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NAIL The official magazine of Home Builders Association of Middle Tennessee President Randall Smith Vice President John Zelenak Secretary/Treasurer Keith Porterfield Executive Vice President John Sheley Editor and Designer Jim Argo Staff Connie Nicley Pat Newsome
THE NAIL is published monthly by the Home Builders Association of Middle Tennessee, a non-profit trade association dedicated to promoting the American dream of homeownership to all residents of Middle Tennessee. SUBMISSIONS: THE NAIL welcomes manuscripts and photos related to the Middle Tennessee housing industry for publication. Editor reserves the right to edit due to content and space limitations. POSTMASTER: Please send address changes to: HBAMT, 9007 Overlook Boulevard, Brentwood, TN 37027. Phone: (615) 377-1055.
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FEATURES 9 Preparing to buy a new home in 2016
It’s a great time to buy and these tips will help you ensure that you’re fully prepared to find and buy next home.
10 Home design trends to look for in the upcoming year
NAHB’s Best in American Living Awards provide a great look at the trends that will be inspiring designs in the coming months and years.
DEPARTMENTS 6 News & Information 13 SPIKE Club Report 14 April Calendar 14 Chapters and Councils
ON THE COVER: April is New Homes Month. Find tips on buying a new home and current design trends on page nine and ten. April, 2016
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New home sales rise 2 percent in February
ales of newly built, single-family homes rose 2 percent in February from an upwardly revised January reading to a seasonally adjusted annual rate of 512,000 units, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. “The February bounce back in sales is in line with our builders’ reports that the housing market continues to recover at a slow but
Despite labor shortages, relatively low mortgage interest rates and solid job growth should keep the housing market moving ahead as we enter the spring buying season. 6 The NAIL
steady pace,” said Ed Brady, chairman of the National Association of Home Builders (NAHB) and home builder and developer from Bloomington, Ill. “While builders contend with industry headwinds such as labor shortages, relatively low mortgage interest rates and solid job growth should keep the housing market moving ahead as we enter the spring buying season,” said NAHB Chief Economist Robert Dietz. The inventory of new homes for sale was 240,000 in February, which is a 5.6-month supply at the current sales pace. The median sales price of new houses sold in February was $301,400. Regionally, new home sales rose 38.5 percent in the West. Sales dropped 4.1 percent in the South, 17.9 percent in the Midwest and 24.2 percent in the Northeast. n
Housing starts reach 8 year high, builder confidence steady
ationwide housing starts rose 5.2 percent to a seasonally adjusted annual rate of 1.178 million units in February, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department. Single-family production increased 7.2 percent to 822,000 units—its highest level since November 2007— while multifamily starts remained virtually unchanged, inching up 0.8 percent to 356,000 units. “This month’s report is consistent with positive builder sentiment and economic indicators showing that the housing market continues to recover at a gradual pace,” said NAHB Chairman Ed Brady. “February’s single-family gains indicate that this sector is strengthening in line with our forecast,” said NAHB Chief Economist David Crowe. “As the U.S. economy firms, job creation continues and mortgage interest rates remain low, we should see further growth in housing production moving forward.” Combined single- and multifamily starts rose in three of the four regions in February, with the West, Midwest and South posting respective gains of 26.1 percent, 19.9 percent and 7.1 percent. The Northeast registered a 51.3 percent loss. A decline in the volatile multifamily sector pushed overall permit issuance down 3.1 percent in February. Multifamily permits fell 8.4 percent to a rate of 436,000 while single-family
permits ticked up 0.4 percent to 731,000. Regionally, permits increased in the Northeast by 40.4 percent. The Midwest, West and South registered respective permit losses of 11.4 percent, 7.2 percent and 4.4 percent. Additionally, certified renovators who were grandfathered in under a HUD or EPA leadbased paint training course before the RRP rule was adopted must attend a refresher course with a hands-on component. The rule also made several streamlining and clarifying changes to RRP
provisions that apply to training providers. The EPA’s changes only apply to those states where EPA administers the program; the 14 states that administer their own programs will have to take legislative or regulatory action to adopt the online refresher course option. Builder confidence holds steady Builder confidence in the market for newly-built single-family homes was unchanged in March
Rare snapshot of builders’ profitability and expenditures
he Cost of Doing Business Study, 2016 Edition, a national study of single-family builders’ financial performance, was recently released by BuilderBooks, the publishing arm of the NAHB. The Cost of Doing Business Study gives builders the opportunity to see industry averages for profit margins, asset levels and equity positions. NAHB builder members from all regions of the country provided their past financial data using a survey instrument developed by NAHB’s Economics and Housing Policy Group. This new resource provides home builders a rare glimpse at other builders’ financial books, with access to data on profitability, cost of sales and expenses from home builders.
“The Cost of Doing Business Study contains a wealth of information about the residential construction industry and is a critical resource for builders,” said NAHB Chairman Ed Brady. “The updated study provides the benchmarks builders need to improve their businesses.” Readers can see how they measure up against industry-wide averages in areas including:
at a level of 58 on the NAHB/Wells Fargo Housing Market Index (HMI). “Confidence levels are hovering above the 50-point mid-range, indicating that the single-family market continues to make steady progress,” said Brady. “However, builders continue to report problems regarding a shortage of lots and labor.” “While builder sentiment has been relatively flat the last few months, the March reading correlates with NAHB’s forecast of a steady firming of the single-family sector in 2016,” said Crowe. “Solid job growth, low mortgage rates and improving mortgage availability will help keep the housing market on an upward trajectory.” Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor. The HMI component gauging current sales conditions held steady at 65 in March while the index measuring sales expectations in the next six months fell three points to 61. The component charting buyer traffic rose four points to 43. Looking at the three-month moving averages for regional HMI scores, the Midwest posted a onepoint gain to 58 while the South was unchanged at 59. The West registered a three-point decline to 69 while the Northeast fell one point to 46. n
their performance against the data. More than 35 proven cost-cutting, profit-raising ideas that builders can apply to their businesses are provided. The Cost of Doing Business Study is available for purchase ($149.95 retail/$79.95 NAHB member, ISBN 978-0-86718-7465) at BuilderBooks.com or by calling 800223-2665. The eBook is available at ebooks. builderbooks.com ($89.99 retail/$55.99 for NAHB members). n
- Gross margin & net profit - Cost of goods sold - Gross margin & net profit - Cost of goods sold Several categories are analyzed in the survey--volume, operation type and land vs. no land--making it easy for builders to compare
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Help your customers with the newest version of the RCPG
ooking for a great addition to your warranty programs? Provide a copy of the newest version of the Residential Construction Performance Guidelines for Professional Builders & Remodelers (5th Edition) to home buyers as part of your warranty claims process. NAHB BuilderBooks recently revised and updated the contractor and consumer versions of the guide, a well-regarded industry resource for the past 20 years. This unique collection of 275+ guidelines in 12 major construction categories is designed to help builders and remodelers successfully manage customer expectations, protect their bottom line and deliver high-performance homes. Specifically, the RPCG Consumer Reference helps customers better understand the construction process; basics of a properly constructed or remodeled home; and warranty and maintenance items. It serves as a quick reference on the minimum ac-
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ceptable performance for the most common maintenance and structural issues that come up in new home residential construction and remodels. Providing a copy to consumers at or prior to a contract signing may help resolve customer concerns before they escalate into complaints, disputes or worse. The RPCG Consumer Reference includes performance guidelines for: - Site work and foundation - Floors, walls and roofs - Plumbing and electrical, including interior climate control - Interior and floor finishes - Fireplaces and woodstoves - Concrete stoops and steps - Garage, driveways and sidewalks - Wood decks - Landscaping
The revised version of the RCPG Contractor Reference features: - New guidelines that address efflorescence, deflection, water penetration and other issues - Sample contract language - Remodeling-specific guidelines - Tips for taking critical measurements Both versions are available for purchase at BuilderBooks.com or by calling 800-2232665. The Contractor Reference is $44.95 retail or $39.95 for NAHB members, and the Consumer Reference is $69.95 retail or $59.95 for NAHB members (in a pack of 10). The eBook (contractor version only) is available at ebooks.builderbooks.com for $31.99 retail or $26.99 for NAHB members. n
Preparing to buy a new home in 2016
hen winter gives way to spring, the temperatures won’t be the only things on the rise. The home-buying market tends to heat up as well during the spring, and 2016 will be no exception. Many savvy buyers will be looking to lock in attractive interest rates while they still remain low. If this group includes you, the time to start preparing is now. These tips will help put you in a better position to find a home perfect for you just in time for New Homes Month. Make your Checklist First-time home buyers should take the time to determine what their needs are, especially regarding size, location and amenities. But even seasoned home owners will find that having a must-have list can save significant time by helping them avoid listings that may look great in the photos, but in reality, won’t meet their needs. Home buyers should always prioritize the items on their checklists, as most will need to compromise on some items to fit within a realistic budget. Check Your Credit Score Even if you’ve purchased a home in the past, stricter credit requirements are making it more challenging for some buyers to find home loans. Lenders are more cautious than ever, so having a favorable credit score can make a difference in your ability to be approved for a loan. Even if you think nothing has changed recently on your credit report, it’s good to check periodically to ensure you aren’t being unfairly penalized for old debts, which can sometimes linger on credit reports. Borrowers with
scores in the low 600s and even high 500s can still find lenders who will qualify them, but borrowers should strive for scores in the mid- to upper-700s to land the best rate. Determine What You Can Afford Don’t let your maximum loan approval amount dictate what your home-buying budget should be. Though the approval process is more extensive now than it was even just a few years ago, lenders still want to make as much profit as possible. You, however, are the best person to judge what you can realistically afford. Experts say that your total monthly home expenses should not exceed more than one-third of your gross monthly income. You’ll also need to determine how much you’ll need in order to cover any loan fees and closing costs. Sell Your Current Home If buying a new home is contingent on the sale of your current home, it’s a good idea to start the process by reaching out and consulting with your realtor. Ask him or her about your best strategy to sell your home quickly, but at the right time and for the best price possible. You’ll want to identify any maintenance issues your home has, and determine if, how and when each one will need to be addressed. You can also ask your realtor if making any upgrades to your current home would be worthwhile and result in a favorable return when it comes time to sell. For more information about the home buying process, contact the HBAMT at 615-377-1055 or visit www.hbamt.org. n April, 2016
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Get inspired with these new home trends
he NAHB recently announced the winners of the Best in American Living Awards (BALA) – a prestigious awards program recognizing excellence in designs that will influence the entire residential building industry. Award recipients are lauded as the nation’s most creative and inventive builders, remodelers, architects, developers, land planners and interior designers. Below are some of the newest trends in home design that buyers throughout Middle Tennessee will see in the coming months and years, based on submissions from this year’s BALA winners. Some of these elements are sure to inspire your next design project.
Intimate Outdoor Spaces. Many single-family custom and production homes include intimate outdoor gathering spaces, complete with outdoor fireplaces or fire pits and cozy seating. These spaces are geared toward smaller gatherings, instead of the extended family-size backyards of the past.
Interior Board and Batten. More often used as exterior cladding, board and batten is now being featured inside a large number of homes as well. This technique adds a three-dimensional layer to interior finishes and provides an interesting alternative to paint and wallpaper. White with Exotic or Repurposed Wood Accents. Many winning interiors feature stark, modern white paired with rich wood accents, a striking combination in flooring, ceilings and cabinets. Modern Industrial Accents. Making its strongest appearance in multifamily projects, this trend combines sleek lighting and furniture with the brick, glass and steel elements of a building’s shell and skeleton. Vibrant pops of color offset the cooler color palette of metals and whites. Barn Doors. Barn doors are appearing everywhere, from kitchens to mudrooms to closets. These offer an alternative to traditional left- or right-hung doors & become a design feature of the home, unlike pocket doors that tuck away.
Mid-Century Modern Detailing. Mid-century modern is now 21st century chic in furniture, elevation design and detailing. Particularly in the western United States, this style has become increasingly popular.
Intricate Stairways. Stairways have become more prominent and sophisticated. Designers increasingly feature curving glass railings, detailed iron newel posts, unique stair accent walls, glass treads and intricate tile work..
Indoor-Outdoor Convergence. What was once a distinct line between two areas – indoor & outdoor – has been replaced by floor-to-ceiling retractable glass walls & screens. Families can visually & physically move between the areas.
Waterfall Islands. Still trending are waterfall-edged islands, in which the kitchen bar is inset into the cabinetry rather than extended beyond it. These islands – whether wood, granite or marble – emphasize clean, modern lines.
Troughs and Spouts. Outdoor tables with open, trough-like water channels add interest, often culminating in a delicate waterfall off the edge of the table into a pool or water feature below.
To find an industry professional who is ready to bring these exciting new trends to your new home or remodeling project, contact the HBAMT at 615-377-1055, or go to www.hbamt.org. n
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SPIKE REPORT Life Spikes
Twenty-two SPIKES (in bold) increased their recruitment numbers last month. What is a SPIKE? SPIKES recruit new members and help the association retain members. Here is the latest SPIKE report as of February 29, 2016. Top 20 Big Spikes Jim Ford 912 Virgil Ray 821 Bill King 776 Mitzi Spann 711 Terry Cobb 567 Jim Fischer 566 John Whitaker 462 Jennifer Earnest 347 James Carbine 345 Kevin Hale 287 David Crane 278 Tonya Jones 271 Trey Lewis 270 Reese Smith III 261 Steve Moody 219 Sonny Shackelford 219 Davis Lamb 196 Tim Ferguson 176 Jackson Downey 174 James Franks 172
Jim McLean 164 Louise Stark 163 Harry Johnson 146 Steve Cates 141 C.W. Bartlett 138 Tonya Alexander 128 Sam Carbine 128 Steve Hewlett 119 Carmen Butner 108 B.J. Hanson 105 Dave McGowan 104 Johnny Watson 101 Julie DuPree 97 Jordan Clark 94 Duane Vanhook 91 Jeff Zeitlin 87 Erin Richardson 76 Wiggs Thompson 75 Jeff Slusher 70 John Baugh 68 Michael Dillon 68 Don Bruce 62 Jim Ford, Jr. 62 Beth Sturm 59 Hill McAlister 57 Lori Fisk-Conners 55 Joe Morgan 54 John Broderick 53 Gerald Bucy 53 David Hughes 51 Al Davis 47 Christina Cunningham 46 Andrew Neuman 46 Benny Sullivan 46 John Ganschow 45 Bryan Edwards 44 Kay Russell 44
Peggy Krebs 40 David Lippe 38 Andy Wyatt 37 Chuck Clarkson 36 Frank Miller 36 Randall Smith 36 Brad Butler 35 Al Hacker 34 Derenda Sircy 33 Ray Edwards 32 Dan Strebel 32 Justin Hicks 31 Steve Wheeley 30 John Zelenak 29 Alvin Basel 29 Marty Maitland 27 Spikes Don Mahone 22 Frank Tyree 17 Ashley Crews 13 Ricky Scott 13 Gina Hewlett 10 Keith Porterfield 10 Ron Schroeder 10 Don Alexander 9 McClain Franks 6
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APRIL Calendar Sunday
Sales & Marketing Council meeting
Dickson County Chapter meeting
Sales & Marketing Council meeting
Metro/Nashville Chapter meeting
Sales & Marketing Council meeting
Chapters & Councils CHAPTERS
Robertson County RSVP line: 615-377-9651, ext. 313.
Council RSVP Line: 615/377-9651, ext. 308
CHEATHAM COUNTY CHAPTER Chapter President - Roy Miles: 615/646-3303 Cheatham County Chapter details are being planned. Next meeting: to be announced. Chapter RSVP Line: 615/377-9651, ext. 310
SUMNER COUNTY CHAPTER The Sumner County Chapter meets on the fourth Tuesday of the month, 11:30 a.m. at the new Hendersonville Library. Next meeting: to be announced. Chapter RSVP Line: 615/377-9651, ext. 306
DICKSON COUNTY CHAPTER Chapter President - Mark Denney: 615/446-2873. The Dickson County Chapter meets on the third Monday of the month, 12:00 p.m. at the Ponderosa Restaurant in Dickson. Next meeting: Monday, April 18. Price: FREE, lunch dutch treat. Chapter RSVP Line: 615/377-9651, ext. 307
WILLIAMSON COUNTY CHAPTER Chapter President - BJ Hanson: 615/884-4935. The Williamson County Chapter meets on the third Tuesday of the month, 11:30 a.m. at the HBAMT offices. Next meeting: to be announced. Builders Free pending sponsorship. Price: $10 per person with RSVP ($20 w/o RSVP). Chapter RSVP Line: 615/377-9651, ext. 305
HBAMT REMODELERS COUNCIL Council President - Ricky Scott. The HBAMT Remodelers Council meets on the third Wednesday of the month, 11:00 a.m. at varying locations. Next meeting: Wednesday, April 20. Location: to be announced. Topic: to be announced. Price: free for RMC members with RSVP; $15 for non-members with RSVP ($20 w/o). Council RSVP Line: 615/377-9651, ext. 301
MAURY COUNTY CHAPTER Maury County Chapter details are currently being planned. Next meeting: to be announced. Chapter RSVP line: 615-377-9651, ext. 312; for callers outside the 615 area code, 1-800-571-9995, ext. 312 METRO/NASHVILLE CHAPTER Chapter President - John Whitaker: 615/843-3300. The Metro/Nashville Chapter meets on the fourth Monday of the month, 11:30 a.m. at the HBAMT offices. Next meeting: Monday, April 25. Topic: to be announced. Builders Free pending sponsorship Price: $10 per person with RSVP ($20 w/o RSVP). Chapter RSVP Line: 615/377-9651, ext. 304 ROBERTSON COUNTY CHAPTER Next meeting: to be announced.
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WILSON COUNTY CHAPTER The Wilson County Chapter meets on the second Thursday of the month, 11:30 a.m. at the Five Oaks Golf & Country Club in Lebanon. Next meeting: to be announced. Chapter RSVP Line: 615/377-9651, ext. 309 COUNCILS GREEN BUILDING COUNCIL Council President - Erin Richardson: 615/883-8526. The Green Building Council meets on the fourth Wednesday of the month, 11:00 a.m. Next meeting: to be announced. Topic: to be announced. Price: free for Green Building Council members pending sponsorship; $20 for non-members with RSVP ($25 w/o).
INFILL BUILDERS COUNCIL The Infill Builders meets on the third Thursday of the month, 11:30 a.m. at the HBAMT offices until further notice. Next meeting: to be announced. Council RSVP Line: 615/377-9651, ext. 311 MIDDLE TENN SALES & MARKETING COUNCIL Council President - Jody Derrick. The SMC meets on the first Thursday of the month, 9:00 a.m. at the HBAMT offices. Next meeting: Thursday, April 7. Topic: “Avoiding Data Risks and Disasters,” with tech expert Bill Dotson, Rocker Risk, LLC. SMC members free with RSVP thanks to DeBerry Insurance; non-SMC members $25 w/RSVP, $35 w/o RSVP Council RSVP Line: 615/377-9651, ext. 302.
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The April, 2016 issue of The Nail, the official monthly publication of the Home Builders Association of Middle Tennessee (HBAMT).