Building Business News May 2014

Page 1

May 2014

Clean Water Act Expansion Not the Right Answer, NAHB Says

Board of Directors Endorses Dean Mon Page 6 Membership Advantages Page 8 Member Q&A Page 9 Home Builders Give Back to Community Page 13

Home Show Brought Spring to Bartle Hall Pages 4 and 5

The Environmental Protection Agency’s (EPA) proposal to expand the reach of the Clean Water Act will increase the cost of new homes without a corresponding benefit to America’s lakes, rivers and other water bodies according to the National Association of Home Builders (NAHB). While NAHB has long asked for the rulemaking, EPA’s proposal goes too far. “EPA was told to make changes to the rule so that everyone understands exactly when a builder needs a federal wetlands permit before turning the first shovel of dirt,” said Kevin Kelly, NAHB president and a home builder and developer from Wilmington, Delaware. “Instead, EPA has added just about everything into its jurisdiction by expanding the definition of a ‘tributary’ – even ditches and manmade canals, or any other feature that a regulator determines to have a bed, bank and high-water mark. It’s a waste of taxpayer resources to treat a rainwater ditch with the same scrutiny as we would the Delaware Bay,” Kelly said Expanding federal authority under the Clean Water Act would greatly increase the number of construction sites required to obtain appropriate permits, which will also result in the delay or impede construction projects. Moreover, additional permits will burden the current exorbitant backlog of permits ranging between15,000 to 20,000. Enacted in 1987, the Clean Water Act continues to be a source of confusion for both regulators and those subject to regulation – and just what land should fall under federal, as opposed to state or local, permitting authority. It was originally designed to provide federal protection to navigable waters and those used for interstate commerce, but the limits of that protection were never clear. The new definition doesn’t just affect home builders. Farmers and ranchers

could also feel an impact on their business practices. Even home owners could need wetlands permits before doing landscaping projects if regulators determined that their land included a ‘tributary’ and thus subject to federal oversight. “It’s clear to us that this new proposal is not at all what Congress intended when it told EPA to clarify its jurisdictional reach,” Kelly said. “The agency needs to go back to work on this. We need to protect the environment with a carefully crafted rule, not this hurried, catch-all attempt.

Adding this layer of regulation makes the land development process more expensive and time consuming. That’s bad news for home buyers and for the economy. The proposed rule was published in the Federal Register on Monday, April 21, 2014. The public comment period will be open for 91 days and will close on Monday, July 21, 2014. To submit a comment go to http://www2.epa.gov/uswaters and click on “submit your comments” near the bottom of the page.

Spring Parade of Homes Underway Kansas City’s spring home-buying season got officially underway with the opening weekend of the Spring Parade of Homes on April 26th. Requests for the Parade Guide started in early March and the books flew off the rack as soon as they arrived. Builders worked hard to put the finishing touches on their homes for the opening weekend. Potential homebuyers have travelled across the eight county metropolitan area as they’ve toured the 377 entries on this year’s Spring Parade of Homes. Analysis of the homes entered in the Continued on page 2 parade shows


www.kchba.org | Volume 20, No. 5 | May 2014

May Calendar New Homes are Less May 8

Associates Council Meeting

Thru May 11

Spring Parade of Homes

May 1-31

Membership Drive

May 20

Board of Directors Meeting

Expensive to Maintain

Here is important information to share with your potential homebuyers: one of the virtues of a newly constructed home is the savings that come from reduced energy and maintenance expenses.

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

For routine maintenance expenses, 26% of all homeowners spent $100 or more a month on various upkeep costs. However, only 11% of owners of newly constructed homes spent this amount. In fact, 73% of new homeowners spent less than $25 a month on routine maintenance costs.

Spring Parade of Homes Underway Continued from page 1 that the median price is $379,900 and that reverse story and a half and story and a half are the most popular styles with 183 homes fitting those descriptions. The homes have an average of 4 bedrooms and 3.5 bathrooms. A main floor master bedroom is a feature of 211 homes. Of the community amenities available, 260 homes are in neighborhoods with pools, 218 have walking trails nearby and 126 have either a city or subdivision park. After judging was held on April 25 and 26, winning entries in the American Dream

Awards contest were announced on April 30. Those homes will appear in the June issue of the Building Business News. The Parade of Homes is always an exciting time for the Kansas City Home Builders Association and this year’s event has been no exception. We extend our appreciation to all builders and developers who make the Parade possible, to the members of the Parade Committee for their leadership, to United Heating & Cooling for delivering and unloading the Parade Guides and to the Parade Sponsor, Stewart Title.

Similar findings are available for energy expenses. According to the 2011 AHS (American Housing Survey), on a median per square foot basis, homeowners spent 81 cents per square foot per year on electricity. Owners of new homes spent less: 68 cents per square foot per year. For homes with piped gas, homeowners spent on average 50 cents per square foot per year. Owners of new homes spent just 34 cents per square foot per year. The 2011 data show similar results for various other utilities. For water bills,

homeowners averaged 28 cents per square foot per year, while owners of new homes averaged 22 cents. These data highlight that a new home offers savings over the life of ownership due to reduced operating costs. And in fact, these reduced costs result in lower insurance bills as well. The median cost for all homeowners of property insurance is 39 cents per square foot, while it is only 31 cents per square foot for owners of new homes. These reduced expenditures represent one of the many reasons that the current system of appraisals needs updating to reflect the flow of benefits that come from features in a new home.

This month’s tip is: Plan Now for the Fall Parade and Contest Even though the Spring Parade of Homes is just now finishing, it is not too early to start thinking about the Fall Parade (Sept 27 – Oct 12). An especially valuable part of the Fall Parade are the two contests: Pick of the Parade and Distinctive Plan & Design. These two contests offer a home builder the opportunity for increased visibility through inclusion in Kansas City Star stories and advertisement, listing in the Spring 2015 Parade Guide, and the ability to include the winning designations in your own promotional materials.

Resource Tip

The Pick of the Parade contest focuses on quality of exterior and interior construction, curb appeal, and overall atmosphere of the home. As the name implies, Distinctive Plan and Design entries are judged on the appearance, creativity, and efficiency of the home. Contest entries are judged by home building professionals from outside the Kansas City area who donate two days of their time to participate in the event. In addition to scoring the homes on a point basis, judges write specific comments which can assist home builders with workmanship issues and design elements. For information regarding the Fall Parade and contests, please contact Gina Battle at gina@kchba.org. 2


May 2014 | Volume 20, No. 5 | www.kchba.org

Design Trends for 2014 and Beyond The National Association of Home Builders recently announced the winners of the Best in American Living Awards – a prestigious award program that spotlights design excellence for the entire residential building industry. Award recipients represent the forefront of innovative design in America, and are lauded as the most creative and inventive builders, remodelers, architects, developers, land planners and interior designers in the nation. Based on submissions from this year’s crop of winners, some of the newest trends in design that home buyers will see over the next several years include: White on White – Cabinets, flooring, backsplashes, counters, fixtures and appliances are beginning to lighten up. Layering white on top of white is a new approach in many kitchens and bathrooms that is giving way to a fresh and light feeling. To achieve clean lines and a modern feel, designers and builders are selecting European cabinetry, adding shiny surfaces via appliance, backsplash and countertop choices, and incorporating glass walls.

Installing traditional batt insulation, three types of sprayed in wall fiber, fiberglass & cellulose blow, open & closed cell foam, rigid foam board, and fireplaces.

Bold Exterior Colors – Bold colors are making their way to the exterior of homes. Whether it’s through paint, a mix of cladding materials, doors, windows, porches, shutters or trim, an extra layer of drama is being adding to the design of elevations, further enhancing curb appeal.

designs through color, finish, fixture and lighting selection, while continuing to be influenced by the past through the use of reclaimed building materials and classic proportions and detailing. Blurring the Lines Between Inside and Out – Lines continue to be blurred be-

Interior Courtyards – Interior courtyards are popular in all housing types right now. The primary difference is scale. Within single-family homes, courtyards provide private and safe outdoor living areas and are being shifted to side yards.

tween the inside and outside of homes. No longer limited to areas with warmer climates, this is being seen all across the country. More homes now feature moveable glass walls, gourmet outdoor kitchens and interior courtyard pools, adding more everyday living space.

Most Likely Features in 2014 Homes Knowing what your competition is up to is a must in any industry. In residential construction, that includes having a clear picture of what other builders are putting in their new homes. In December 2013, a nationwide survey asked builders about the likelihood that a number of features would be included in the typical single-family home they will build this year.

Specialty Lighting – Specialty fixtures are “lighting it up” this year. Regardless of whether it involves a custom or a stock fixture, designers are finding ways to showcase them as pieces of art rather than just a functional element. Lighting is being paired with wood ceiling details to further enhance the room’s design and create a feeling of warmth.

Based on ratings from 1 to 5, where 1=not at all likely and 5=very likely, builders reported the following as most likely features to show up in the typical 2014 home: walk-in closet in master bedroom, low-e windows, laundry room, great room.

Historic Style with Modern Flair – New or remodeled homes, whether they are Craftsman, Prairie, Mid-Century Modern or another historic architectural style, are adding modern flair to their traditional

Also likely are a number of energy efficiency features: Energy-star rated

appliances and windows, a programmable thermostat, and insulation higher than required by code. In the kitchen, a double sink, granite countertops, and a central island are highly likely to make the cut. A few outdoor features are likely candidates as well: a front porch, outdoor lighting, and a patio. In contrast, the two least likely features builders will include in their new homes this year are: laminate countertops in the kitchen, outdoor kitchen (cooking, refrigeration, & sink) Two-story spaces (family room and foyer) also seem to be unlikely features, as well as an outdoor fireplace, a sunroom, a media room, and a whirlpool in the master bathroom.

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www.kchba.org | Volume 20, No. 5 | May 2014

Home Show Brought Spring to Bartle Hall Many hours of hard work, near-perfect weather and consumers eager to jump into spring projects all combined to make the sixty-sixth annual Home Show and Flower, Lawn & Garden Show a success. Fifteen thousand attendees browsed the 260 booths and kept the chairs full at the Spaces Stage for each presenter. In addition, the Builders Row Trade Show and Education event brought numerous home builders to Bartle Hall. Special appreciation goes to the following: Chris Ragland, Homes by Chris, for envisioning the Love Shack and bringing it to reality. Her partners in this project were: Advantech

James Hardie

Cripple Creek Rock Co.

Elmwood Reclaimed Timber

Dennis E Tuck ArchiTuckture

Precision Woods, Inc.

Ferguson Bath, Kitchen & Lighting Gallery

Anderson Windows

Got Barnwood

Factory Direct Appliance

Hayes Company

Century Roofing

JW Design Remodel

Weber Carpet

M2M Framing, LLC

MC Hardscapes

McCray Lumber

Heartland Truss

Simpson Strong-Tie

Boise/Huber

Swift Trim Carpentry

Loper Painting

Wilson Lighting

TopMaster, Inc.

RS Unlimited Landscaping

Zip Wall & Zip Roof

Home Show sponsors: Shawnee Mission Ford, Spaces, Digital Lagoon, The Aladdin, The Kansas City Star, HenHouse, Kansas City Parks & Recreation and Costco. Builders who attended the Trade Show had the opportunity to win prizes including those provided by: Dave Redlin, Progressive Environmental & Safety

Erin Schuerman, ES Photography

Mary English, Small Step Energy Solutions

Sue Sheridan, New Homes Journal

Robert Bledsoe, Cripple Creek Rock Company HBA Staff Thanks also go to Richard Holtcamp and staff from Bank of Blue Valley for their assistance with the classes held during the Home Show. Armed with the results of both exhibitor and consumer surveys, show staff is planning the 2015 Show, currently scheduled for March 20-22. Potential exhibitors and sponsors are urged to contact the HBA now to secure prime locations in the exhibit hall.

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May 2014 | Volume 20, No. 5 | www.kchba.org

Home Show attracts crowds looking for Spring to Bartle Hall

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www.kchba.org | Volume 20, No. 5 | May 2014

The HBA’s Board of Directors Endorses Dean Mon On March 28, 2014, the HBA’s Board of Directors approved a resolution endorsing Dean Mon, candidate for the National Association of Home Builders Third Vice Chairman position in 2015. The resolution highlights Dean’s Senior Life Director status and 29 years of membership and service with NAHB. It also highlights his commitment to the housing industry in his local community and in the state of New Jersey.

The Third Vice Chairman is a Senior Officer of the NAHB’s Board of Directors and helps to further the interests of the nation’s housing professionals through advocacy and education. NAHB’s Senior Officers are elected annually by the Board at NAHB’s member meetings. For more information about Dean Mon, please visit his website at www.deandelivers.com.

Home Builders Association of Greater Kansas City annual

Golf Tournament

We proudly support the home building industry.

Tuesday June 17th, 2014 Hillcrest Golf & Country Club Registration: 7:30 am • Tee-off: 8:30 am Cost: $400.00 per 4-person team

This includes entry into all events, 18 holes of golf, riding cart, lunch, and chance to win prizes! • Putting Challenge • Longest Drive • Closest to the Pin • Chipping Contest • Hole-in-One Shootout Register Team by contacting Phil Yancey @ phil@kchba.org Golf attire is required. Collared shirts. No steel spikes are allowed on the course. This year’s HBA Golf tournament offers the opportunity to enjoy a very special course: Hillcrest Country Club is one of the area’s most historical (opened in 1916) and scenic (it sits atop the highest point in Jackson County). From the opening hole, which Raymond Floyd once said was the toughest No. 1 he had ever played, to the 620 yard No. 10, still the longest hole in the city, Hillcrest provides a continual challenge to members and guests alike. Enjoy a great day with your HBA friends and a memorable round of golf!

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Home Builders Association of Greater Kansas City Annual Golf Tournament


May 2014 | Volume 20, No. 5 | www.kchba.org

Energy Efficiency – a Top Priority for Mature Market Buyers Research information featured in the previous issue of the 50+ Housing Online Magazine showed that boomers and older buyers expressed a preference for Energy Star-rated appliances and windows — as well as Energy Star-rated homes.

Share of Buyers Rating Energy Efficient Features a Top Priority by Age But that same research also shows that those two groups regarded energy-efficient features as one of their top three home-shopping priorities more often than any other age groups. The fact that today’s boomers were the same group that participated in communes, organic farms and the original Whole Earth Catalog might have something to do with their interest in using valuable energy resources more efficiently. But it’s more likely that both boomers approaching retirement and a lower monthly income, as well as elders who are even more likely to be on fixed incomes, value energy-efficient features because they moderate the effects of the rising cost of energy.

Need Help with Missouri Gas Energy Issues? Missouri Gas Energy is working hard to cut lead times for providing service to new residential construction. For assistance with delays or special situations, please contact Susan Marx at 816-360-5835 or Susan.marx@thelacledegroup.com. This is Susan’s area of focus and she will make sure the problem is resolved.

NAHB Spring Board of Directors Meeting: June 3-6 Registration is now open for NAHB’s Spring Board of Directors meeting in Washington, DC, June 3rd thru 6th. Because Congress will be in recess, this year’s event will not include the Legislative Conference. Plans are underway to hold meetings with congressional representatives at the HBA. As soon as the dates for these meetings are finalized, the information will be shared through This Week at the HBA. Spring Board will be held at the Marriott Wardman Park Hotel. For more information, visit the NAHB’s website: Home/Education& Events and enter Spring Board of Directors in the search box.

BUILD-PAC Fundraiser Set for June 18 The HBA’s Political Action Committee (HBA-PAC) is excited to announce that the next BUILD-PAC fundraiser is scheduled for the evening of Wednesday, June 18 at the home of Stan and Nancy Woodworth. BUILD-PAC, the National Association of Home Builder’s Political Action Committee, supports pro-housing candidates at the federal, state and local level. This year is particularly important as we prepare to support candidates in the upcoming November 2014 national election.

Give Your Buyers More with a Natural Gas Home

Decisions that directly impact the new home construction industry – such as overreaching or unnecessary regulation – are being made every day. Since its founding, the HBA-PAC has helped to elect hundreds of pro-housing and pro-business candidates and become more involved in the political process. These efforts are necessary to ensure that the voice of the housing industry is heard at all levels of government and that our elected officials understand the importance of new home construction for building strong communities and local economies.

Tip #1: More cost savings Natural gas water heaters cost less to operate than electric water heaters, saving the average household $200 per year on their energy bill.

Natural Gas. It’s what you’d want in your own home.

DESIGN WITH NATURAL GAS IN MIND. Natural gas furnaces, water heaters and clothes dryers offer greater efficiency and lower operating costs than their electric counterparts. Let us help you plan for natural gas right from the start. Contact Lyn Leet at Lyn.Leet@kansasgasservice.com or 913-344-8808.

The BUILD-PAC fundraiser is open to all HBA members who make voluntary contributions to the PAC. The HBA would like to thank the Woodworths for graciously opening their home for this event. To learn more about BUILD-PAC, visit www. kchba.org or www.nahb.org.

Contact MGE to learn more at 800-582-1234. 7


www.kchba.org | Volume 20, No. 5 | May 2014

Member Advantage at a Glance

When you join the Kansas City Home Builders Association, you also become a member of the National Association of Home Builders. Members of the NAHB are eligible for many discounts through the member advantage program outlined below. For more information go to www.nahb.org/ma.

Lowe’s - Members visit LowesForPros. com/NAHB or call 877.435.2440 and register to save 2% on your Lowe’s Accounts Receivable (LAR) purchases and free delivery on purchases over $500. Now Members save an additional 5% every day at the store when they mention the 5% at time of purchase and when using their LAR. General Motors - $500 exclusive private offer on most Buick, Chevrolet and GMC vehicles. Business Owners receive a $1000 private offer on select vehicles and may also qualify for additional incentives, visit nahb.org/ma and click on the GM logo to find out more. UPS Savings Program & YRC Freight - UPS discounts of up to 36% on a broad portfolio of shipping services including air letters & packages, ground shipments, international imports and exports. Savings of at least 70% on less-than-truckload shipments 150 lbs. or more with UPS Freight and YRC Freight. Please visit 1800members.com/NAHB or call

1.800.MEMBERS (1.800.636.2377) for more information. TransFirst (formerly Solveras) Complete payment solutions with proven savings of 16% per year average. Web/ mobile tools, credit card and eCheck processing, check services and more. Free “Savings Analysis” offered to NAHB members by calling 800.613.0148 or visit TransFirstAssociation.com/NAHB. Dell - Up to 30% off on top of the line Dell computers. Call 800.695.8133 and Mention NAHB or visit dell.com/nahb

Budget - Up to 20% off rental cars and FREE Budget Fastbreak at budget.com/ nahb or call 800.283.4387 and use BCD code Z536900

Canada, Mexico, the Caribbean, Europe & more. Call 877.782.9387 and Mention you are a NAHB Member at time of reservation or go to endlessvacationrentals.com/nahb

Hewlett Packard - Discounts: 9% notebooks, 5% printers/scanners, 7% handhelds, 12% workstations, 16% servers, 12% storage, 6% third party options (over 10,000 items), plus free ground shipping. To place your order call 1.888.202.4488 and mention pass code “NAHB” or visit hp.com/go/nahb

Wyndham Hotel Group - 15% off the best available rate at over 7,400 hotels, resorts. Mention ID 8000002688 at time of reservation. 877.670.7088. Go to nahb. org/ma and click on the Wyndham logo to find out more

Office Depot - 10% off all delivery orders. Free shipping on orders of $50 or more. Call 800.274.2753 mention NAHB membership or visit officedepot.com/ nahb

Liberty Mutual – Auto and Home Insurance call 1.800.531.3398 or visit libertymutual.com/nahb Hertz - Up to 20% off on rental cars and FREE Gold Plus Rewards membership. Visit hertz.com/nahb or call 800.654.2200 and use CDP# 51046.

Omaha Steaks - Save 10% off all online promotions. This discount is in addition to any online specials. OSincentives.com/ promo/nahb

Avis - Up to 25% off rental cars and FREE Avis Preferred Service membership at avis.com/nahb or call 800.331.1212 and use AWD code G572900

Endless Vacation Rentals - 25% discount on over 200,000 vacation rentals worldwide. Destinations include the US,

FTD - 20% off floral arrangements and gifts at ftd.com/nahb or call 800.SEND. FTD use code 17421 NAHB Career Center - nahb.org/careers - 20% off of standard rates for job posting & 15% off other HR services Associated Petroleum Products (APP) - Members can earn $0.015 for EVERY gallon purchased using the APP Fuel Card program. Visit associatedpetroleum.com/ nahb to enroll or call 1.800.929.5243, Option 6 & mention NAHB for more information.

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May 2014 | Volume 20, No. 5 | www.kchba.org

Member Q&A Member Q&A

Gary Kerns Owner

Erin Schuerman Owner / Photographer

Gary Kerns Homebuilders, LLC

E.S. Photography (Real Estate Photography)

Kernshomebuilders.com How did you get into your business? My grandfather and my father were both builders, so that’s really all I knew. What are the goals for your business? To continue to grow and expand my business and to stay on top of the changes that continue to happen in our industry. It’s always been a goal of mine to organize my business so that when I walk away, it can continue to function What do you like to do outside of work? Scuba dive. Ride motorcycles. Go camping Where do you like to go for fun? Mazatlán, Mexico and Palau in the South Pacific What is something people don’t know about you? That I have family in Mexico that I go see and spend time with. What is your favorite movie/television show/website? Not really into movies/ TV, but I like Adventure Rider website. What is your prediction for the home building industry? That it will continue to improve from what it was 3-4 years ago. Hopefully interest rates will stay low. What is your favorite HBA event/ meeting experience? Parade of Homes Awards Ceremony is always fun. I went to IBS this year and had a lot of fun there also. Why did you decide to join the HBA? Because it’s an organization that supports the homebuilding industry. A good place to interact with other builders in our area and exchange ideas and discuss issues.

KCMO Permit meeting.

KCMO Builders Meet to Discuss the City’s Plan Review Process

ESphotographyRealEstate.com How did you get into your business? I started my business in 2004 as a portrait photographer. My husband & I moved around the Midwest a bit, and in 2010 we were able to move back home to Kansas City. However, shopping for a new home proved to be very difficult. I found myself searching online from 200 miles away, with very little time and a tight deadline. The photos on the Internet were (for the most part) atrocious. In 2011, I reopened my photography business in KC with my focus on real estate, and I have never looked back.

Builder members who build homes in Kansas City, Missouri (KCMO) met at the HBA on April 29 to review KCMO’s list of common plan review discrepancies and to draft recommendations to improve processes and procedures in KCMO. Overall, the group is pleased about the open communication with KCMO and

What are the goals for your business? Every year, I set new goals for my business. This year, I am focusing on bringing my unique style of property videos to the KC market. What do you like to do outside of work? I am lucky because I turned a hobby into a career. Although, it can make the “OFF” switch difficult to find sometimes! Most of my spare time is spent with my husband and children. What is something people don’t know about you? Prior to starting my photography business, I was a travel consultant for 8 years. I was blessed with many opportunities to travel abroad… and spent my honeymoon on the islands of French Polynesia. What is your favorite movie/television show/website? When I have a moment to relax, I am a huge fan of TV crime dramas and pretty much anything on HGTV. Why did you decide to join the HBA? I enjoy being involved with industry-related organizations and have heard great things about HBA. I look forward to meeting more members at upcoming events. 9

believe that staff are working to meet the increase in permit applications. The HBA will submit the group’s comments to city staff and follow up with a meeting to discuss tangible solutions that could be implemented.


www.kchba.org | Volume 20, No. 5 | May 2014

Welcome New Members

Anniversaries 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. 1973 Rensen House of Lights 1975 Century Plumbing Company 1978 Complete Home Concepts, Inc. Henges Insulation and Fireplaces 1979 Holthaus Building, Inc. 1981 Geo. E Fern Company 1983 Bickimer Construction, Inc. Gene Fritzel Construction Company, Inc. 1984 Schlagel & Associates, P.A. 1986 Geiger Ready Mix Co., Inc. 1987 Reece & Nichols 1989 Extraordinary Homes 1992 Cumberland Properties, Inc. 1994 Hunt Midwest Real Estate Development, Inc. 1998 Pollard & Associates 1999 Freeman Custom Homes 2001 K C Pumpman, LLC New Homes Journal

Rmax James Reed 105 W. North Street, Alhambra, IL 62001 (314) 277-2406 www.rmax.com

RAM Metal Products Doug Kelly 6 South 59th Lane, Kansas City, MO 66102 (913) 515-6398

2003 Cecil & Ray Homes, Inc. 2005 Guier Fence Company, Inc. Premiere Marketing 2009 Harrison Baker Insulation, LLC Homoly Construction, Inc. Premier Foundations, LLC Pyramid Roofing Company, Inc. 2010 Bryant/Ratliff Builders, Inc. The Peterson Companies 2011 Chicago Title Insurance Co. Kitchens & Baths by Briggs Kline Concrete and Construction Maples Construction Co., Inc. Progressive Environmental & Safety Robertson Construction LLC SRS Design, LLC 2012 Prairie Homes, Inc. Rhino Builders, Inc. SunSource Homes, Inc. Ted’s Trash Service, Inc. Valor Construction, Inc. Williams Insulation, & Gutters 2013 Arvest Bank CoreLogic Molle Chevrolet, Inc. Pier Magic LLC TF Forming Systems, Inc. Traditional Homes

ShelfGenie of Greater Kansas City Alan Smith 10508 W 134th St, #201, Overland Park, KS 66213 (913) 730-8547 www.shelfgenie.com\kansas-city Jim’s Disposal Service 930 N Chestnut Trafficway, Kansas City, MO 64120 (816) 221-1932 www.jimsdisposal.com

Please note the address correction for: Collins/TruWood Siding & Trim Stephani Bisigano 8776 E Shea Blvd, Ste 106-109, Scottsdale, AZ 82560 (602) 568-5245 www.collinsco.com

Homedia Solutions Shawn Blancho 6445 Vista Dr, Shawnee, KS 66218 (913) 708-2284 www.homediasolutions.com

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May 2014 | Volume 20, No. 5 | www.kchba.org

Economists Agree That Housing Recovery Should Continue Courtesy of Eye on Housing, blog published 4/25/14 NAHB hosted its bi-annual Construction Forecast Webinar (CFW) on March 24, 2014. The CFW featured three industry experts. NAHB Chief Economist David Crowe was joined by Maury Harris, Chief US Economist at UBS, and NAHB Senior Economist Robert Denk to present views on the outlook for the US economy and the housing market more specifically. Here are the major points from the presentation: David Crowe, Chief Economist at NAHB, highlighted the importance of an improved economy for a continuation of the housing market recovery. Recent growth in GDP and payroll employment as well as a decline in the unemployment rate were cited as evidence of current economic strength, and these trends are expected to continue. The demand side of the housing market equation has shown signs of improvement. Consumers have expressed greater confidence and have followed up this sentiment by purchasing durable goods such as home furnishings and automobiles. Despite slightly higher interest rates, housing re-

mains affordable. Nevertheless, home increase their willingness to lend, which builders still face significant headwinds. should support job growth. He presented These include lot supply and labor avail- evidence that the easing process may have ability. Credit access has improved, but already begun; financial market measures likely hasn’t returned to normal. However, of risk are declining and lending standards these supply-side constraints should are beginning to ease. Ultimately, as the recede over time. employment situTaken together, ation improves, improving ecoespecially for “milnomic fundamenlennials”, household tals combined with formations should a more optimistic expand and pent-up consumer and an demand should be increasing need for released, resulting in new homes should greater home sales support a continuand higher home David Crowe, Chief Economist at NAHB, ing recovery in the prices. As a result of housing market. eased lending standards and an expanded capacity to lend, both the housing marMaury Harris, Chief US Economist at ket and broader economy are expected to UBS, expressed the view that a housing strengthen. market recovery and broader economic recovery will depend on the availability Robert Denk, Senior Economist at NAHB, of credit. He noted that banks currently agreed with the general consensus that the have about $2 trillion in lending capacity housing market recovery should strengthcourtesy of monetary policy, but that lend- en over the next few years, but noted that ing standards remain tight. As the risk as- the recovery will vary across the country. sociated with lending shrinks, banks will The regional variation partly reflects the

HBA Staff Sara Corless Executive Vice President scorless@kchba.org, 816-733-2216 Beatriz Ibarra Vice President of Government Affairs bibarra@kchba.org, 816-733-2237 Gina Battle Director of Parade of Homes gina@kchba.org, 816-733-2219 Marcia Jurgens Director of Administration marcia@kchba.org, 816-733-2215 Jenni Dold Director of Marketing Jenni@kchba.org, 816-942-8800 Andrew McKeegan Association Services Manager Andrew@kchba.org, 816-733-2224 Phil Yancey Membership Manager Phil@kchba.org, 816-733-2245 Dawn Allen Executive Assistant/Communication and Events dawn@kchba.org, 816-942-8800 Cara Thomas Director, Home Show cara@kchba.org, 816-733-2217

depth of each state’s housing market contraction. States where the contraction was greater will take longer to recover, while states that experienced a relatively shallow decline will recover more quickly. Second, the extent of the housing bubble, symbolized by a house price-to-income ratio, varied amongst states. States such as Florida and Nevada experienced a ratio that was double their longer-term average while states such as Wyoming and Kansas saw their ratio peak at less than 20% above their long-term average. Regional variation will also be affected by foreclosures, both the level of foreclosures and the speed of the foreclosure process. States with a larger foreclosure inventory will take longer to rebalance supply and demand and return to normal levels of production. At the same time, eliminating the foreclosure inventory is more difficult in states that have a judicial process in place to govern foreclosures. Finally, regional variation will result from the strength of each state’s underlying economy. Housing production will be better supported in states with a more robust rate of economic growth.

Dedicated to helping you put buyers into homes

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

Your goal is to turn buyers into homeowners. Our goal is to provide financing to make that happen. And, as the nation’s #1 residential mortgage lender, we provide a wide array of products and programs. So no matter what your client’s home buying goals, we can help you by providing financing options to meet nearly any homebuyer need.

May 2014 • Volume 20 • Issue 5 Copyright 2014

· · · ·

Published by the Home Builders Association of Greater Kansas City 600 E 103 Street, Kansas City, MO 64131 (816) 942-8800

Purchase loans including FHA and VA programs Mortgages for high-end purchases Investment property financing New construction and renovation loans

No other lender is as dedicated to delivering quality products and services to you and your clients as Wells Fargo Home Mortgage.

Executive Vice President Sara Corless Editor Marcia Jurgens Contributing Writer: Beatriz Ibarra Graphics Karla Peterie, Creative Services

Buyer ConnectionsSM – connects buyers and sellers not already working with a REALTOR® to professionals in their local market.

2014 Executive Committee Home Builders Association of Greater Kansas City President Chris Ragland Vice President Mark Mather Secretary/Treasurer Brenner Holland Associate Representative Kevin Kirtley Immediate Past President Fred Delibero

We’re ready to help you put buyers into homes. Contact your Wells Fargo Home Mortgage consultant today.

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

Northland Office: 816-505-4110

KC Bank Office: 913-234-7703

Lee’s Summit Office: 816-329-2109

Plaza Office: 913-402-4002

Overland Park Office: 913-319-7970

Renovation Office: 913-319-7941

Information is accurate as of date of printing and is subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2011 Wells Fargo Bank, N.A. All rights reserved. NMLSR ID 399801. AS1014405 Expires 5/2014 11


www.kchba.org | Volume 20, No. 5 | May 2014

Top 10 Hazards TELL YOUR STORY Cited by OSHA IN Promote your community or new homes to over 200,000* new home shoppers each week that read The Kansas City Star’s real estate sections either in print or online. Call for details 816-234-4739

There have been signs that OSHA is increasing its enforcement actions on home building sites throughout the country. The current OSHA administration has been clear for some time now that stepped-up enforcement is a top priority and it appears as if OSHA will remain as aggressive as ever under the new Secretary of Labor, Thomas Perez. There are a few simple things that your members should do to be prepared for OSHA inspections:

* Source: Scarborough research, August 2013

Builder Business News halfpage (10x6).indd 1

Hazard communication standard, general industry (29 CFR 1910.1200) Scaffolding, general requirements, construction (29 CFR 1926.451) Respiratory protection, general industry (29 CFR 1910.134)

Conduct appropriate safety training for employees;

Control of hazardous energy (lockout/ tagout), general industry (29 CFR 1910.147)

Understand the OSHA inspection process (see links listed). Builders and trade contractors should pay particular attention to the following

12

Fall protection, construction (29 CFR 1926.501)

Conduct an assessment to identify and correct safety hazards on the jobsite;

Update records and make sure they are readily available;

To advertise, call your account executive or Sharon Horgan at (816) 234-4739

hazards, which are the top 10 most frequently cited OSHA standards in 2013 (with the reference to the specific OSHA standard in parentheses):

Powered industrial trucks, general industry (29 CFR 1910.178) Electrical, wiring methods, components and equipment, general Continued on page 13

4/25/14 11:16 AM


May 2014 | Volume 20, No. 5 | www.kchba.org

Top 10 Hazards Cited by OSHA Easy-to-use handbooks and videos that present key safety issues builders and workers need to focus on to reduce accidents and injuries, which can be found at www.builderbooks.com/safety

Continued from page 12 industry (29 CFR 1910.305) Ladders, construction (29 CFR 1926.1053) Machines, general requirements, general industry (29 CFR 1910.212) Electrical systems design, general requirements, general industry (29 CFR 1910.303) NAHB has several resources to assist builders: NAHB’s Construction Safety & OSHA webpage, which contains compliance assistance information at www.nahb.org/ safety

Builders Development Corporation celebrated the rehab and sale of this home in Merriam, Kansas with new homeowners, Michael Snodgrass, Rep. Kevin Yoder and Commissioner Ed Eilert

The Home Builders Foundation Fund was established by the Home Builders Association in 2000. The initial fundraising was completed by 2002 and the fund was transferred to the Greater Kansas City Community Foundation (GKCCF) for administration. The Foundation Fund’s Advisory Board considers requests from housing related charitable organizations and over the past five years $67,500 has

OSHA Assistance for the Residential Construction Industry: http://www.osha. gov/SLTC/residential/index.html Contact Rob Matuga, NAHB Labor, Safety and Health Policy at 800-368-5242 Ext. 8507 for further information.

Thanks to These HBA 2014 Sponsors

Home Builders Give Back to the Community Kansas City home builders take seriously the advice to “do well by doing good” through their individual efforts, through the Home Builders Foundation Fund of Greater Kansas City and through support of Harvesters at the Home Show. During the three days of the March 2014 Home Show, donations to Harvesters of $1600 and 2200 pounds of food were collected-enough to provide nearly 10,000 meals. The HBA has partnered with Harvesters for many years by offering twofor-one tickets to the Home Show with a donation of money or food. This was the first year that the contribution could be made any of the three Show days, not just Sunday.

NAHB Webinar Replay for “How to Prepare for an OSHA Inspection” and corresponding PowerPoint presentation

Platinum sponsor

Bank of Blue Valley GOLD sponsors

Capitol Federal Bank Factory Direct Appliance First Federal Bank Henges Insulation K & E Flatwork Kansas City Star Kenny’s Tile & Flooring McCray Lumber & Millwork Nebraska Furniture Mart

been donated to a variety of organizations. The Foundation Fund has supported the Builders Development Corporation in its work to provide neighborhood revitalization and affordable housing development to multiple communities throughout the region. In support of future building professionals, the Fund has made contributions to Pittsburg State University to allow students in the School of Construction to attend the International Builders Show where they compete in the Residential Construction Management Competition. The Foundation Fund has also stepped up in times of emergency, providing donations to help rebuild Joplin, Missouri and Moore, Oklahoma after tornadoes destroyed neighborhoods. Local causes in recent years have included charities that provide basic shelter such as Drumm Farm Center for Children, Hillcrest Ministries and the Salvation Army. Contributions to the Foundation are always welcome. For information on making your tax deductible gift, call or email Marcia Jurgens, 816-942-8800 or Marcia@kchba.org.

Northcraft Flooring & Granite Owen Lumber Co. Phelps Engineering ProBuild Shamrock Cabinets Star Drywall & Insulation Sun Lumber Co. United Heating, Cooling & Plumbing Wells Fargo

Silver sponsors

Ferguson Enterprises, Inc. Stewart Title

Kansas Gas Services Missouri Gas Energy

Bronze sponsors Building Solutions Carpenters District Council Commerce Bank Complete Home Concepts Continental Title Company CrossFirst Bank 13

First American Title Hermes Landscaping James Hardie Building Products Kansas City Title Kitchens & Baths by Briggs Locks & Pulls North American Savings Bank

Pacific Mutual Door & Window Pella Products of Kansas City ProSource of Lenexa Secured Title of Kansas City Western Chandelier


www.kchba.org | Volume 20, No. 5 | May 2014

Interested in Joining a Builder 20 Club? The NAHB membership which is included with your membership in the Kansas City Home Builders Association offers many special advantages. One of those unique opportunities is the Builder 20 Clubs. These groups offer one-of-a-kind networking for top executives of companies comprised of similar builders, remodelers and other industry professionals from noncompeting markets. Each club meets twice a year to share their wisdom and learn ways to improve operations and bottom lines. Members share and compare financial information, look for trouble spots and offer each other advice on how to increase profit ratios and general performance. Statistics indicate that 20 Club members perform better than non-members in financial growth, operational systems and long-term success. Eligible participants must be NAHB members in good standing who complete at least one project per year and are the owner, principal or president of their company with at least 5% ownership in the company. The information below is from the NAHB’s introduction to the online application process. You may access this at

NAHB Home/Community/20 Clubs/How to Become a Member.

tails for your initial 20 Club meeting. In addition, you’ll gain access to the Invited Member Section on the website where you can see FAQs about the 20 Club program, Introduction to Financials (one of the biggest member benefits) and other materials to help you prepare for your first meeting.

Innovative and ambitious home builders have been taking advantage of the 20 Club program, a unique networking program, for more than 15 years. We are thrilled that you are interested in becoming a 20 Club member and ready take the next steps toward long-term success for your business.

At your first meeting, if you and the club determine that the club is a good fit, you may find yourself invited to join that club on a more permanent basis. Or you may fit best with another group.

Once you complete the online builder or remodeler application, we will submit it to each of the clubs to give them an opportunity to review your information. The packet we provide to them includes comparative data such as dollar volume, home square footage, location, units sold and market area. The information helps the clubs determine whether you would be a good fit for their group.

When deciding to join a 20 Club, first ask yourself if you would ever bounce that great $10,000 idea with your local competitor. You probably wouldn’t, but with your fellow 20 Club members, you would. Even more, your fellow members will be sharing their $10,000 ideas with you as well.

Once a club identifies you as a possible match, you will be contacted by club leadership for an interview. The interview helps them decide whether you should be invited to their next meeting. If you are invited to attend a meeting, you will be provided with an agenda and de-

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. Get notification of your events

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 14

2014 First Quarter New Home Construction Maintains 2013 Activity Level March 2014 residential permit statistics indicate a small increase over 2013 for the same quarter last year, according to the Home Builders Association of Greater Kansas City’s (HBA) monthly Residential Building Permit Statistics report. This year’s first quarter recorded 863 single family units compared to last year’s first quarter number of 832—an increase of 4%. The January through March 2014 permit count extends the trend of surpassing each year since 2007. Multi-family construction continues to see large increases over the prior five years, with 832 units permitted in the first quarter of 2014. Activity of note for the quarter is that while Johnson County accounted for 47% of total permits in the first quarter of 2013, that percentage has decreased to 36% in 2014. The Missouri counties of Clay, Jackson, Cass and Platte increased to 52% of area permits, as compared to 41% last year. The top five permitting cities year-to-date for both 2014 and 2013 are: Kansas City, Missouri, Olathe, Overland Park, Lee’s Summit and Kansas City, KS/ Wyandotte County.

Prime Office Space Available 600 E 103rd St, KCMO at I-435 & Holmes Office space is available for lease at the HBA Housing Center. This location offers a high profile to the many community and business leaders who visit the HBA. Amenities include ample parking, common area kitchen, use of large meeting room, security system and utilities. A range of floor plans and square footage is available from $24 to $30 per square foot per year. Contact Dawn at 816-942-8800 for information.


Residential Building Permit Statistics

May 2014 | Volume 20, No. 5 | www.kchba.org

Residential Building Permit Statistics

CASS COUNTY Archie Belton Cass County Cleveland Drexel Garden City Harrisonville Lake Winnebago Lee's Summit Peculiar Pleasant Hill Raymore Village of Loch Lloyd

CLAY COUNTY Clay County Excelsior Springs Gladstone Kansas City Kearney Lawson Liberty North Kansas City Pleasant Valley Smithville JACKSON COUNTY Blue Springs# Buckner Grain Valley Grandview Greenwood Independence Jackson County Kansas City Lake Lotawana Lee's Summit Oak Grove Raytown Sugar Creek PLATTE COUNTY Edgerton Kansas City Parkville Platte City Platte County Riverside Weatherby Lake Weston JOHNSON COUNTY De Soto Edgerton Fairway Gardner Johnson County Leawood Lenexa Merriam Mission Hills Olathe Overland Park Prairie Village Shawnee Spring Hill Westwood

Single Family Units^

M-F Units Sale%

M-F Units Rent

Total Units

S-F Units YTD

M-F Sale YTD

1 0 5 0 0 0 2 0 3 4 2 9 3 29

0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0 0 0 0

1 0 5 0 0 0 2 0 3 4 2 9 3 29

5 0 7 0 0 0 2 1 10 5 5 12 4 51

7 0 0 43 8 0 1 1 0 11 71

0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0

7 0 0 43 8 0 1 1 0 11 71

11 0 0 109 12 0 6 3 0 12 153

March 2014 MARCH 2014 M-F Rent YTD

Total Units YTD

0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0 0 0 0

5 0 7 0 0 0 2 1 10 5 5 12 4 51

0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 0 0

11 0 0 109 12 0 6 3 0 12 153

Single Family Units^ LEAVENWORTH COUNTY Basehor 10 Lansing 0 Leav. County 5 Leavenworth 0 Tonganoxie 5 20 WYANDOTTE COUNTY Bonner Springs Edwardsville KCK/Wyandotte Co MIAMI COUNTY Louisburg Miami County Osawatomie Paola Spring Hill

MARCH 2014

M-F Units Sale%

M-F Units Rent

Total Units

S-F Units YTD

M-F Sale YTD

M-F Rent YTD

Total Units YTD

0 0 0 0 0 0

0 0 0 0 0 0

10 0 5 0 5 20

20 0 14 1 9 44

0 0 0 0 0 0

0 0 0 0 0 0

20 0 14 1 9 44

0 1 8 9

0 0 0 0

0 0 0 0

0 1 8 9

0 1 46 47

0 0 0 0

0 0 0 0

0 1 46 47

0 6 0 0 2 8

0 0 0 0 0 0

0 0 0 0 0 0

0 6 0 0 2 8

0 11 0 0 2 13

0 0 0 0 0 0

0 0 0 0 0 0

0 11 0 0 2 13

361

0

288

649

863

0

832

1695

Comparison of Single Family Building Units for Greater Kansas City (Cass, Clay, Jackson, Platte, Johnson, Leavenworth, Miami, Wyandotte Counties)

0 0 4 1 7 5 5 6 1 33 1 0 0 63

0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0 42 0 0 0 42

0 0 4 1 7 5 5 6 1 75 1 0 0 105

38 0 22 2 9 10 11 8 2 52 3 0 0 157

0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 142 0 42 0 0 0 184

38 0 22 2 9 10 11 150 2 94 3 0 0 341

0 10 5 0 16 0 0 0 31

0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0

0 10 5 0 16 0 0 0 31

0 34 18 1 31 0 1 0 85

0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 0 0 0

0 34 18 1 31 0 1 0 85

0 0 0 3 5 4 19 0 0 55 29 1 10 4 0 130

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 246 0 0 0 0 0 0 0 0 246

0 0 0 3 5 4 265 0 0 55 29 1 10 4 0 376

0 0 0 10 6 12 40 0 0 122 80 3 33 7 0 313

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

0 0 0 0 0 0 246 0 0 0 402 0 0 0 0 648

0 0 0 10 6 12 286 0 0 122 482 3 33 7 0 961

Month/Year January February March April May June July August September October November December

2007

2008

2009

2010

2011

2012

2013

2014

Annual Total

6,385

3,232

2,155

2,471

2,301

3,299

4,090

863

353 475 824 687 677 616 546 515 397 597 385 313

221 262 353 441 231 260 311 293 264 314 167 115

96 129 131 184 189 204 196 207 219 226 192 182

137 145 252 228 213 239 180 243 173 279 173 209

90 121 180 210 230 262 204 205 202 205 185 207

188 182 270 277 294 268 288 260 379 331 283 279

273 224 335 444 337 333 409 354 384 369 340 288

283 219 361

All numbers shown in the box above are ACTUAL numbers.

Comparison of Permits By Units Issued Year to Date* 2007-2014 2007 2008 2009 2010 2011 2012 2013 2014

S-F Units 1652 836 356 534 391 640 832 863

M-F Units

180 904 11 55 0 73 129 832

Total Units

1832 1740 367 589 391 713 961 1695

^The Single Family number is units and includes both attached and detached units. %Multi-Family units are in buildings with 5 or more units and are divided by sale/rent.

# Not available at time of report

Permit information reflects the most recent data at time of publication. In order to ensure accurate recording of residential building permit statistics, the HBA may revise monthly and year-to-date figures when updated data is made available. 15


www.kchba.org | Volume 20, No. 5 | May 2014

Don’t Miss Onsite Home Construction 101 The HBA’s Sales and Marketing Council will host an event entitled Onsite Home Construction 101 on Thursday, June 12. This is a great event for anyone who wants to develop a deeper understanding of how homes are built and ask questions of a top Kansas City builder. Participants will also gain knowledge to more effectively explain the advantages of new home construction and highlight key construction features to sell a home. The homes will be at different phases of construction but within the same neighborhood in Johnson County. The presentation will cover topics from pulling a permit and other pre-building preparation to framing, electrical, plumbing and inspections. Attendees will break for a food truck lunch, which is included in the $20 fee to attend the event ($25 for nonmembers). The event begins at 10:00 a.m. and ends at 2:00 p.m. To register, please contact Andrew McKeegan at Andrew@ kchba.org or visit www.kchba.org.

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816.737.2300