restrict services under the state executive order. Since the May 1 restart, most say they’ve re-opened, but operations are below normal. Eleven respondents have chosen not to re-open because of concerns for safety of owners, employees and customers. Almost all respondents say their business is taking at least some additional protective measures to keep employees and customers safe. Most common is more frequently cleaning at 82% followed by hand sanitizing stations, 80%; encouraging social distancing through various means, 70%; face coverings for employees, 61%; messaging and signage about guidelines, 61%; deep cleaning, 60%; barriers at check-out or customer service counters, 25%; face coverings for customers, 16%. Only 3% said no changes were needed for their business model. Availability of personal protection equipment and sanitizing products is an issue for about a third of respondents. On the topic of workforce, 89% of respondents have been able to retain or rehire enough employees to meet current business needs, but 11% have not. Some cite current unemployment benefits as an obstacle. On the flipside, another 11% don’t have enough work for their employees and 10% still have employees on furlough or laid off. With optimism for the future, 30% of respondents are currently seeking to hire employees. Asked about business prospects for the remainder of 2020, 58% expect a sales decrease, 17% expect no change and 22% expect an increase.
Since COVID-19 became a widespread concern in midMarch, 73% of respondents report weekly revenue decreases compared to results of an April survey at 86%. Normal is the story for 19%, up from 11% of respondents in April, and 8% are experiencing an increase, up from 3% of respondents last month. Asked about sustainability, 77% say they can withstand more than five months disruption or that they’re not concerned about permanent closure, but 18% say they can only make 3-5 more months, 4% 1-2 months, and 1% less than a month. Just under half of May’s survey respondents have contacted their bank about a loan payment reduction, deferral or other assistance during the pandemic, while 27% indicated it is unnecessary and 26% said no. Some expressed an aversion to taking on more debt, even if at 0% interest. The Small Business Administration (SBA) Payroll Protection Program is by far the most popular assistance program among respondents with 61%, or 87 businesses, indicating they applied for it or received funding. Next in order is the SBA Economic Injury Disaster Loan with 22%, or 31 businesses, indicating application or receipt of funds. A few others applied for new Bank of North Dakota loan programs or received loan deferments or interest-only payment provisions from their local lender. The May survey received 157 responses with selfidentification from 74 located in Bismarck and 50 in Mandan, down from 235 total respondents in April and 436 in March. The survey summary is available on the websites of most survey partners: • • • • • • • • •
Bismarck Downtowners Bismarck Mandan Board of Realtors Bismarck Mandan Chamber EDC Bismarck Mandan Convention and Visitors Bureau Bismarck-Mandan Home Builders Association CTB & N.D. Women’s Business Center at the IDEA Center City of Bismarck City of Mandan Business Development and Communications Department Mandan Progress Organization
The City of Mandan issued a noxious weed control notice this month. All property owners, residents, and caretakers of property within the city limits of Mandan must adhere to the notice. All noxious weeds and/or overgrown vegetation must be cut or sprayed by June 1, July 1, August 1, September, October 1 and must be maintained under the 6 inch maximum height. Any failure to comply with this notification will result in the property being cut and/or sprayed by the city with the cost being added to the property’s special assessments. If you are planning to spray your property instead of cutting it, you must notify the weed officer at (701) 6673288 or your property will be cut with the cost being added to your special assessments.
On April 15, MDU Resources Group announced that it is donating $500,000 to a variety of organizations to support coronavirus relief efforts, including $41,500 to charities in North Dakota. The donation comes from the MDU Resources Foundation, which is funded by stockholder monies, and is in addition to the $2.2 million the MDU Resources Foundation already has committed to charitable organizations this year. MDU Resources Group companies in North Dakota include Knife River Corporation, MDU Construction Services Group Inc., Montana-Dakota Utilities Co. and WBI Energy Inc. Organizations receiving coronavirus relief funds from MDU Resources in North Dakota include: • • • • • • • • • • • • • • • •
Curious about upcoming projects in your community? Bismarck publishes an annual map for planned road and utility work. The interactive map lets you zoom in on your neighborhood and get details on what's going on. It highlights water main and sewer repair, roadwork, and new development. City staff see it as a way to keep taxpayers informed. “If some homeowners water supply to their house might be out of service and they want to know why. Certainly if they look in the vicinity on a construction map and realize that there's a project that we're working on maybe a block away that might have turned off a valve or something like that. That helps the public and helps our staff to understand where those problems are caused from,” said Gabe Schell, city engineer. To find the map go to bismarcknd.gov/streets and click the link.
Adams County Food Pantry Barnes County Food Pantry Bismarck Meals on Wheels Bowman Community Cupboard Carson Food Pantry Cavalier Emergency Food Pantry Charles Hall Youth Services in Bismarck Community Action Program in Bismarck Country Community Cupboard in Elgin Divide County Food Pantry Dunn County Food Pantry Ellendale Community Food Pantry Emmons County Food Pantry Glen Ullin Community Food Pantry Great Plains Food Bank Kenmare Food Pantry
• • • • • • • • • • • • • • • • •
Kidder County Food Pantry Mandan Golden Age Club Mandan Public Schools McKenzie County Food Pantry Ministry on the Margins in Bismarck Mott Food Pantry Mountrail Community Food Pantry Salvation Army in Williston Sargent County Food Pantry Soup Café in Bismarck The Banquet in Bismarck Tioga Community Food Pantry Underwood Community Cupboard Wishek Food Pantry Women’s Action and Resource Center in Beulah Zion Church Food Pantry in Berthold Williston Salvation Army Food Pantry
MDU Resources President and CEO David L. Goodin said the health and safety of MDU Resources’ employees, customers and the public is always the company’s top priority, and the donations are intended to help communities regain their good health. “We know it will take some time for our country to recover from this adversity, and we want to do our part to help,” Goodin said. “In addition to monetary support from our corporation, our employees are dedicated to ensuring we continue to serve our customers with the electricity, natural gas and energy and transportation infrastructure that are essential for daily life.” In addition to the $500,000 donation, the MDU Resources Foundation is accelerating 2020 grant payments that were previously identified for organizations such as food banks, shelters and elderly support. “Our employees are proud of the essential services they provide and of our company’s support of our communities and the people who live in them,” Goodin said.
SAM GIETZEN OF GIETZEN CONSTRUCTION :: SAM WAS BORN AND RAISED IN BISMARCK-MANDAN AND REMAINS COMMITTED TO THE COMMUNITY. AFTER GRADUATING FROM MANDAN HIGH SCHOOL, HE RECEIVED A DEGREE IN ARCHITECTURAL DRAFTING AND ESTIMATING FROM NORTH DAKOTA STATE COLLEGE OF SCIENCE. SAM HAS BEEN DOING HOME REMODELS, REPAIRS, AND RENOVATIONS FOR MORE THAN 15 YEARS. HIS KNOWLEDGE BASE AND UNDERSTANDING ARE UNPARALLELED BY MOST CONTRACTORS IN THE AREA. SAM HAS ALWAYS MAINTAINED STRONG FAMILY VALUES, INTEGRITY, AND RESPONSIBILITY. SAM’S GREW UP LEARNING THIS FROM HIS FATHER, WHO OWNED A BUSINESS FOR 35 YEARS. SAM AIMS TO SHOW INTEGRITY IN ALL ASPECTS OF WORKING WITH HIS CUSTOMERS. What is an interesting fact about your business that most people don’t know? I am a first-generation carpenter. My parents grew up farming in Western North Dakota and my father is an auto mechanic by trade. I strongly disliked working on vehicles at the family business and have always been drawn to carpentry. I have worked with and been influenced by some very skilled carpenters through the years. Do you have any advice for someone just entering this industry? I could have a few articles of advice for someone new to the industry and/or business ownership. 1) Don’t be afraid to work. Owning any business, but particularly a construction business, requires lots of hands on work. Do not shy away from it – get in there, get your hands dirty. 2) Treat employees and subcontractors how you would want to be treated. With respect, dignity, and understanding. Chances are your subcontractors are also working for other builders. Know that. Work with them. 3) Stay on top of your books. Pay quarterly taxes (if it makes sense for your company). Designate proper time for office and managerial duties. Know where you are financially. Be honest. 4) Do not neglect your family. Keep your priorities in check. There is a balance. Find it and pay close attention to it. 5) Lastly, have fun. Business ownership is a joy – it should feel that way. What is a typical day like for you? At Gietzen Construction, a typical day for me, personally is: Up early and at the office (with coffee). Get crews rolling out of shop by or before 8 am. My schedule is littered with onsite consultations and current project progress meetings and site visits, ordering materials, etc... Depending on the bid-load, I spend a good amount of time at my desk managing, designing, and bidding projects, as well as, staying on top of company file and records management. I do not want to miss supper with my family. I go in early so that I don’t have to work late. Having a young family, I do not want to miss those precious moments at home with them. If I weren’t a carpenter, I’d be a… I would probably be an architect. But going to college for more than 2 years was not appealing to me.
@gietzenconstruction
@gietzenconstruction
www.gietzenconstruction.com
June is an election month and while it doesn’t get as much attention as November elections do, primaries are also extremely important. Plan to vote! Do your homework on candidates, talk to your local associations, get involved and be educated. Most importantly, take the time to vote! Your voice matters and it really takes a couple of minutes to cast a vote that is important helping to shape our future and can help ensure that those who support the home building industry are the ones who get elected into office. Voting is a right we all have; vote on June 9! Another way to be involved in advocacy and having your voice heard is to become active with NDAB-PAC. NDAB-PAC is the North Dakota Association of Builders’ Political Action Committee. It is a non-partisan political action NDAB CEO · KIM SCHNEIDER 2020 NDAB PRESIDENT committee which provides support for candidates who are friends of the NATE APPLEGREN building industry. NDAB-PAC recognizes there is strength in numbers. People who show they care and are concerned about the future of the building industry make contributions to NDAB-PAC because they believe that cooperation equals strength. You alone can’t influence the Legislature or Congress on issues that can devastate your business. NDAB-PAC is your front line of defense. It monitors legislative issues and works to protect and promote the building industry. By pooling contributions from NDAB members, NDAB-PAC can help elect legislators who understand and support the issues and concerns of builders and associate members. NDAB-PAC is then able to contribute funds to candidates based on recommendations from our members and PAC Trustees for local and statewide candidates. BUILD-PAC, the national PAC for National Association of Home Builder’s is then able to provide political contributions to our national delegates as requested by our BUILD-PAC Trustee, Vance Vetter of Bismarck-Mandan HBA and BUILD-PAC Alternate Trustee, Don Dabbert Jr of the Fargo-Moorhead HBA. Please let your local association or our office know if you have any questions. Coming soon will be NDAB-PAC hammer and flag pins. The sale of these pins will help support our NDAB-PAC. June usually brings us together with fellow members from across the nation in our Nation’s Capital. Unfortunately, this year, the Spring National Association of Home Builders (NAHB) Spring Board of Directors meeting was changed to be a virtual meeting. Holding a virtual meeting still provides us all with the opportunity to conduct business, to attend national meetings, collaborate with our peers and hold discussions with NAHB staff. Keeping our members safe, yet well informed is important during these times. We appreciate all of the efforts by the national staff. NDAB Board of Directors and NDAB-PAC Trustees also decided to change their June meeting and summer social plans. While we were to gather in Fargo, we will be holding our board meeting virtually on Thursday, June 4. If interested in learning more about what happens at our state or national meetings, please talk to your local association or any active board members to learn more. Peer mentoring is always a great way to get more involved and we always welcome guests to join us. Your insight, experience and boots on the ground are what we value in what you bring to our meetings along with building friendships. We want to wish our very own, NDAB President Nate Applegren a very Happy Birthday on June 4! Stay informed, stay physically distant, stay healthy: Nate Applegren, NDAB President and Kim Schneider, NDAB Chief Executive Officer
When the COVID-19 pandemic began in the United States, few could have imagined the longterm, life-changing impact it would have on our dayto-day routines. As the effects continue, the negative impact on mental health from social isolation, job uncertainty and concerns about the coronavirus itself is growing, and never has there been more of a need for serious self-care and peer support. In a free webinar from NAHB, Headstrong: Mental, Emotional & Behavior Wellness in the Midst of a Pandemic, Patrick Gauthier and Rich Landis of Advocates for Human Potential (AHP) discuss the everyday challenges presented by the pandemic and share steps and concrete strategies we can take to cope with stress and anxiety caused by the pandemic. The webinar is previously recorded and can be viewed at your convenience. It is important for home builders, and all workers, to address their mental health in uncertain times like these. May was Mental Health Awareness Month, providing the perfect opportunity to address any issues and anxieties around the ongoing pandemic and economic shutdown. The Centers for Disease Control and Prevention also recognizes the need to address the mental health toll of COVID-19 and has created resources to help deal with pandemic-related stress and anxiety. In conjunction with the webinar, AHP has developed a new guide about staying connected during this isolated period. The Wellness Guide to Overcoming Isolation During COVID-19: Being Connected, Staying Connected, and Choosing Connection is free to all. To view these resources, visit NAHB.org.
While spending significantly more time at home during the last few months, many home owners have likely noticed some inefficiencies with their home’s energy consumption, plumbing system, air quality and more. Home improvements that enhance comfort, energy efficiency and health will surely become more prevalent in remodeling conversations moving forward. Using green-building techniques can better position remodelers to meet that growing demand. The new ICC 700-2020 National Green Building Standard® (NGBS) provides a roadmap to guide the design and construction of high-performance projects, while the certification process provides a third-party verification to validate the work. The 2020 edition of the NGBS builds on more than a decade of green-building experience and offers several new opportunities and increased flexibility for remodelers. The remodeling chapter (Section 11) has been substantially revised and includes:
•
•
• • • •
More flexible renovation requirements: • Generally, these are the same mandatory practices as new construction, but are only required when relevant. • Unaltered portions of the building are exempt from mandatory practices (unless safety or moisture issues are present). A choice of prescriptive or performance compliance paths for energy and water efficiency: • Paths can be the same or different. • For performance paths, the certification level is based on the percent of reduction in energy or water consumption. Attributes of the building that complied before the remodel, and remain in compliance, are eligible to earn points. An optional three-year look back for remodel activities, provided there is documentation for baseline conditions. An option to utilize a phased approach for multifamily remodeling projects Remodeling projects that convert existing buildings to multifamily properties
Seeing green is 20/20 with the new NGBS. It provides remodelers the flexibility they need to renovate and remodel existing building stock to integrate cost-effective sustainability and highperformance strategies and features into their projects at a level most appropriate for their business model, customer base and local housing markets. Download the NGBS for free at nahb.org/ngbs.
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Housing data was in focus this week, with April readings showing market impacts from government-imposed shutdowns intended to facilitate virus mitigation. While those impacts were strongly negative, the realized declines have been relatively smaller in the housing industry than initially forecasted.
construction will depend on the pace of job restoration as economies reopen.
The NAHB Multifamily Production Index (MPI) showed a 22-point drop in the first quarter, falling to a negative reading of 27. This reading of the MPI is consistent with declines for the multifamily forecast as job losses mount. Indeed, multifamily starts declined 40.5% in April to a 241,000 annualized rate. This represents a 62% decline from the peak January rate. A recovery for apartment
When unemployment is held to periods of less than six months, consumers are able to adapt without major changes in decisions regarding large purchase plans. The April job report found that 18 million individuals believed it was possible for them to regain their prior employment, which is an encouraging sign for a rebound.
Existing home sales, as estimated by the National Association of Realtors, experienced the largest decline in 10 years. Despite being down 18% in April relative to March, current inventory remains tight, with only a 4.1-months’ Moreover, the notable resiliency of housing demand supply. Pricing actually accelerated to a 7% year-over-year amid historic job losses is an indicator of the potential of the gain, which is another indicator of the potential gains for housing sector to help lead the economy in an eventual housing. rebound. While challenges still lie ahead — particularly the Another positive indicator comes from the Mortgage possibility for a large, second outbreak of the virus in the fall Bankers Association mortgage data, which finds that — the designation of home construction as an essential mortgage applications for home purchases have increased industry combined with the reopening of major portions of for five straight weeks and are down only 1% compared to a the U.S. economy sets the stage for improving data for the year ago. Given this demand environment, thus far, housing sector in the months ahead. relatively few builders are cutting prices to generate sales. In The benchmark measure of builder confidence, the April HMI, only 22% of builders reported using price the NAHB/Wells Fargo Housing Market Index (HMI), incentives, and among those, the typical price cut was only rebounded in May, increasing seven points to a still negative 5%. In contrast, 40% of builders reduced prices at the end of reading of 37. The gain in May nonetheless pointed to 2018, during the housing soft patch of 2018-2019. improvements for housing starts ahead, with April being a Despite these relatively encouraging housing data points, low point for the current recession. macro data continue to show historic challenges. Another Single-family starts were down 25% in April from March, 2.4 million jobless claims were filed this week, bringing the declining to an annualized rate of 650,000. The April level two-month total to almost 39 million total job losses. The marks the slowest annualized pace since 2015 and is off data implies an unemployment rate of more than 17%, with 37% since the strong rate recorded in February. The our forecast suggesting a rate closer to 20% for the second strength of the early 2020 data means that even with recent quarter. Such job losses will have ripple effects on purchase declines, single-family starts remain 1% higher for the first data for consumers, although it is worth noting that prior four months of the year compared to the first four month of economic research finds that duration matters for job 2019. losses.
In a victory for home builders and housing affordability, Oklahoma Governor Kevin Stitt (R) has signed SB 1713 into law. The legislation will limit cities and counties from regulating purely aesthetic building design that would needlessly raise the cost of housing. The Oklahoma Home Builders Association (OkHBA), along with the Oklahoma Realtors Association, the Affordable Housing Coalition and other trade groups and consumers, lobbied aggressively for this legislative remedy after some Oklahoma towns proposed residential design changes that would prohibit exterior finishes such as vinyl, wood and aluminum siding that are otherwise permitted under all editions of the International Residential Code. Other proposed changes such as roof pitch or front facing garages would collectively increase building costs and price entry-level buyers out of the market. With Oklahoma and the rest of the nation already facing a housing affordability crisis, the OkHBA argued that the proposed standards are a form of exclusionary zoning that would increase housing costs and price out certain groups of prospective home owners from the housing market.
process, especially the design and aesthetics of their new home. If they can’t have the things that make them happy, then it’s just a house without the love of a home.” Oklahoma home builder Curtis McCarty, president of the OkHBA, noted the legislation is particularly important for young families seeking to get a toe hold on the homeownership ladder. “The issue of affordability really affects everyone, but especially first-time home buyers,” he said. “If we don’t find ways to keep housing affordable, we will eliminate a group of people that would like to be home buyers but end up renting.” He added that passage of the bill “was a huge win for not only housing but the OkHBA. We came together as a group from all over the state and worked together for the betterment of our industry.” “Cities and states might not be able to prevent the high product costs and rising interest rates that affect the housing industry nationwide, but fortunately they can prevent more costs that come from adding unnecessary design regulations to homes,” said builder M.J. Farzaneh with Home Creations.
“The ability of persons from all economic segments to own a home is one of many reasons America is who we are,” For more information, contact Karl Eckhart at 800-368said Oklahoma State Senator Kim David, the lead sponsor of the bill. “The commitment from home builders to defend 5242 x8319. property rights and continue to protect all Americans is why we were so pleased to work alongside OkHBA and pass legislation that will continue to uphold these ideas.” Oklahoma State Rep. Ryan Martinez also noted the importance of being able to design a home of your choosing. “Building a new home is a special time in a family’s life,” he said. “That means that they would like to be involved in all parts of the building
Home builders associations are teaming with members and their local school systems to keep construction career exploration available to students during the COVID-19 pandemic. The Home Builders Association of Greater Des Moines and the Fredericksburg Area Builders Association (FABA) shared how they continue to adapt in order to reach the industry’s next generation of workers. Iowa Skilled TradesPrior to the pandemic, more than 3,000 students were expected to attend a Build My Future event April 15 in Des Moines. The popular annual event provides students hands-on learning opportunities to explore careers in the construction and design industry. The HBA of Greater Des Moines and participating partners quickly shifted the in-person event to an online format. A short video directed students to follow Iowa Skilled Trades on social media, where videos highlighting the construction industry were posted hourly. The videos can be viewed on the Iowa Skilled Trades Facebook page. The HBA of Greater Des Moines is exploring other ways to make career exploration accessible to students, including
After weakening in March, the volume of new home sales came in much better than expected in April. Due to economic challenges associated with COVID-19, NAHB was forecasting an additional sales decline in April. However, new home sales estimates from the Census Bureau reveal relatively flat conditions compared to March. The Census estimates reported a 623,000 seasonally adjusted annual rate in April, after a slightly revised 619,000 pace in March. The April rate is down approximately 20% from the peak rate in January. It is reasonable to expect a downward revision for the April data next month given persistent weakness in the labor market. Nonetheless,
virtual industry professional roundtables with Q&A opportunities for students. Brandon Patterson, who leads workforce development efforts at the HBA, advises other associations that are looking to launch virtual events to start with a Facebook Live event or Zoom meeting. “The summer will be here before we know it and we don’t want to lose those kids,” said Patterson. FABA Executive Officer Maria Moore encouraged her members to submit videos to the Spotsylvania Career and Tech Center Virtual Career Days to show students opportunities in the construction industry. The center requested short videos of professionals sharing their career stories and what a normal day on the job looks like. “We all have members we can ask to share their career story,” said Moore. “It’s easy to make a 3-minute video, especially now since we’re all accustomed to video calls, but it does take a personal call (for the request).”
You can view their videos and others on the center’s by visiting www.facebook.com/CareerDevelopmentSCPS.
mortgage application data and anecdotal reporting from builders indicates that housing demand picked up in recent weeks. Overall, the data lend evidence to the NAHB forecast that housing will be a leading sector in an eventual economic recovery. Consider that despite the recent weakness, new home sales are reported to be 1.4% higher through April than the first four months of 2019. Sales were likely supported by price incentive use in April, with NAHB data indicating that two out of ten builders used such business strategies. Indeed, median new home pricing fell to $309,900 in April, which was 8.6% lower than a year ago.
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