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Building Business News NEWS Volume 17 • NO.7

June July 2012 2011 July 2010

www.kchba.org

National is e n u J The Official Newspaper of City The Home Builders Association of Greater Kansas City The Official Newspaper of The Home Builders Association of Greater Kansas ip h s r e n w Homeo this Edition KansasInside Governor Month5!-9 See pages Signs Monumental NAHB Remodelers Awards HBA members came out in full force Tax Bill for the 2010 Annual HBA Golf Tournament Regnier Addresses P3

HBA Hosts Golf Tournament

on Friday, June 9th at the Falcon Ridge Golf Club in Lenexa, KS. Renewed interest in the tournament was gratifying for everyone involved with 144 golfers and a portion of the proceeds benefiting two important charities. Bob Regnier, President and CEO of Bank of Blue The Salvation Army and Hillcrest Transitional Valley, was the featured speaker at the May Kansas Housing were presented with checks from Area lunch. Regnier, HomeCouncil Buildersmembership Association Foundation Fund who first to support their important work. opened the Bank of Blue Valley in 1989 with its first with acommunity, continental discussed loan beingThe in day the started Deer Creek breakfast and registration where golfers could Above: New members what he was seeingand in the lending community. purchase mulligans skirts to raise extra from Beaver Timber, “We need to charities make loans, we areAlooking money for the on hand. putting for loans,” Chad Wastler, Scott Zinn, contest sponsored Thedifficult Kansas with City regulatory Star said Regnier. “It’sby been presJim Breitkreutz, and Jon where the winner brought home a new putter. Beaver sure and the business has changed dramatically over To spice up this year’s event, the last fiveTommy years.”Angotti (Factory Direct co-chairs Appliance) and Debout Swearingen Regnier pointed that while(Pinnacle most people conLeft: Mike Brown, Brown Bank) offered games throughout the day to Midwest and Bob Regnier, sider housing to have peaked in 2006, he said started keep golfers entertained. The longest drive, peaked 2003. says newfavorite homeshole, have held theiryou to the 2010 HBA Golf Tournament Sponsors Bank of Blue Valley longest in putt, and He everyone’s Thank where versus golfers five couldyears opt to putand on athinks skirt and value ago the lack of in- future projections. Aristocrat Homes Kansas City Homes and Garden tee off from the women’s tee box. ventory will drive new home prices upward. Capitol FederalRegnier said appraisals are coming but thatKansasCity.com some still Kansas in Citybetter Star featuring Finishing the day was a lunch Continental Title Company and HomeFinder.com “We’re going to see some back in come in low. Those low appraisals, combined with further implantaand awards ceremony whereinflation checks creeping were Crowley Furniture Nebraska Furniture Mart featuring B/S/H as people who want new construction will have to pay tion of legislation like the Dodd-Frank Act will continue to impact the presented to the charities and tournament Factory Direct Appliance Pacific Mutual Door & Window winners. for it,” said Regnier. industry. First American Title ProBuild Grandview Water that Closemomentum Solid criteria for making loans in paramount in to- Winnelson Stewart Title of Kansas City Regnier- The believes is critical, and that subdivisions Kitchen and Bath Showroom Tile and Stone Warehouse day’s environment. The Bank of Blue Valley has an with critical mass are the ones that will be successful. He also mainGuier Fence Company, Inc. Top Master 11-point criteria for receiving a loan. SomeHuber of the tains Woods a positive outlook on the metropolitan market as a whole. Engineered Western Chandelier Company factors they consider include net worth, liquidity, debt “This is a good market. It’s a growing market. It can’t be sustained Wilson Fans & Lighting

Kansas Area Council

service coverage, a stable revenue history andCongratulations strong by current of inventory,” to the levels Tournament Winnerssaid Regnier. 1st Place A Flight Ken Rosberg The 2012 Fall Parade ofAustin Homes returns Roeser John Judge later this year, September 29-October 14, however, now is the timeJeff to Sheppard make plans. 2nd Place A Flight Register your home earlyDon andKlamm receive a special discounted price. Josh Bright Ryan Bealmear For the Early Entry Deadline, builder informationMatt willNordstrom be the only rd information required along with payment. 3To access the registration Place A Flight Kobush page. forms, go www.kchba.org and click on the Parade Bob of Homes Gary Ely Look under Information for Builders and downloadBrandon the entry forms. Johnson Follow directions to submit or call the office, 816-942-8800. Jim Bray PRSTRT STD U.S. Postage PAID Permit No. 108 Lawrence, Ks

1st Place B Flight Harley Saxco Greg Prieb Randy Bailey Rex Fuller 2nd Place B Flight David Eickman Richard Wetzel Chris Williams BW Sterling Cramer 3rd Place Early June 15 B Flight$1,095 Russ Grossman Regular July 6 Lea Bailes $1,295 Brandon Frazee Late July 20 Todd Jennings $1,995

Fall Parade of Homes

Early Entry Discount Parade Entry Schedule Color

$1,395 $1,595 $2,295

Mark your Calendar

October 2-17, 2010

Kansas Governor Brownback Sam Tax Credit Extension signed Senate Sub for HB 2117, May 22, the controversial bill that Brownback hopes will put more money into the hands of Kansas taxpayers andEPAthey’ll use those dolResponds to Lead lars to energize the economy and create jobs. Rule The legislation slashes state income taxes by roughly $3.7 billion over five years. The plan collapses the state’s current three-bracket system to two brackets starting in 2013. It cuts the highest income tax 2010 Fall rates to 4.9 percent from 6.45 percent and 6.25 percent. It also reduces the lowest tax Builders rate to 3Home percent from 3.5Association percent. of Greater The tax measure alsoKansas allows City the state sales tax to drop by six-tenths of a cent in 2013. It retains all current itemized deductions including the mortgage interest deduction and the state, local property tax deductions. “After the longest legislative session in Kansas history and debate that reached fever Mark pitch your in ancalendar election the HBA for year, the 2010 Fall is pleased withof the final thatParade preserved Parade Homes. Sinceresult 1947, the of Homes has been Kansas City’s local resource the state’s mortgage interest deduction,” for buying a Vice new home. The 2010Sara Parade of said Executive President Corless. Homes returns October 2-17. “The HBA’s commitment all along was to ensure the final legislation was in the best inParade Entry Schedule terest of Kansas homeowners and new home July 16 buyers.” In addition, bill also $1,995 exempts non-wage Late Entrythe Deadline business income for 190,000 limited-liability companies, sole proprietorships and the The final deadline for home entires is July 16, like. That particular, is aimed at 2010. provision, Entry Home in Information, Community job creation andRegion to encourage Information, and Housingentrepreneurs Style was on June 25. To submit your entry for to startduebusinesses. the Final Deadline , visit www.kchba.net/ parade2010 or call the HBA office at (816) 942-8800

P5

P9

Parade of Homes

Final Deadline

Inside this Edition

Area Builders in Top 200

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National Homeownership Month

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June 2012

www.kchba.org

Calendar

Earn Your CSP Designation in June

NAHB Spring Board Meeting in Washington D.C. June 6 Legislative Day in Washington D.C. June 7, 10 am Parade Committee June 12, 11:30 am MO North Lunch June 13-15 Certified New Homes Sales Professional Course June 19, 11:30 am Board of Directors Meeting

June 6-9

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Master the craft of successful selling. This four-session Certified New Homes Sales Professional course is designed for specialists in new home sales. Gain a broad understanding of the home building business, discuss consumer psychology and learn the advanced techniques used by real estate veterans for greeting, closing and overcoming objections, June 13 - June 15, 9 a.m. - 5 p.m. at the HBA. See details and register at www.kchba.org.

Volume 18 • NO. 6.

NAHB’s Webinar Wednesdays Get up-to-the-minute education on industry issues, trends and best practices. No matter where you find yourself on Wednesdays, participation is easy. Even if you can’t participate in the live event, you can participate through the on-demand version. Learn more on these topics: Economics and Research, Policy and Finance, Design and Technology, Sales and Marketing, and Business Improvement. Information is online: http://www.nahb. org/conference_details.aspx?conferenceI D=2957&fromGSA=1

Plan Now to Enter the Pick of the Parade Contest

For more information or to register for any event, go to www.kchba.org or call 816-942-8800

Register for the Pick of the Parade and Distinctive Plan and Design contests to showcase your Parade Entry. Winners will be recognized at the Awards Celebration, October 3, and listed in the Kansas

City Star. Get the early deadline discoun by registering by August 3. Forms available online at www.kchba.org or contac Gina Battle, gina@kchba.org.

Build PAC Hosted Donor Appreciation Event

We believe in the home. We believe in the office park. We believe in the building and we want to help you make each one great. We operate more than 450 building material facilities all across the country, all devoted to those who create the buildings that shape America. We are ProBuild. And we believe in the building. • Decking Door/Millwork 1227 E Martha Truman Road Grandview, MO 64080 816.765.4080 Lumber Yard 103 SE Oldham Pkwy Lees Summit, MO 64081 816.246.5373

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Donors and guests gathered for an evening of celebration and appreciation for personal contributions to NAHB’s BUILD-PAC, Thursday, May 17 at the Stonehaus Farms Vineyard & Winery in Lee’s Summit. To date, more than $24,000 has been raised and will be key to BUILD-PAC’s success in the fall elections nationally.

In addition to contributions to national races your local accepts contributions to four local political action committees. Your PAC contribution allows the home building industry the opportunity to support pro-housing candidate at home and nationwide. To add your contribution in this important election year to BUILD-PAC’s efforts contact Andrew McKeegan, Andrew@kchba.org. www.kchba.org

Tony Siebert, Kenny’s Tile, presents a Build PAC contribution to Bob Frost, Frost Construction Company and Chairman of NAHB Build PAC

Building Business NewsB


Volume 18 • NO. 6

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June 2012.

Government & Politics Missouri Passes New Land Bank Legislation

LISC’s behind-the-scene efforts culminate in community support

Greater Kansas City LISC is pleased to announce that the Missouri General Assembly passed legislation supporting the establishment of a land bank in Kansas City, Mo. The legislation is the culmination of two years of behind-the-scenes efforts by Greater Kansas City LISC to introduce and educate community leaders about the benefits of a land bank to address the 12,000 vacant and abandoned properties in the Kansas City metropolitan area. “The passage of this important legislation is a victory for Kansas City residents as we all continue to seek solutions that ntreduce the number of vacant and abanct

doned properties in the urban core,” said Julie Porter, KC LISC Executive Director. More specifically, the legislation allows the City of Kansas City, Missouri to form a land bank of vacant, abandoned and foreclosed properties to help manage, sell and transfer tax delinquent land in order to return the properties to productive reuse. Allowing the City of Kansas City to form a land bank would allow the City to strategically focus on how best to utilize these properties to aid community redevelopment efforts. “Over the past two years, Greater Kansas City LISC has worked to educate civic and

community leaders about vacant property issues and share examples of how other municipalities are addressing the problem,” said David Park, Deputy Director of Neighborhood and Community Services for the City of Kansas City. Through four LISC Vacant Properties symposiums, national experts have presented new ideas and LISC facilitated broad-based community discussion. In addition, LISC brought to Kansas City one of the country’s preeminent organizations - the Center for Community Progress – to help write the land bank legislation. “Due, in part to LISC’s leadership, the

community was able to consider all options available to us and determine the best course of action,” said Crystal Williams, Jackson County Legislator. “I’m pleased that a new Kansas City land bank will be able to assume responsibility for working with neighborhoods and businesses to seek creative housing and economic development opportunities for our city.” LISC would like to commend the bill’s sponsors for their outstanding leadership. It received bi-partisan sponsorship support from Rep. Noel Torpey and Rep. Michael Brown in the House, and Sen. Victor Callahan in the Missouri Senate.

More choIceS. More StYLe. LeSS tIMe. More choIceS. More StYLe. LeSS tIMe. IntroducIng the

Signing Exhibitors

Home Show organizers are currently accepting exhibitor applications for this year’s Fall Edition to be held on September 14-16 at the Overland Park Convention Center.  Prices are held steady for booth spaces this year. Exhibitor forms are online at www.kchba.org. Contact Lori Kodanaz at 816-733-2217 or e-mail her at lori@kchba.org to reserve your space!

Building Business News

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Now you can give your customers more choices while you spend less time finishing. With the 11 Exterior colors: Mix new Andersen® A-Series system, windows trim to achieve hundred the and doors IntroducIng can arrive on the jobsite with Extensive exterior trim options: Our broad their interiors perfectly painted or stained. array of styles, colors and widths let you complement any architectural style. & door SyStem ExteriorWindoW trim installs in less time than it can 9 Interior finishes: Six d take to check voice mail. Best of all, the results choices or a primed fini Now you can give your customers more choices complement any look. arewhile undeniably beautiful. Stop in to learn more. you spend less time finishing. With the 11 Exterior colors: Mix or match colors on sash, frame and new Andersen® A-Series system, windows and doors can arrive on the jobsite with their interiors perfectly painted or stained. Exterior trim installs in less time than it can take to check voice mail. Best of all, the results are undeniably beautiful. Stop in to learn more.

trim to achieve hundreds of options.

3 Interior wood species natural pine, oak or map 9 Interior finishes: Six different factory stains, two paint choices or a primed finish let homeowners create or complement any look. 3 Interior wood species: Select from the rich grain of natural pine, oak or maple for the window or door interior.

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“ENERGY STAR” is a registered trademark of the U.S. Environmental Protection Agency. “Andersen” and all other marks where den

www.kchba.org Page©32


June 2012

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Volume 18 • NO. 6.

HBA Events & News

Ferguson Appliances Delivered to Home Show Winner It was an exciting day for the Person family of Kansas City, Missouri, when Ferguson’s truck delivered to their Northland home the brand new $8,000 appliance package that they won in the Treasure Hunt Card give-away at the Spring Home Show, Flower, Lawn & Garden show held at Bartle Hall March 24-26. Gabrielle Person was encouraged by her 8-year-old son, recently adopted from Poland, to take a chance on the package. When Lori Kodanaz, Director of Consumer & Trade Shows, called Person to arrange for delivery, Person was shocked. “You have got to be joking,” she said. “I’ve never won a thing in my life!” The generous Electrolux stainless steel

Area Builders Rank in Top 200 Kansas City builders ranked in the 2011 top 200 list according to the May issue of Builder Magazine, the magazine of NAHB. The builders listed include:

# 30 McBride & Son Companies, Chesterfield, Missouri (Midwest) with 879 closings # 32 Rausch Colman Homes, Fort Smith, Arkansas (South, Midwest, Southwest), with 823 closings #163 James Engle Custom Homes, Olathe, Kansas, with 114 closings # 198 Rodrock Homes (Brian Rodrock), Lenexa, Kansas, with 84 closings package, donated by Ferguson Enterprises, Inc., featured a 24” Dishwasher, 30” free-standing range, 29 cubic ft. refrigerator with French doors and a 30” over-the-range microwave.

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Nationally 430, 800 single family homes were built in 2011 according to census bureau data. New home sales and multi-family completions fell by more than 10.2 percent last year. Builders had hope of customers returning to the market and in some cases they did for builders ranked on the 100 list as they recorded their highest market share of closings in a decade and gained ground for the second consecutive year. Successful builders have indicated that a variety of strategies differentiate themselves in the market place. Primarily they tune into buyers wants and needs. In addition, they aggressively work to control and reduce expenses, seek out new talent in their hiring decisions, keep an eye on inventory levels, and make sure customers have a good online experience when they visit their website during their buying experience.

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David Elliott • 913-888-8211 9070 Park Hill, Lenexa, KS 66215

Congratulations to Pacific Mutual Door celebrating 100 years of business! A Century of Distinction, 1912-2012. www.kchba.org

Building Business NewsB


Volume 18 • NO. 6

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June 2012.

National Home Ownership Month

June is Homeownership Month: Celebrate the American Way of Life Each June during National Homeownership Month, Americans have the opportunity to reflect on how homeownership has enhanced our lives and contributed to the thriving communities we call home. Home builders continue to work with housing finance innovators, consumer education organizations and government officials to advance and protect affordable homeownership opportunities in our country. Homeownership is an important part of the American way of life, and there may never be a better time to buy than today.

Outstanding Opportunities With the country still emerging from the recent recession, many people are wondering if this is a good time to buy a home. The answer is easy: Yes. It’s a very good

Building Business News

time to purchase a home. Even though the housing market is beginning to recover, it is still a buyer’s market.  There are many opportunities in today’s market including affordable prices, low mortgage rates and great new homes. But market conditions can change, and these opportunities may not be around for long, so home buyers shouldn’t wait.  And despite the housing downturn, home owners still place high value on owning a home, and recommend homeownership to others.  According to a January 2012 poll*: 96 percent of home owners are happy with their decision to own, and 84 percent who are “underwater,” or owe more on their mortgages than their home is worth, expressed the same sentiment. 79 percent of home owners would

advise a family member or close friend just starting out to buy a home, and 69 percent of those who are underwater on their mortgage would offer the same advice. 74 percent said that despite the ups and downs in the housing market, owning a home is the best long-term investment they can make.  

Great Selection An excellent selection of homes on the

market makes today a very good time to buy. A plentiful inventory provides a great choice of homes, and builders that have brand new homes “move-in ready.” Additionally, many owners of existing homes who postponed trading up or downsizing due to market conditions are now ready to sell. As employment improves, the number of relocations will increase, bringing more homes into the market. (Continued on page 8)

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(816) 245-4361 • www.FFBKC.com/builders www.kchba.org Page 5


June 2012

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Volume 18 • NO. 6.

National Home Ownership Month

Homes of the Future:

What’s Hot & What’s Not Are you planning to move to a new home in the next few years? Thinking about renovating your current home so it’s more appealing to potential buyers when you do decide to move on? Or maybe you just want to change your space to follow the latest trends? Whatever your plans for your existing or future home, research from the National Association of Home Builders and Better Homes and Gardens magazine shows what features and floor plans will be popular over the next few years. According to an NAHB survey of home builders on their expectations for homes in 2015, smaller homes with lower prices and more green features will be the predominant force in the marketplace. As the average size of new singlefamily homes continues to decline to 2,377 square feet from a peak of 2,521 in 2007, floor plans are focusing on frequently-used rooms. More than half of the builders surveyed said the size of the family room will increase, while the formal living room, entry foyer and dining room are expected to decrease or disappear. Other features that builders predict are highly likely to be included in the average new home of 2015 include a walk-in closet in the master bedroom; a laundry room; ceiling fans; a master bedroom on the first floor in homes with two stories; and a two-car garage. Nearly 70 percent of the respondents

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said that homes will be greener, and about one-third expect them to have more features related to technology. The most common green features in 2015’s new homes will be low-E windows; engineered wood beams, joists or trusses; water-efficient features such as dual-flush toilets or low-flow faucets; and an Energy Star rating for the whole house. The families looking to move into new or renovated homes have high expectations for their new space as well. A December 2010 survey of Better Homes and Garden readers who consider themselves prospective home buyers or who are planning a major improvement to their home indicated that home buyers don’t want any “wasted space” in their next home and they are seeking significant value for the money they spend. Eighty-nine percent of consumers want high-efficiency heating and cooling in their next home, 85 percent want highefficiency appliances, and 78 percent want upgraded features and fixtures such as granite countertops, wood flooring, faucets and lighting fixtures. Efficient use of space also ranks highly in consumers’ desires. The top-ranked living spaces include a separate laundry room; additional storage space; walk-in closets or built-ins; a home office space, workspace or family computing center; and everyday eating space in or close to the kitchen.

NAHB Website Designed to Protect Homeownership America’s home owners and home builders celebrate National Homeownership Month in June, bringing attention to the more than 75 million Americans who own their homes, and the millions more who aspire to achieve the American dream of homeownership. But it is also important for American families to know that homeownership is under attack. Legislative and regulatory proposals now under consideration by government policymakers would greatly harm home owners, home buyers, the housing market and the nation’s economy. To educate Americans about the threats to homeownership and to provide opportunities for current and future home owners to take action to protect it, the National Association of Home Builders (NAHB) has launched a website, www.ProtectHomeownership. com. The site features expert economic analysis and reports, data from homeownership surveys and polls, and the answers to many frequently asked questions about housing and homeownership. ProtectHomesownership.com highlights the threats to homeownership by describing how tax, legislative and regulatory policies currently under con-

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sideration would scale back or eliminate the mortgage interest deduction and make mortgages and small business loans unaffordable and difficult to obtain. It tells how finance and credit-related issues are making it difficult for creditworthy, financially responsible families to buy a home and threaten to ultimately prevent millions of families from ever becoming home owners. The site documents homeownership’s importance to individual households and to local, state and national economies. It shows how new home construction and remodeling presently account for about 15 percent of the nation’s total economy, and how the financial issues are impeding production of new homes. The economic impact of home building includes construction of single-family and multifamily homes, remodeling and the countless products and services that are related to those activities.  Protecthomeownership.com also empowers the American public to take positive action to support and protect this very important aspect of American life. Visitors are encouraged to sign an online petition urging Congress to keep housing a national priority, and to join social media communities on Facebook. com/ProtectHomeownership and Twitter. com/4Homeownership. Information is provided about how to participate in Homeownership Rallies that are being held in a number of communities in 2012. The first rally, in Columbia, S.C., drew almost 1,000 people to the statehouse grounds to voice their support and focus the government’s attention on critical housing issues.

Building Business NewsB


Volume 18 • NO. 6

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June 2012.

National Home Ownership Month

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Q&A for Homebuyers Shouldn’t I wait until home prices go even lower to buy? No. Just as no one can accurately predict the peaks and valleys of the stock market (name one person who sold their tech portfolio in April of 2000), the same holds true for housing. If you wait for what you think is the absolute best deal, you could end up waiting for years. All the market fundamentals show that now is a good time to buy – prices are down, interest rates near historically low levels, and there are lots of homes to choose from. If you buy now, you will not only be in the driver’s seat during the buying process, you will also reap the gains of price appreciation. Remember, those who purchased homes in the early 1990s during the last big economic and housing downturn came out as big winners.

Doesn’t it make sense to wait out the market until can I get the same price on my home that my neighbor got when he sold a year ago? No. It’s always better to trade up in a buyer’s market. While the value of your house has fallen, the prices of higherend homes have also dropped. Here’s an example: Your neighbor sold for $300,000. Let’s say values in your area have dropped 10 percent, so you could get only $270,000 for your home today. You have your eye on a move-up home that previously sold for $500,000, but now is selling for $450,000. If you sold your home today for $270,000 and purchased the larger house for $450,000, the difference in price would be $180,000. But if you waited to recoup the 10 percent value on your home and sold it at $300,000, chances are the move-up home would also increase in price 10 percent to $500,000. That’s a $200,000 price difference. So by selling today, you would actually save $20,000.

Interest rates keep going down. Shouldn’t I wait until they go even lower before I buy a home? Interest rates for 30-year, fixed-rate mortgages are extremely favorable for buyers. In fact, they are currently hovering near 30-year lows. But waiting to time the market is a dangerous game. Even those who follow the market for a living can’t figure out when interest rates will bottom out. If they could, they would all be multi-millionaires. And home prices don’t necessarily move in unison with interest rates. So, if you decided to wait to purchase a home and the price dropped $10,000 from where it is today, you could still end up losing money. How? If interest rates were to move up by a half-a-point during this period, the savings on the reduced home price would be more than offset by the higher monthly payment you would be making over the life of the loan. Building Business News

(Continued on page 8) www.kchba.org Page 7


June 2012

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Volume 18 • NO. 6.

National Home Ownership Month (Continued from page 7)

I have $10,000 to invest. Should I put that money in the stock market or buy a home?

Purchasing a home is by far the best long-term investment. For example, say you use that $10,000 to purchase a $250,000 home, and the house appreciates a modest 3 percent during the first year. That means after one year, the house would be worth $257,500 – a gain of $7,500. By contrast, putting the same $10,000 in the stock market and posting a similar 5 percent gain would only net a $500 return on investment.

And don’t forget the tax incentives. In most instances, all of the mortgage interest and property taxes you pay in a given year can be fully deducted from your gross income to reduce your taxable income. These deductions can result in thousands of dollars of tax savings, especially in the early years of the mortgage when interest makes up most of the payment.

I’m a first-time buyer and still can’t afford the type of home that I want. Is it best to wait, keep renting, and hope that prices will get even lower? If you continue to wait, you may never be able to afford to get into the housing market. Even as home prices are currently moderating or falling, depending on where you live, rents continue to climb. When you buy a home, you are also purchasing price stability, knowing that you will pay the same monthly payment for the life of your 30-year, fixed-rate mortgage. Once you become a home owner, you are able to take advantage of the tax deductions that homeownership offers, and you begin to build equity in your property. With so many homes on the market to choose from, your best strategy may be to scale back expectations for your dream starter-home. After a few years, you can use those equity gains to sell your starter home and move into a bigger house. The sooner you make the jump from renter to home owner, the quicker you begin to create and build up wealth for your family. Page 8

New Homes Benefit More Than Just Buyers and Builders The positive impact of new residential construction is far-reaching, bringing benefits to families, businesses and services throughout a community immediately, as well as for years to come. According to economists at the National Association of Home Builders, the one-year estimated local impacts of building 100 singlefamily homes in a typical metro area include $21.1 million in local income, $2.2 million in taxes and other local government revenue, and 324 local jobs. But what does that economic impact mean in the real, day-to-day lives of community residents? Just think about it. When a family moves to a community and buys a new house, they will likely shop at local stores to buy furniture and accessories to decorate the home. They will fill their cars at local gas stations to get to stores, have local mechanics work on the car when it breaks down or needs the oil changed, or buy a new car at a local dealer when it’s time to replace the old one. The children will enroll in local schools. This increases enrollment, meaning more teachers, janitors, cafeteria workers and other school support staff will need to be hired. Those kids will also join sports leagues and

other activities, buy equipment and pay registration fees that provide stipends for referees and coaches. All of this economic activity puts income into the pockets of local business owners and their families, who can then afford to go out and spend money themselves, which recycles even more money into the community’s economy. The new family also pays local and state taxes. These tax revenues help pay for a wide range of government services, including school teachers, police departments, parks maintenance and road repairs. Over the long term, as the families who move into new homes become part of the community, their positive impact continues. NAHB estimates that those 100 new homes also provide the community with additional, annually-recurring impacts of $3.1 million in local income, $743,000 in taxes and other revenue for local governments, and 53 local jobs. Families who buy a newly built home enjoy benefits including safety, amenities, energy efficiency and floor plans to fit a modern lifestyle. But the advantages of new homes extend far beyond the buyers and the builders—residential construction has a positive, direct impact on the local community for years.

June is Homeownership Month: Celebrate the American Way of Life (Continued from page 5)

Attractive Pricing If there’s a silver lining to the recession and the housing downturn, it’s that homes in many markets are more affordable. Prices in some areas have moderated significantly, especially in major markets where they increased the most during the housing boom that occurred in most of the country.

Low Interest Rates Like inventory and pricing, mortgage interest rates are still at very favorable levels, but rates are sensitive to market forces and can change quickly. There’s no indication that rates will suddenly surge upward, but even www.kchba.org

a slight rate increase can push monthly payments to the point that a buyer might miss out on their first choice for a new home. Prospective home buyers also should be aware that lenders are looking more closely at borrowers today than in recent years. To ensure that the process goes smoothly, buyers should consider pre-qualifying for a mortgage and having financing in place before shopping for a new home. Buyers also may find that some home builders have arranged favorable financing for their customers or offer financial incentives.  

Greener and Better With energy costs (Continued on page 9)

Building Business NewsB


Volume 18 • NO. 6 (Continued from page 8) near the top of consumer concerns, it’s good to know that new homes can be more energy efficient than ever. Innovative materials and construction techniques mean that today’s new homes are built to be much more energy efficient than homes constructed a generation ago. Not only can they be more affordable to operate, new homes also are significantly more resource efficient and environmentally friendly.

Designed With Buyers in Mind Designed to accommodate today’s busy lifestyles, new homes feature open floorplans, flexible spaces, improved safety features, low-maintenance materials and other amenities that make them more appealing than ever before. And in many areas, prospective home

www.kchba.org buyers who wish to live in age-qualified communities for those 55 and older will find a large selection of homes tailored to the evolving lifestyles of the baby boom generation.

Benefits for Home Owners Homeownership also provides important benefits to owners.

Tax Benefits: For Home Owners Only Unique tax benefits that apply only to housing help lower the cost of homeownership. Both mortgage interest and property taxes are deductible. Moreover, for married couples, profits of up to $500,000 on the sale of a principal residence ($250,000 for single taxpayers) are excluded from tax on capital gains.

June 2012.

The Advantage of Leveraging Leveraging is another advantage of homeownership. A buyer can purchase a home and receive the full benefit of homeownership with a cash downpayment that is only a fraction of the total purchase price. This is called leveraging, and it makes the rate of return on a home purchase greater than on other purchases with the same value, such as stocks, where the buyer must put up the entire price.

Building Personal Resources For most Americans, homeownership is a primary source of net worth and an important step in accumulating personal financial assets over the long term. Although property values have declined in many markets, Americans currently have a total of more than $6 trillion in equity in

their homes, and for most families, home equity represents the largest share of net worth.

There Really is No Place Like Home

Although there are many positive financial aspects to homeownership, a home cannot be valued in monetary terms alone. Not only can homeownership be a steppingstone to greater financial well-being, it provides a permanent place to call home and great personal satisfaction. Academic research also shows that homeownership provides a wide range of social benefits and strengthens the nation’s people and its communities. Homeownership is truly a cornerstone of the American way of life.

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June 2012

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HBA Members

Happy Anniversary

2006 Tabernacle Homes LLC K & E Flatwork LLC

2001 Atronic Alarms, Inc. First American Title

1974 Dulaney Construction Co.

2002 KGH Building Group LLC Hardee Custom Homes, LLC

1976 Madden-McFarland Interiors 1978 Tom French Construction, Inc. 1984 O’Donnell & Sons Construction Co. 1985 MarKirk Construction, Inc.

These companies’ continued membership shows their support for the local home building industry. The strength of an association is in its membership and a thank you goes out to all of those members who continue to support the HBA. (If you know these members, please encourage them to renew and remember all the benefits they’ll miss by not renewing their membership)

2000 Liberty Homes, Inc.

1952 Ferguson Enterprises, Inc. Pacific Mutual Door & Window

2003 Apex Engineers Inc. 2004 Highland Park Builders LLC Fallbrook Building, LLC

2004 1990 C & M Builders, Inc. Straub Construction Co. Inc Childress Painting & Associates, Inc. National Bank of Kansas City Haynes Equipment Co., Inc. 1992 Shaw Construction Inc. Ashner Construction Co., Inc. 2005 1999 Martens, Inc Stewart Title of Kansas City Lumber One LLC Valley View State Bank

2007 Joseph Lane Homes LLC CrossFirst Bank Jim Larson Homes LLC 2008 Park Ridge Homes, LLC. 2009 RubinBrown LLP H & H Steel, Inc. Klein Products of Kansas 2010 Legacy Flooring Contractors NiteLites of Kansas City Absolute Access, LLC Continental Title Company 2011 Armstrong Cabinets Corporation E & M Consulting, INC.

5 Solid Reasons to Call K&E Flatwork Today!

816-746-6100 Gravel

Concrete

Page 10

Rebar

Save the Date for the NAHB Rally NAHB’s Rally for Homeownership is coming to Kansas City, September 25. Events will showcase homeownership as a top priority for policymakers as housing challenges face communities across America. Sites will be designated to feature speakers and lawmakers who will reach out to industry, business, civic and community groups.

BuildingBusinessNews THE OFFICIAL PUBLICATION OF THE HOME BUILDERS ASSOCIATION OF GREATER KANSAS CITY

June 2012 Volume 18 Issue 6 Copyright 2012 Published by the Home Builders Association of Greater Kansas City 600 E. 103rd Street, Kansas City, Mo. 64131 (816) 942-8800

Executive Vice President Sara Corless Editor Stephanie Stollsteimer Graphics Karla Peterie, Creative Services Contributing Writer Steven Cowen

Lumber

One Call We Do It All

Volume 18 • NO. 6.

2012 Executive Committee Home Builders Association of Greater Kansas City

Workers A PROFESSIONAL CONCRETE FLATWORK COMPANY • Affordable, Upfont Pricing • High-Quality Concrete Flatwork • Exceptional Customer Service • A Professionally Trained Staff • Serving Kansas and Missouri WWW.KEFLATWORK.COM www.kchba.org

President Kevin Stucker Vice President Fred Delibero Secretary/Treasurer Chris Ragland Associate Representative Kevin Kirtley Immediate Past President Travis Graham

To subscribe to Building Business News, call (816) 733-2224 To advertise in Building Business News call (816) 942-8800 For change of address requests, please fax changes to (816) 942-8367 or call (816) 942-8800 For more information, visit the HBA online at www.kchba.org

Building Business NewsB


Volume 18 • NO. 6

www.kchba.org

Welcome New Members

June 2012.

Congratulations to our new members. Let’s make them feel at home!

Beaver Timber Jon Beaver 3133 Merriam Lane, Kansas City, KS 66106 (913) 831-2518 jon@beaver-timber.com wwww.beaver-timber.com

Valor Construction Kelley Hrabe 5602 E. 139th St., Grandview, MO 64030 (816) 965-8181 info@valorconstruction.net www.valorconstruction.net/

City Wide Overhead Door Jim Jones 702 SW South Ave Blue Springs, MO 64015 (816) 444-1444 jjones@citywideoverheaddoor.com www.citywideoverheaddoor.com

SunSource Homes Inc. Keith Graepler 7832 Rosewood Ln., Prairie Village, KS 66208 (816) 783-3863 keith@sunsourcehomes.net www.sunsourcehomes.net

Prairie Homes, Inc. Robert Ewy 12917 Richards Overland Park, KS 66213 (913) 530-6161 bob@prairiehomeskc.com www.prairiehomeskc.com

Tell the story of your great homes

Building Business News

Sod Shop, Inc. Wade Wilbur 1783 E. 1500, Suite B Lawrence, KS 66044 (913) 814-0044 wade@sodshops.com www.sodshops.com

n reach Find out how you ca y Star over 1,000,000 weekl ed iz readers with a custom ntial te profile story. Show po unity m buyers why your com ll home. is a great place to ca

To advertise, call your account executive or Kate Mariani-Vacek at (816) 234-4097.

Register for events online

www.kchba.org www.kchba.org Page 11


June 2012

www.kchba.org

Let us orchestrate your dream.

Volume 18 • NO. 6.

HBA Staff

Office: 816-942-8800 Sara Corless Executive Vice President scorless@kchba.org, 816-733-2216

For the perfect products for your kitchen or bath, stop by a Ferguson showroom. It’s where you’ll find the

Gina Battle Tour & Membership Records Coordinator gina@kchba.org, 816-733-2219

largest range of quality brands, a symphony of ideas, and trained consultants to help orchestrate your dream. Come see why Ferguson is recommended by professional contractors and designers everywhere.

Marcia Jurgens Permit & Accounting Mgr. marcia@kchba.org, 816-733-2215 Stephanie Stollsteimer Director of Marketing and Communications stephanie@kchba.org, 816-733-2213 APPLIANCES Lenexa: Topeka:

PLUMBING

PASSIONATE PEOPLE

9301 Rosehille Road 2220 SE Lakewood Boulevard

©2011 Ferguson Enterprises, Inc. All Rights Reserved.

Page 12

FIXTURES

LIGHTING

(913) 752-5660 Independence, MO: 13907 E 35th Street (816) 252-0060 (785) 354-4305 FERGUSON.COM

Lori Kodanaz Director of Consumer & Trade Shows lori@kchba.org, 816-733-2217 Andrew McKeegan Association Services Manager Andrew@kchba.org, 816-733-2224 Natalie Tucker Events Support Natalie@kchba.org, 816-733-2247

Click this logo at

www.kchba.org to login to your account

Online Resources for HBA Members! Register for HBA Events Safe & secure online registration Personalized calendar of events. Notification of your events

Register for events online

www.kchba.org www.kchba.org

Update Your Membership Change your profile, contact info & membership directory listings.

Call today 816-942-8800, or email gina@kchba.org or scorless@kchba.org

Building Business NewsB


Volume 18 • NO. 6

www.kchba.org

Existing-Home Sales Rose in April

Existing-home sales rose in April and remain above a year ago, while home prices continued to rise, according to the National Association of Realtors®. The improvements in sales and prices were broad based across all regions. Total existing-home sales, which are completed transactions that include single-family homes, townhomes, condominiums and co-ops, increased 3.4 percent to a seasonally adjusted annual rate of 4.62 million in April from a downwardly revised 4.47 million in March, and are 10.0 percent higher than the 4.20 million-unit level in April 2011. Lawrence Yun, NAR chief economist, said the housing recovery is underway. “It is no longer just the investors who are taking advantage of high affordability conditions.  A return of normal home buying for occupancy is helping home sales across all price points, and now the recovery appears to be extending to home

June 2012.

New Home Sales Up in April

prices,” he said. “The general downtrend in both listed and shadow inventory has shifted from a buyers’ market to one that is much more balanced, but in some areas it has become a seller’s market.” Total housing inventory at the end of April rose 9.5 percent to 2.54 million existing homes available for sale, a seasonal increase which represents a 6.6-month supply at the current sales pace, up from a 6.2-month supply in March.  Listed inventory is 20.6 percent below a year ago when there was a 9.1-month supply; the record for unsold inventory was 4.04 million in July 2007. “A diminishing share of foreclosed property sales is helping home values.  Moreover, an acute shortage of inventory in certain markets is leading to multiple biddings and escalating price conditions,” Yun said. He notes some areas with tight supply include the Washington, D.C.; Miami; Naples, Fla., and Phoenix.

Sales of newly built, single-family homes rose 3.3 percent in April to a seasonally adjusted annual rate of 343,000 units, according to newly released data from HUD and the U.S. Census Bureau. “The increase in April sales activity is in line with other important housing measures that have shown continued, gradual improvement from the first quarter as more consumers look to take advantage of today’s low interest rates and affordable home prices,” noted National Association of Home Builders (NAHB) Chairman Barry Rutenberg, a home builder from Gainesville, Fla.

“In markets where demand is rising, we could be seeing a faster pace of recovery if not for persistently tight lending conditions that are slowing both the building and buying of new homes.” “Today’s report is representative of the kind of modest but consistent gains that we expect to see in new-home sales through the remainder of 2012,” said NAHB Chief Economist David Crowe. “As indicated by our most recent builder surveys, more consumers are taking advantage of historically low mortgage rates amidst firming economic and job market conditions in certain areas.”

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HBA 2012 SPONSORS

June 2012

Page 14

www.kchba.org

Platinum

Bank of Blue Valley

Gold

SILVER Henges Insulation & Fireplace Phelps Engineering ProBuild United Heating & Cooling

Capitol Federal Factory Direct Ferguson Enterprises bronze First Federal Bank Commerce Bank K & E Flatwork Complete Home Concepts Kansas City Star First American Title Kenny’s Tile Hermes Landscaping McCray Lumber & Millwork Kansas City Title Kitchens & Baths by Briggs Nebraska Furniture Mart Pacific Mutual Door Owen Lumber Pella Products Shamrock Cabinet ProSource of Lenexa Sun Lumber Western Chandelier Weber Carpet

www.kchba.org

Volume 18 • NO. 6.

Starts in New Home Construction Continue at Positive Pace “Homes are being built, ground is being broken, and lots are selling as the Home Builders Association reports a 50 percent increase in permit activity over the same four months of 2011,” according to Executive Vice President Sara Corless. January through April’s permits totaled 915 outpacing 601 last year. This is the

highest four months of activity since 2008 when permits totaled 1,277. April marks the fourth consecutive month in which starts showed improvement over the same month last year with 277 over 210 in 2011. “Builders reported increased traffic as well as increased sales during April’s Parade of Homes” said Corless. “Home sale closings in May indicate permit activity will continue into the summer.” The top four counties ranked by permit numbers are Johnson, Clay, Jackson and Platte, respectively. Of note, Platte County has increased its share of permits year or year from 7 to 12 percent.

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Volume 18 • NO. 6

Building Business News

www.kchba.org

June 2012.

www.kchba.org Page 15


June 2012

www.kchba.org

Volume 18 • NO. 6.

Top 5 Reasons to Become Involved Within NAHB 1. Networking with your fellow members from other states. Expanding who you know is very important in life and with social media sites like Facebook and LinkedIN our world is expanding like the original “Big Bang.” You never know who you could help and who could help you by increasing your professional network. NAHB involvement is the positive step to take in that direction. 2. Taking part on a national committee. Members from different areas of the United States work towards like-minded goals. Not only can this help you with the committee work back home at your local with similar committees, it also help you become a better professional, working with such a diverse group of people. The

Page 16

mannerisms, the attitudes, the way others “look at life” are so varied but it helps you develop a unique set of people skills you wouldn’t normally receive by being bound within your own state. 3. Learn about advocacy for our members at the federal level. Now more than ever, “The Hill” is where our industry will recover. Gaining insight to the advocacy process not only helps you understand what affects you, but helps you take action to protect yourself. 4. Gain a better understanding of housing issues in other areas of the country. When certain anti-home-building groups find a successful tactic it becomes only a matter of time before it spreads like weeds in your garden. What happens in

New Jersey and California, our two most industry legislated and regulated states, has and will appear elsewhere. It’s great to know, if there is a particular plan to stop housing in your state that others have already “been there, done that” and could help you plan and prepare. 5. Engage in discussion about best practices. NAHB builder members have a program designed to help them called “The Builder 20 Club” designed to help these members discuss their businesses with their peers, but peers that are no competition because they are in different parts of the country. While associates don’t have that particular program we do have our NAHB Associate Members Committee which can give you the same types of discussions.

www.kchba.org

As an example, if you are a marketing professional in your state and you would like to discuss tactics on growing your business, someone who is your competitor is not likely to help. However, a fellow marketer from another state that you have successfully networked with and developed into a friendship would. Open your minds to the idea that not all things are confined within a state and let the world of our Federation flow toward you.

By Dianne Beaton, CGA, CAPS. Dianne is the 2012 NAHB Associate Members Committee Chairman and is an associate member from New Hampshire.

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Profile for Home Builders Association of Greater Kansas City

Building Business News June 2012  

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