Builders Outlook 2015 issue10

Builders Outlook

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National, State & Local Building Industry News 2015: Issue 10

2016: Housing Recovery to pick up steam amid challenges

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teady employment and economic growth, pent-up demand, affordable home prices and attractive mortgage rates will keep the housing market on a gradual upward trend in 2016. However, persistent headwinds related to shortages and availability of lots and labor, along with rising materials prices are impeding a more robust recovery, according to economists who participated in a National Association of Home Builders (NAHB) Fall Construction ForecastWebinar.

“This recovery is all about jobs,” said NAHB Chief Economist David Crowe. “If people can get good jobs that pay decent incomes, the housing market will continue to move forward.”

The good news, Crowe added, is that total U.S. employment of 142 million is now well above the previous peak of 138 million that occurred in 2008.

The one caveat is that job growth has been concentrated heavily in the service sector, which tends to pay lower wages than goods producing jobs.

Meanwhile, home equity has nearly doubled since 2011 and now stands at $12.5 trillion.

“The single biggest asset in most people’s portfolio is the home they own,” said Crowe. “That’s important because the primary purchasers of new homes are the sellers of existing homes. The more equity

Fall Home and Garden Show attracts thousands

The annual Fall Home and Garden show brought thousands of people into the Judson Williams Convention Center as the show kicked off October 9. The throngs of people were greeted by a very nicely presented show compliments of the producer Show Technology out of San Antonio.

The show featured a spectacular showcase home by new builder member Metro Homes. The design of the display was made to be partially constructed off site in order to meet the time lines established for the show. “I have to tell you that even with that additional time we really hustled to make sure we had a great product to show,” said Fernando Torres of CTU Metro Homes. Beautiful and elegantly staged the house became the favorite of the show winning Best of Show for the efforts. “We are excited to be able to show off our models to the public and to the real estate agents because we’re new to the market and we think we have a very good product to offer the consumer,” Torres continued.

they have, the more comfortable they feel about purchasing a new home.”

And while mortgage interest rates are expected to rise over the near-term, averaging 4.5 percent in 2016 and 5.5 percent in 2017, Crowe said this is not expected to have an impact on the housing recovery. “As the economy gets better, job and wage growth should keep pace. So even though mortgage rates will rise, they will still be low by historical standards and very affordable.”

Supply Headwinds Crowe noted several factors that are hindering a more robust recovery. Citing an NAHB survey of its members, 13 percent of builders reported the cost and availability of labor was a significant problem in 2011 and that concern jumped to 61 percent in 2014.

About one-fifth of builders shared the No doubt that the home brought together ideas that really made the showcase home that much more interesting. The process of actually piecing the walls together, setting up the floor and the all that goes on a wall or in the ceiling is not something for the faint hearted. “We were asked by Habitat for Humanity to donate what we could from this build, and I’m proud that we could,” Torres told the Outlook. The rest of the showcase was quickly taken to a lot waiting for some of the frame and other parts that could be used so to not go to waste. Overall a very beautiful green showcase home that will continue to give for years to come.

The Fall Home and Garden was the only show of its kind this year since the civic center was taken over for the Men’s Bowling Championship (ABC). The civic center turned into a large bowling alley complete with state of the art lanes. “We run into situations like this when the civic center or halls we use are the only ones that can fit our shows,” said Tommy Mantini of Show Technology. “We have to be flexible but then again I know that this year we would have pent up demand and it showed during this event.”

What impressed many was the carpeted aisles and the amount of room to comfortably move around. “I thought this was one of the nicest shows we’ve had in

same concerns regarding lots in 2011 and that ratio shot up to 58 percent in 2014.

Concerns over building materials stood at 58 percent among builders in 2014, up from 33 percent in 2011.

some time,” said Associates Chairman Sam Shallenberger. “We had new displays and exhibitors and that was a nice thing to have.”

The presenting attraction was the Wall Wizard, Brian Santos who did several demonstrations during the three day event.

“I really love coming to El Paso and seeing so many folks for the first time,” Brian told the Outlook. “The El Paso Association of Builders has helped me get other gigs with other associations and I’m grateful for the recommendation,” he continued. Santos, who has authored several “how to” books and is an inventor and innovator for several companies including Home Depot. “My relationship with Rubber Maid and Home Depot and Lowes is really a great thing to

Single-Family Continues to Post Gains Turning to the forecast, NAHB is projecting 719,000 single-family starts in 2015, up 11 percent from the 647,000 units produced last year. Single-family production is projected to increase an additional 27 percent in 2016 to 914,000 units.

On the multifamily side, production ran at 354,000 units last year, slightly above the 331,000 level that is considered a normal level of production. Multifamily starts are expected to rise 9 percent to 387,000 units this year and post a modest 3 percent decline to 378,000 units in 2016.

Residential remodeling activity is forecasted to increase 6.8 percent in 2015 over last year and rise an additional 6.1 percent in 2016.

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bring to the consumer because I know what’s hot in the world of walls,” Santos said.

Our sincere thanks to CTU Metro Homes and all the suppliers and the staff of David Acosta Real Estate. We also owe a debt of gratitude to the exhibitors who filled the civic center with good products and lots of things for the visitor to see. Our Spring Home and Garden Show is on for March 11-13, 2016. Don’t miss this opportunity to reach potential customers. Visit Show Technology today at www.showtechnology.com to get information on the Spring show.

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Builders Outlook

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2015 issue 10

2015 issue 10

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Builders Outlook

President’s Message Edgar Montiel

President, El Paso Association of Builders

Can you believe that Christmas decorations are hitting the home improvement store’s shelves already and Halloween is still not here? In any case, I hope that each of you is doing amazingly well! I enjoy writing these articles because it gives me the opportunity to reflect on everything that the association has done in the last thirty days. As most of you know, assessments are a large part of the association’s income and they are primarily calculated on the total dollar value of permits pulled. In recent years, as builders have moved construction outside of the city limits, it has become harder to determine the total dollar

Home Stretch: 2014 Winding down value of permits thus impacting the EPAB’s bottom line.

At our last board meeting, held October 14th, a change to the bylaws was approved that will provide the association with the flexibility to determine assessments by different means. The current thought is that assessments will be calculated based on a builder’s prior year total. The other nice thing is that they will be billed one time yearly versus quarterly. This too will help with budgeting and projecting income more appropriately. The Bylaws change is the first step in this transition and details will be sent out to everyone as they are approved by the BOD. I would like to thank Mr. John Balliew, President and CEO of the EPWU, for being our guest speaker at our last General Meeting. He presented some very interesting information on long term water supply for our region. He also showed us how we have some of

El Paso & So outhern New Mexico

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the lowest water utility pricing in the state. Austin leads the state in cost and is currently the least affordable. I would also like to thank our General Meeting sponsor Michael Elman of 2-10 Home Buyer’s Warranty.

I would like to congratulate Kathy Parry of HUNT Companies as she has accepted her nomination for the EPAB Leadership Ladder. I, like many of you, believe that she will do an amazing job and is absolutely up for the challenge.

I can tell you first hand that the next three years will be amazing for the association. I know that Carlos Villalobos will do an outstanding job as President next year as will Don Rassette during his term. Our board has done an outstanding job of finding amazing people to be on the Ladder.

We had our first meeting with the City of El Paso to review the 2015 code that will be implemented in September 2016. Builders please note that the changes to the building part of the

code are relatively simple and the Electrical Code will be a little more demanding as there are new AFCI and GFCI requirements. However, the jury is still out on the Energy Code.

The association will be hosting an Energy Code review in November.

Seating is limited and builders are encouraged to attend, ask questions, and provide feedback. I have heard from many builders that are expecting an increase in construction costs in the thousands of dollars which will directly impact affordability especially in our region. Call the association for more details on the meeting. Upcoming events include the Golf Pro AM, EPAB installation dinner on December 11th, and the Spring Parade of Homes in Enchanted Hills in March of 2016. In closing, I hope everyone had a safe Halloween and I wish you a positive end to 2015.

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Builders Outlook

President’s Message Ray Adauto, Executive Vice President EPAB The issues continue to grow and the ability to tackle them harder and harder to do. The EPAB has been involved with the workings at the City of El Paso, the PSB and other agencies that affect what our builders, and therefore our associates, can do. In the coming weeks the association will be involved in two important code discussions, the International Residential Code and the Energy Codes. Every few years there is a group that gathers to formulate what the codes should be for buildings, development and other building related things. We concern ourselves mostly with residential code because that is what we are charged with as a home builder association. Codes tell the government entity what you are supposed to have in a residence in order to comply with “health and safety” of that residence. For

2015 issue 10

Getting ready for 2015 IRC and Energy Code requires involvement

instance the code can call for specific insulation, including types and amount. It can tell you what materials are approved for construction such as stucco, vinyl siding, rock, brick, or other materials.

There’s even a code for how much hay to put into the mud to make adobe bricks, something that the indigenous peoples knew by trial and error. There are versions that a government entity “adopts” meaning that the selected code is enforced by that subdivision. El Paso will get the 2015 IRC implemented in September 2016. Why so late?

Frankly because there’s a learning curve and an application curve to each version of the IRC. Our builders have to start complying with the selected code and that means the vendors and suppliers must stock the upgraded or new materials required by the code. The inspectors need to be trained to the new code and then hopefully so will the architects and engineers, plan reviewers and all the support personnel. It’s a big task but in the end it’s the builder who’s stuck with making sure the home passes inspection and gets the certificate of occupancy.

The same hold true for the Energy

Code and to that the State of Texas determines that code so that every subdivision in the state must conform to it. Training for that is coming up in mid-November with the City of El Paso. Residential will take place one day, commercial the next.

It’s complicated and sometimes annoying but it’s the law and by this time it’s just that, something builders have to comply with. The Energy Code impacts things like windows, insulation, HVAC and other things.

All those new air conditioning units must hit a specific HERS rating or it can’t be installed. Imagine the

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impact these two new codes will have. That’s why we work so hard to make sure the codes and rules don’t put a member out of business, sometimes the unintended consequence of the laws. Thanks to member volunteers our input is taken and many times we influence the outcome.

So as we near Halloween and get ready for Turkey Day just remember that the association and its members are busy making sure once again that new home construction is viable in El Paso and surrounding communities.

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2015 issue 10

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Builders Outlook

National Builder News Multifamily Gains Push Housing Starts Up 6.5 Percent

n Led by a jump in multifamily production, nationwide housing starts increased 6.5 percent to a seasonally adjusted annual rate of 1.206 million units in September from an upwardly revised August reading, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department. Multifamily starts rose 18.3 percent to a seasonally adjusted annual rate of 466,000 units while single-family production edged up 0.3 percent to 740,000 units.

Although our builders are gaining confidence in the housing market, they remain cautious about adding too much inventory,” said NAHB Chairman Tom Woods, a home builder from Blue Springs, Mo. “Despite the modest month-over-month differentials in single-family production, this sector has shown gradual improvement throughout 2015,” said NAHB Chief Economist David Crowe. “Since January, single-family starts are up 11 percent and we anticipate a similar pace for the rest of this year.”

Combined single- and multifamily starts rose in three of the four regions in September. The Northeast, South and West posted respective

gains of 23.4 percent, 0.6 percent and 25.4 percent. The Midwest registered a 12.2 percent loss.

Single-family permits edged down 0.3 percent to a rate of 697,000 while multifamily permits fell 12.1 percent to 406,000.

Regionally, the Midwest, South and West posted respective permit losses of 5.1 percent, 6.8 percent and 6.2 percent. The Northeast rose 8.3 percent.

Remodeling Market Posts Tenth Straight Positve Quarter

n The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 57 in the third quarter of 2015, two points below the previous quarter. However, this is the tenth straight quarter it has been above the key break-even point of 50.

An RMI above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it is lower. The overall RMI averages ratings of current remodeling activity with indicators of future remodeling activity. The RMI was 64 in the Northeast, 58 in the Midwest, 56 in the South and 61 in the West.

“The sustained confidence of remodelers shows that the remodeling market is gradually strengthening in what has been a longer than

BUILDING

anticipated recovery,” said NAHB Remodelers Chair Robert Criner, GMR, GMB, CAPS, a remodeler from Newport News, Va. “Smaller jobs remain more popular, but overall remodelers feel positive about the future of the industry.”

At 58, the RMI’s future market conditions index was unchanged from the previous quarter.

Among its four components, backlog of jobs rose to 60 from 58 while calls for bids and appointments for proposals—at 57 and 58, respectively—each dropped three points from the previous quarter’s readings. The amount of work committed for the next three months held steady from the previous quarter at 55.

The current market conditions index declined three points to 56 this quarter. Among its components, major additions and alterations, the slowest-recovering component, fell to 52 from 57 in the previous quarter. The smaller remodeling projects and home maintenance and repair components of the RMI decreased four and two points to 57 and 58, respectively.

“An RMI above 50 indicates that remodelers still feel positive about the market on balance, and it is an indication of the housing recovery that this quarter’s RMI reading is the tenth straight quarter in positive territory,” said NAHB Chief Economist David Crowe. “The increased backlog of remodeling jobs highlights the continuing labor shortages that hinder production, especially of large additions and alterations, and make it difficult to complete projects in a timely manner.”

More information: nahb.org/remodel.

El Pa aso

New-Home Sales Drop 11.5 Percent

n Sales of newly built, single-family homes fell 11.5 percent to a seasonally adjusted annual rate of 468,000 units in September, according to newly released data from HUD and the U.S. Census Bureau.

“Despite this monthly drop, our members continue to tell us that housing is moving in the right direction,” said Tom Woods, chairman of the National Association of Home Builders (NAHB) and a home builder from Blue Springs, Mo. “Consumers may have simply been reacting to soft job numbers.”

“It is not surprising to see sales pull back in September following a strong August reading, especially after a few months of weak job creation,” said NAHB Chief Economist David Crowe. “However, new-home sales year-to-date are up 17.6 percent compared to the same period of 2014, and we expect the market to continue improving at a gradual but steady pace for the rest of year.”

Regionally, new-home sales were down across the board. Sales fell 61.8 percent in the Northeast, 8.3 percent in the Midwest, 8.7 percent in the South and 6.7 percent in the West.

The inventory of new homes for sale was 225,000 units in September. This is a 5.8-month supply at the current sales pace.

SINCE 1950

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Builders Outlook

Economic Outlook Elliot Eisenberg Economic & Policy Blog

With our economy growing slowly for nearly a decade, it’s time to promote policies that will spur growth. While there are always the obvious ones such as reducing government regulation, improving K-12 education and offering investment tax credits to firms, the first two are at best long-term reclamation projects while the latter costs money, which is in short supply.

Below are five suggestions, each of which costs little to no money, and collectively they can boost annual GDP growth by 20% to 25%/year or $80 billion annually.

Continued from

Front Page:

Improving GDP Growth Begin by lowering the US corporate tax rate of 35% closer to the average developed world rate of 20%. Our high rate pushes firms to exploit loopholes, encourages firms to keep foreign earnings abroad and promotes corporate inversions and foreign takeovers of US firms. Worse, it brings in little revenue. A lower rate would attract investment from abroad, boosting productivity. At the same time simplify the personal income tax system. It is complicated, unfair and inefficient. At a minimum reduce marginal rates, widen the tax base and rid the code of some deductions. Plenty of studies show how this can be done while remaining revenue neutral.

Next, pass trade reform. At present, US exporters face an average tariff rate of close to 7% and more importantly, a host of non-tariff barriers. As the world’s leader in services exports such as banking, insurance, music, movies and agricultural exports, increased trade is critical to growth. Moreover, the US generally has

lower trade barriers than most other nations, so elimination of trade barriers is additionally beneficial. And due to the size and wealth of our market, other nations will be willing to make trade deals to get better access to it.

Something else to do; provide the Highway Trust Fund with a permanent source of sufficient revenue so that it is not perpetually in need of emergency monies from the general fund to remain solvent.

Ideally raising the fuel tax, last increased to 18.4 cents/gallon in 1993, to eliminate this problem would be best, but nearly any source of dedicated revenue will do. As it is, we systematically underinvest in roads, bridges, tunnels and airports, yet these are precisely what establish conditions for longrun growth. Skimping on infrastructure is penny wise and pound foolish.

Reduce the number of professions where licensing is required. Over the past 40 years the number of professions that require licensing has risen from 10% to almost 30%. Licensing hits the poor

Suburbs are Still Hot Looking at home buyer preferences, Trulia Housing Economist Ralph McLaughlin said that contrary to popular belief, millennials prefer to own a home in the suburbs rather than rent in the cities. “Many believe that home buyers are bucking the trend of previous generations in that they want to live in urban areas and

want to rent,� said McLaughlin. “What we are finding from our surveys is just the opposite. Among millennial renters, almost 90 percent say they eventually want to purchase a home. That is significantly higher than Gen Xers, who were hurt by the recession, and quite a bit more than current baby boomer renters, who are at 40 percent.�

However, an overwhelming majority of millennials, who are still starting households and paying off college debt, say it will be at least two years before they are ready to buy.

Roughly half of all Americans prefer to live in suburban areas, about a quarter prefer urban areas and just over 20 percent prefer rural communities, according to a Trulia survey conducted last November. “As we get into the recovery, suburban areas are growing faster than urban areas,� said McLaughlin. “That is a sign that the urbanization trend we saw start to happen at the beginning of the recovery was more of a blip rather than a new rule.�

Moreover, the percentage of households living in urban neighborhoods in 2013 was lower among nearly all age groups compared to 2000. “So again, this shows there really isn’t an urbanization trend among households,� said McLaughlin.

Over the past five years, the share of searches on Trulia in suburban-urban zip code areas has held fairly constant, at roughly a four-to-one-ratio for suburban searches. “Home buyers are saying they prefer modern and modest sized homes in the suburbs with amenities,� he said, adding that 44 percent of Americans say they want to live in a house between 1,400 and 2,600 square feet.

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Recovery in All Regions, but Pace Varies Delving below the national numbers, NAHB Senior Economist Robert Denk said that housing market conditions are improving in all regions, but the pace of recovery continues to vary by state and region. “We’ve gotten to the point in the recovery where we no longer have problems that came with the housing bust,� said Denk. “It now is really a matter of housing markets reconnecting to the fundamental drivers, and that is employment. Production has been rebounding in all regions, prices have been moving up and new foreclosures are back to more normal levels.�

Using the 2000-2003 period as a healthy

hardest and erects barriers to entry for the less educated. For health and safety reasons sure, but 163 days of training for a manicurist in Alabama - that’s clearly overkill.

Last but not least, get on with immigration reform! At a minimum, pass limited legislation where both parties are in agreement. Increase the number of H-1B visas that admit skilled foreigners. This will not depress wages of union workers and will increase the flow of human capital here. The more talent we attract, the faster we grow. We are engaged in competition with other nations such as Canada, Britain, Germany and Australia for the most talented. There is no reason for us to be turning away highly educated individuals who wish to live here.

Elliot Eisenberg, Ph.D. is President of GraphsandLaughs, LLC and can be reached at Elliot@graphsandlaughs.net.

His daily 70 word economics and policy blog can be seen at www.econ70.com.

Home buyers are saying they prefer modern and modest sized homes in the suburbs with amenities,� he said, adding that 44 percent of Americans say they want to live in a house between 1,400 and 2,600 square feet. benchmark when single-family starts averaged 1.3 million units on an annual basis, NAHB is projecting that single-family production, which bottomed out at an average 27 percent of normal production in early 2009, will rise to 74 percent of normal by the fourth quarter of 2016 and climb to 91 percent of normal by the end of 2017.

Single-family production currently stands at 53% of normal activity.

The hardest hit areas during the downturn were a combination of the bubble states – California, Arizona, Nevada and Florida – and the industrial Midwest. The bubble states had the most excessive price and production spikes, while the problems in the Midwest were more related to fundamental economic weakness.

The most successful recoveries are happening now in the energy states, including North Dakota, Wyoming, Texas, Montana and Louisiana.

Other states exhibiting strong employment and housing growth include South Carolina, Utah, Tennessee, Idaho, Oregon and North Carolina.

In another way of looking at the long road back to normal, by the end of 2017, the top 40 percent of states will be back to 99 percent or more of normal production levels, compared to the bottom 20 percent, which will still be below 73 percent. “Keep in mind that with all of these buckets, the numbers keep getting higher,� said Denk. “There is broad-based improvement across the country.�

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Builders Outlook

Festival of Homes October 2015

Builders Outlook On the Scene

Festival of Homes showcases eastside builders The Festival of Homes opened on October 10 as seven builder members and one nonmember displayed their new creations on the far eastside. The subdivision is located off of Pebble Hills and Mike Price in a new subdivision by Southwest Land Development.

Participating member builders were Icon Custom Homes, BIC Homes, Palo Verde Homes, Edward’s

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Homes, Bella Vista Homes.

Fortune Custom Homes and GMF Homes. Trinity Homes was also in the show. “We had a good show with a nice attendance and more importantly some sales before we closed the show,” said Frank Torres, chairman of the Festival.

The show ended a successful 14 day run October 25.

Buildeers Outlook On the Scene

Fall Home & Garden Show October 2015

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Builders Outlook

Construction loans are typically short term with a maximum of one year, and have variable rates that move up and down with the prime rate.

The rates on this type of loan are higher than rates on permanent mortgage loans.

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Construction loans for new-built homes are either obtained by the homebuilder or prospective owner. In pre-recession days, small builders had greater access to capital but now must frequently put the onus on the buyer to obtain the loan. That's one reason most new homes rising today are simply "specs" built by big, high-credit corporate conglomerates.

The basics of construction loans Let's proceed on the assumption that you're taking out an individual construction loan. Such loans, which can be tough to get without a previous banking history because of the lack of collateral (a finished home), have special guidelines and include monitoring to ensure timely completion so your repayment can begin promptly.

Construction loans are typically short term with a maximum of one year, and have variable rates that move up and down with the prime rate. The rates on this type of loan are higher than rates on permanent mortgage loans. To gain approval, the lender will need to see a construction timetable, detailed plans and a realistic budget, sometimes called the "story" behind the loan.

Construction of new home Once approved, the borrower will be put on a bank-draft, or draw, schedule that follows the project's construction stages and will typically be expected to make only interest payments during construction. As funds are requested, the lender will usually send someone to check on the job's progress.

Construction-to-permanent arrangement Upon completion, which is defined by a certificate-of-occupancy issuance and full payment of contractors (and often their signatures on lien releases), the borrower's loan liability will typically roll over into a mortgage, ideally in an arrangement where the borrower pays closing costs only once. Of late, lenders have been combining the two into a single 30-year loan with one closing, called construction-topermanent financing. Because of the bank's greater loan-to-value risks in these, I might add, be prepared to put a little more skin in the game: The lender may offer only 80 percent of project costs or even less. If you already own the land, that can serve as equity.

Construction delays due to weather and material/labor availability are fairly common. Be sure to build some allowances for this into the construction timetable.

They're a small part of the market Why is there so little information or competing lender offers on construction loans online? For starters, those loans represent only a very small percentage of home loans. Plus, they're a bigger risk. Hence, such

financing isn't the type of thing lenders aggressively market online; you have to hit the streets for it. Regional banks and credit unions are typically the best sources.

Without impeccable credit or a strong existing lender relationship, you may be challenged to find an affordable construction loan in today's lending climate, though a booming local housing market and substantial family income tend to grease approvals.

Read more: http://www.bankrate.com/finance/realestate/how-do-home-constructionloans-work.aspx#ixzz3poAjkdKN Follow us: @Bankrate on Twitter | Bankrate on Facebook

S. Re sler D

By Steve McLinden • Bankrate.com

How do home construction loans work?

S. Re sler D

Finance

2015 issue 10

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2015 issue 10

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Builders Outlook

Trends Kitchen

By Jacob Hurwith

Kitchen cabinet trends have not changed as much as other areas around the kitchen, such as kitchen countertops, but a few dominant trends have taken shape in 2015. Fortunately enough, many experts agree that most of the kitchen cabinet trends discussed below are not going away in 2016.

Personalized Cabinets First and foremost, despite any of these trends, many homeowners are adding cabinet styles, colors and functions that fit their needs and desires. As time has evolved, cabinet companies have come up with numerous styles that match any home design or style. As a result, even homeowners who can afford them are passing over custom cabinets for more affordable, yet design-friendly, semi-custom cabinets.

Overall, in today’s world, there is no cookie-cutter kitchen cabinet design. Ask any kitchen expert for hot designs and they will almost certainly say that personalization and tailored designs are sticking around through 2015, into 2016.

Clean Lines & Subtle Design Two other dominant trends for kitchen cabinets are clean lines and subtle designs. To ensure design flexibility in the long term, cabinet door styles have become simpler, using clean lines. As the modern style continues to gain steam, clean lines and subtle designs make ideal sense for anyone looking to upgrade their kitchen cabinets.

Matching another kitchen remodeling trend, clean lines go perfectly with black and white kitchens. As I noted in Kitchen Remodeling Trends For 2015-16, black and white kitchens tend to offset each other and give the kitchen a clean, sleek and visually appealing design. Clean lines, along with black and white kitchens, can also offset the tension between rustic, modern and transitional kitchens.

Shaker Cabinets Along with the classic black and white, shaker style cabinets have remained in vogue for years. At first glance, some associate shaker as a plain, square design that doesn’t leave much room for

7 Kitchen Cabinet Trends to Watch In 2016 imagination. However, many more attractive versions of the shaker have come to life since the 1800’s.

One way to install terrific shaker cabinets is by using premium quality wood. With its simple design, shaker cabinets let the wood or material do the talking. Just like a knife does the work when you’re cutting an onion, the wood tends to speak the loudest when it comes to shaker cabinets.

Just how prevalent are shaker cabinets?

“Ninety-nine percent of the time, it’s a white painted-wood shaker door with a square picture and simple recessed center,” Anthony Maucieri, president of East Hill Cabinetry said.

White Cabinets Along with the clean line theme, white kitchen cabinets are still quite popular, as you saw above, but gray, along with other neutral colors have began to set up shop.

Many homeowners are opting for refined neutral colors and earthy tones that work well with a variety of design elements.

These colors not only provide a sense of warmth, but give you more design freedom to add bold colors elsewhere, providing a seamless blend throughout the house.

If you don’t want to replace your kitchen cabinets, but want to add a different pop of color, try painting. We even outlined the Best Way To Paint Kitchen Cabinets.

Functional Design Every aspect of the home needs to casually blend function and design. One should never have to sacrifice one for the other, especially with today’s design improvements across the home. Luckily, kitchen cabinet designers have taken this to heart and created kitchen cabinets that not only look beautiful, but accommodate your needs for better storage, organization and access.

As we noted in 9 Secret Places That Can Add Storage To Your Small Kitchen, smart homeowners are utilizing every inch of space when it comes to their kitchen cabinets. Don’t neglect the space above your cabinets, below your cabinets, between your cabinets or in those tight corners. A few ways to employ some of these spaces are: • Install a toe-kick drawer under your lower cabinets.

• Add containers or extra drawers above your upper cabinets.

• Install pullout shelving.

• Install a Lazy Susan in your corner cabinet (helps with your back).

We could all use more kitchen storage and these four ideas ensure that not matter what size your kitchen may be, no item will be left behind.

Horizontal Cabinets Squares and vertical rectangles are still the preferred designs for kitchen cabinets, but according to Masterbrand Cabinets, Inc., there is a rise in horizontal cabinetry. As cabinets get wider, there is less of a need to stack cabinets (if you have enough storage). This not only makes access much easier, but gives your kitchen a cleaner, more refined look.

If you’re looking for more organization, you can also add drawer inserts to declutter all those pots, pans and numerous other kitchen utensils you have.

High-Tech Cabinet Options We live in a new world where we are always connected and kitchen designers have taken that to heart. As a result, many homeowners are adding a tech perspective to their kitchen cabinets such as built-in charging stations, hands-free functionality and tablet holders. These additions, along with other innovative kitchen additions, have made living in the 21st century that much easier.

Conclusion Trends are trends because more and more people agree it is the right way to go.

However, as I pointed out before, personalized cabinets and kitchens will never go away. One must feel comfortable in your own kitchen and as such, install kitchen cabinets that feel right to you and only you.

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12

Builders Outlook

Trends

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Kitchen

By Kristin Whalen good invention can solve a problem you didn’t realize you had.

Kitchen appliances are a big part of your renovation investment, so it’s important to be completely aware of features and products out there that will make your life easier. Say hello to these appliance developments that have caught our eye!

WeMo Coffee Maker Let me start by saying that I rely heavily on my morning cup of coffee, my afternoon cup of coffee and on occasion, my evening cup of coffee. We coffee lovers have the Dunkin Donuts and Starbucks locations around us all mapped out, but we are constantly trying to reproduce the same quality coffee at home without adding additional time to our daily routines. The Mr. Coffee 10-Cup Smart Optimal Brew Coffeemaker with WeMo is the coffee maker I’ve dreamed about. This Wi-Fi enabled coffeemaker (just plug it in and download the free app) will allow you to brew coffee without getting out of bed. When your coffee is done brewing, your smartphone receives an alert telling you your coffee is ready.

And if you feel like hitting the snooze button, the stainless-steel thermal carafe also keeps your coffee hot for over two hours! In addition, Optimal Brew™

2015 issue 10

Innovative Kitchen Appliances Technology heats water up to 205°F, which is the optimal temperature for bringing out the best flavors in your cup.

If you love the convenience of this technology as much as I do, be sure to check out the Wemo crockpot, making dinners easy as can be, from anywhere.

Bottle Wash Jet Dishwasher GE appliances have been known to simplify routines by answering real-life needs. There are certain items that my dishwasher can never seem to get clean, and bottles (especially narrow neck) are on the top of this list. I often feel like I spend more time cleaning bottles than I do actually using them. Thanks to GE, their new dishwasher features the industry’s first bottle wash jets that direct water deep inside to clean even the most hard to reach areas. Say goodbye to hand washing for good! As if this wasn’t impressive enough, GEs stainless steel dishwashers are also extremely quiet, and feature a full extension third rack to easily clean your flatware. We have never been more excited to wash dishes!

SodaStream Refrigerator Samsung's innovative and top quality appliances can be recognized worldwide.

They have introduced the industry’s firstever sparkling water dispenser powered

by SodaStream, all at the touch of a button! Samsung allows a standard SodaStream cylinder to tuck away inside the left refrigerator door. It is easy to access when the time comes for replacement. You can even customize the level of carbonation you would like.

Samsung really thinks of it all; not only will this save interior storage space; this will also reduce bottle waste in your home. You will also save trips to the grocery store as you can store up to 29 bags of groceries inside! Now that’s cool.

French Door Wall Oven Viking Professional ovens have been known to deliver total convenience and superior power, and their new French door wall oven is no exception. Not only will this wall oven compliment the style of your French door refrigerator, but it is

extremely user friendly. You can open up both doors with one hand! The extralarge interior (4.7 cu. ft.), makes it the largest oven in the industry. Thanksgiving will be a breeze! Additional features we love include: super-fast preheating, heavy-duty metal knobs accented with LED lights and 11 different cooking modes. To top it all off, it’s available in a multitude of exclusive finishes such as apple red, graphite grey, cobalt blue and more!

Subzero Wine Have you ever dreamed of storing wine in your kitchen, but didn’t think you would have the space? Think again! Our friends at Subzero have launched a compact wine storage unit. At just 15” wide and 34” high, it will fit beautifully underneath your kitchen counter. It features a bronze-tinted UV-resistant glass, which prevents light exposure to keep your wine at its best quality. With both stainless steel and panel-ready models, you can really customize the look to fit into your new kitchen. To keep your wine flavors unharmed, the unit is temperature controlled from 45°F to 55°F and also moisture controlled to prevent dry corks.

This small but mighty unit can store up to 26 bottles of your favorite vino – Cheers!

Source: www.improvenet.com/a/innovativekitchen-appliances

2015 Issue 10

Association News & Events

UPCOMING EVENTS NOVEMBER 5 CONTRACTS CLASS EPAB 11:00-2:00 NOVEMBER 9 PRO-AM GOLF TOURNAMENT CORONADO COUNTRY CLUB NOVEMBER 10-13 TAB MEETING AUSTIN, TX DECEMBER 11 INSTALLATION MARRIOTT HOTEL

13

Builders Outlook Make your travel arrangements now for the 2016 International Builders Show in Las Vegas.

Jan 19-21

NEW AMERICAN FUNDING CONTACT: CANDI LOPEZ 444 EXECUTIVE CENTER BLVD., STE. 100 EL PASO, TX 79912 915-443-1119

NEW MEMBERS SILVER SPRINGS POOL & SPA CONTACT: AMY VOLLMER 5472 LA ESTANCIA CIRCLE EL PASO, TX 79932 915-875-0290 DEAL-2-DEAL HOMES CONCTACT: DELTON DEAL 6316 FRANKLIN DESERT DRIVE EL PASO, TX 79912 915-217-9233

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Connect to the El Paso Association of Builders: www.elpasobuilders.com

ted escobedo

ted@snappypublishing•com talk & text: 915•820•2800 Get Creative. Make it Snappy.

El Paso Desert Open Pro Am Meet the Pro’s Come out and see the area’s finest club pro’s in action at the El Paso Desert Open Pro Am November 9 at Coronado Country Club.

Club pros from West Texas and New Mexico competing for the Sun Country PGA championship along with 54 amateur players. This exciting high stakes event is the final EPAB golf tournament of the year!”

Monday, November 9.

Shotgun 10 am.

Presented by

14

Builders Outlook

Associates Council

Sam Shallenberger Morrison Supply

Hello everyone! I hope everyone is doing good and planning a happy Halloween. This year has gone by faster than the past four or five years.

The old adage time really flies when you are having fun is so true. It seems just like yesterday we were kicking off the year and getting ready for the Parade of Homes and our famous Golf Pechanga.

I would like to thank the Associates that have helped with all of the events that the Association has had this year.

I would really to thank all the MEMBERS that have contributed sponsorships for the events that we have had this year. Without the help of all of you that stepped up and gave your time and money we would have struggled to say the least. Over my four years of being Associates Chair I have enjoyed the challenge of helping the association during some good times and some not so good times so remember you get out of the association what you put into the

2015 issue 10

association.

The last two months of the year are upon us so I hope everyone is having a great year and has a strong finish.

Please make sure to mark your calendars for the Installation banquet December 11 at the Marriott on Airway. It’s always a good time. I’ll be saying my goodbye as Associates Chair but I will continue to help the Association for as long as I can.

Thanks, see you at some event for the Association.

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Builders Outlook

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2015

El Paso Disposal

Issue 10

772-7495 6046 Surety Dr. El Paso, TX 79905 915-778-5387 • Fax: 915-772-3038

■ EXECUTIVE OFFICERS Edgar Montiel, President Palo Verde Homes

Carlos Villalobos, Vice President Pointe Homes Don Rassette, Secretary/Treasurer Rassette Homes Sam Shallenberger, Associates Chair Morrison Supply

■ NATIONAL DIRECTORS

Bobby Bowling IV.

Demetrio Jimenez NATIONAL ASSOCIATION OF HOME BUILDERS (800) 368-5242

TEXAS ASSOCIATION OF BUILDERS

(800)252-3625

Frank Torres, Immediate Past President GMF Homes Ray Adauto, Executive Vice President Executive Vice President Jay Kerr -Attorney of Record Firth, Johnston, Bunn & Kerr ■ COUNCIL/COMMITTEE CHAIRS

Associates Council Sam Shallenberger Build Pac Randy Bowling Land Use Council Linda Troncoso

Young Designer Award John Chaney Remodelers Council Rudy Guel Membership Retentiion Patrick Tuttle Finance Committee Kathy Carrillo Henry Tinajero

■ ADVISORY TO THE BOARD

Jay Kerr, Firth, Johnston, Bunn & Kerr James Martinez, Law Office of James Martinez ■ BOARD OF DIRECTORS

Antonio Cervantes, BIC Homes

Bret Thompson, Foxworth Galbraith Lumber

Bud Foster, Southwest Land Development Servises Dan Ruth, Millienium Homes

Henry Tinajero, West Star Bank

Joe Bernal, Employer Benefits Of El Paso John Chaney, Passage Supply John Dorney, Dorney Security Kathy Carrillo, Pioneer Bank

Kathy Parry, Hunt Companies

Leti Navarette, Custom Dream Homes Linda Troncoso, TRE & Associates Robert Najera, Joseph Homes Walter Lujan, Dawco Builders

■ TAB STATE DIRECTORS

Randy Bowling Greg Bowling

Sam Shallenberger

For All Your Electrical Needs Residential Specialists Tract Homes • Custom Homes

2014 Builder Member Of The Year Frank Torres GMF Homes 2014 Pat Cox Award Bret Thompson Foxworth Galbraith Lumber

Total Customer Satisfaction

2014 Associate Of The Year Joe Bernal Employer Benefits Of El Paso 2014 John Shatzman Award Cindy Bilbe, Stewart Title Honorary Life Members Mark Dyer Wayne Grinnell Don Henderson Chester Lovelady Cliff C. Anthes Anna Gill Brad Roe Rudy Guel E H Baeza Past Presidents Committed to Serve

Greg Bowling Kelly Sorenson Mark Dyer Mike Santamaria John Cullers Randy Bowling Doug Schwartz Robert Baeza

Bobby Bowling, IV Rudy Guel Anna Gil Bradley Roe Bob Bowling, III Edmundo Dena Hershel Stringfield Pat Woods

EPAB Mission Statement: The El Paso Association of Builders is a federated professional organization representing the home building industry, committed to enhancing the quality of life in our community by providing affordable homes of excellence and value.

The El Paso Association of Builders is a 501C(6) trade organization. © 2015 Builder’s Outlook is published and distributed for the El Paso Association of Builders

by Ted Escobedo, Snappy Publishing ted@snappypublishing.com El Paso • Texas • 915-820-2800

Builders Outlook

www.elpasobuilders.com

National, State & Local Building Industry News 2015: Issue 10

2016: Housing Recovery to pick up steam amid challenges

S

teady employment and economic growth, pent-up demand, affordable home prices and attractive mortgage rates will keep the housing market on a gradual upward trend in 2016. However, persistent headwinds related to shortages and availability of lots and labor, along with rising materials prices are impeding a more robust recovery, according to economists who participated in a National Association of Home Builders (NAHB) Fall Construction ForecastWebinar.

“This recovery is all about jobs,” said NAHB Chief Economist David Crowe. “If people can get good jobs that pay decent incomes, the housing market will continue to move forward.”

The good news, Crowe added, is that total U.S. employment of 142 million is now well above the previous peak of 138 million that occurred in 2008.

The one caveat is that job growth has been concentrated heavily in the service sector, which tends to pay lower wages than goods producing jobs.

Meanwhile, home equity has nearly doubled since 2011 and now stands at $12.5 trillion.

“The single biggest asset in most people’s portfolio is the home they own,” said Crowe. “That’s important because the primary purchasers of new homes are the sellers of existing homes. The more equity

Fall Home and Garden Show attracts thousands The annual Fall Home and Garden show brought thousands of people into the Judson Williams Convention Center as the show kicked off October 9. The throngs of people were greeted by a very nicely presented show compliments of the producer Show Technology out of San Antonio.

The show featured a spectacular showcase home by new builder member Metro Homes. The design of the display was made to be partially constructed off site in order to meet the time lines established for the show. “I have to tell you that even with that additional time we really hustled to make sure we had a great product to show,” said Fernando Torres of CTU Metro Homes. Beautiful and elegantly staged the house became the favorite of the show winning Best of Show for the efforts. “We are excited to be able to show off our models to the public and to the real estate agents because we’re new to the market and we think we have a very good product to offer the consumer,” Torres continued.

they have, the more comfortable they feel about purchasing a new home.”

And while mortgage interest rates are expected to rise over the near-term, averaging 4.5 percent in 2016 and 5.5 percent in 2017, Crowe said this is not expected to have an impact on the housing recovery. “As the economy gets better, job and wage growth should keep pace. So even though mortgage rates will rise, they will still be low by historical standards and very affordable.”

Supply Headwinds Crowe noted several factors that are hindering a more robust recovery. Citing an NAHB survey of its members, 13 percent of builders reported the cost and availability of labor was a significant problem in 2011 and that concern jumped to 61 percent in 2014.

About one-fifth of builders shared the No doubt that the home brought together ideas that really made the showcase home that much more interesting. The process of actually piecing the walls together, setting up the floor and the all that goes on a wall or in the ceiling is not something for the faint hearted. “We were asked by Habitat for Humanity to donate what we could from this build, and I’m proud that we could,” Torres told the Outlook. The rest of the showcase was quickly taken to a lot waiting for some of the frame and other parts that could be used so to not go to waste. Overall a very beautiful green showcase home that will continue to give for years to come.

The Fall Home and Garden was the only show of its kind this year since the civic center was taken over for the Men’s Bowling Championship (ABC). The civic center turned into a large bowling alley complete with state of the art lanes. “We run into situations like this when the civic center or halls we use are the only ones that can fit our shows,” said Tommy Mantini of Show Technology. “We have to be flexible but then again I know that this year we would have pent up demand and it showed during this event.”

What impressed many was the carpeted aisles and the amount of room to comfortably move around. “I thought this was one of the nicest shows we’ve had in

915-208-9313 602-708-7560

same concerns regarding lots in 2011 and that ratio shot up to 58 percent in 2014.

Concerns over building materials stood at 58 percent among builders in 2014, up from 33 percent in 2011.

some time,” said Associates Chairman Sam Shallenberger. “We had new displays and exhibitors and that was a nice thing to have.”

The presenting attraction was the Wall Wizard, Brian Santos who did several demonstrations during the three day event.

“I really love coming to El Paso and seeing so many folks for the first time,” Brian told the Outlook. “The El Paso Association of Builders has helped me get other gigs with other associations and I’m grateful for the recommendation,” he continued. Santos, who has authored several “how to” books and is an inventor and innovator for several companies including Home Depot. “My relationship with Rubber Maid and Home Depot and Lowes is really a great thing to

Single-Family Continues to Post Gains Turning to the forecast, NAHB is projecting 719,000 single-family starts in 2015, up 11 percent from the 647,000 units produced last year. Single-family production is projected to increase an additional 27 percent in 2016 to 914,000 units.

On the multifamily side, production ran at 354,000 units last year, slightly above the 331,000 level that is considered a normal level of production. Multifamily starts are expected to rise 9 percent to 387,000 units this year and post a modest 3 percent decline to 378,000 units in 2016.

Residential remodeling activity is forecasted to increase 6.8 percent in 2015 over last year and rise an additional 6.1 percent in 2016.

Continued Page 6

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bring to the consumer because I know what’s hot in the world of walls,” Santos said.

Our sincere thanks to CTU Metro Homes and all the suppliers and that staff of David Acosta Real Estate. We also owe a debt of gratitude to the exhibitors who filled the civic center with good products and lots of things for the visitor to see. Our Spring Home and Garden Show is on for March 11-13, 2016. Don’t miss this opportunity to reach potential customers. Visit Show Technology today at www.showtechnology.com to get information on the Spring show.

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