New Construction

RE/MAX Masters Home Builder Services

Co-owners of RE/MAX Masters - Steve Jacobs and Charles Jeter - bring a combined history of almost 40 years and over 1,500 transactions in new construction experience. As a part of sales teams and senior leadership of Nashville area home builders including the current top three builders the RE/MAX Masters New Home Sales Professionals bring the best practices from these industry leading builders to your operations.

Our “insider” understanding of pricing strategies used by the builder community will empower you to capture the maximum profit margin potential and leave as little money on the table as possible. Our team is trained in a structured sales process, in-depth product knowledge, regular competition reviews, quarterly market analysis, and weekly traffic reports to deliver the data to track your business and sales to grow your business.

In 2014-2015 our team has delivered over $100 Million in closings for our builders with individual companies experiencing 100% growth.

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What are the BENEFITS to RE/MAX Masters Home Builder Services?

  • RE/MAX Masters brings the same structured approach to market analysis, promotion, and sales direction as the national builders to the independent builders .
  • RE/MAX Masters provides the benefit of a Director of Sales, Director of Marketing, Design/Selection Center, and support staff without to the cost to overhead.
  • RE/MAX Masters’ Lead team’s experience working with Nashville’s top three homebuilders you will have the benefit of inside knowledge of your competitors positioning and pricing strategies
  • RE/MAX Masters has access to additional lot/land opportunities not currently on the open market that are reserved for our Home builder clients
  • RE/MAX Masters is the ONLY area brokerage to feature a Design/Selection Center that will assist Home Builder customers choosing features in their new construction home and listing clients in making selections for remodeling homes to put on the market.

News and Publications Feed


Headwinds Will Limit Single-Family Gains in 2019

Mounting housing affordability concerns coupled with supply-side constraints will limit single-family output to modest gains in 2019, according to economists speaking at the National Association of Home Builders (NAHB) International Builders’ Show in Las Vegas today.

“Ongoing job creation and solid household formations will keep demand firm, but builders will continue to grapple with supply-side headwinds that will dampen more vigorous growth in the single-family sector,” said NAHB Chief Economist Robert Dietz.

Specifically, builders are dealing with a chronic lack of construction workers; a shortage of buildable lots; onerous regulations; tariffs on lumber and other key building materials; and a slow growth in acquisition, development and construction loan activity that is failing to keep pace with demand.

All of these factors, plus home price appreciation over the past year that has outpaced wage gains, are contributing to rising affordability woes in the housing sector.

The NAHB/Wells Fargo Housing Opportunity Index released last week shows that housing affordability continues to hover at a 10-year low, with 56 percent of households able to afford a median-priced home in the fourth quarter of 2018. But a closer look at the numbers reveals that the affordability rate fell to 35 percent when only factoring in newly-built homes.

One bright spot is townhome construction, which can serve as a useful bridge for young buyers to transition to homeownership, is expanding at a robust 24 percent annualized growth rate.

The Forecast

Interest rates are anticipated to gradually rise, as NAHB expects 30-year fixed-rate mortgages will average 4.81 percent in 2019 and 5.08 percent next year.

NAHB is projecting 1.26 million total housing starts in 2018, and expects overall production to inch up 0.8 percent this year to 1.27 million units.

Single-family starts are expected to hit 876,000 units in 2018, and rise an additional 2 percent to 894,000 this year. That’s still well below the 1.1 to 1.2 million units that demographics would support. Some of this shortfall is being made up by increased use of accessory dwelling units.

On the multifamily side, NAHB is expecting multifamily starts to hit 386,000 units in 2018 and level off two percentage points to 379,000 this year. This rate of production is considered sustainable due to demographics and the balance between supply and demand.

Meanwhile, residential remodeling activity is projected to increase in the future, but at a softening rate of 4 percent growth in 2019 followed by a 2 percent gain in 2020.

South and West are Hot Spots

Delving beneath the national numbers, the South and West are the regions that will lead new-home growth in the year ahead, according to Frank Nothaft, chief economist at CoreLogic.

“Metros with good affordability, good job growth and good weather have had the highest growth in new-home sales over the last year,” said Nothaft.

New-home sales are rising fastest in the South. Leading the way are Houston, Dallas, Atlanta, Phoenix and Austin, Texas, which all averaged more than 1,000 new-home sales per month between Nov. 2017 and Oct. 2018.

Lafayette, La.; Ocala, Fla.; Wilmington, Del.; Coeur d’Alene, Idaho; and Lakeland, Fla. were the metropolitan areas that posted the highest new-home growth in terms of percentage increases over the 12-month period ending on Oct. 2018.

Nothaft added that builders continue to be hampered by rising labor and construction costs.

Recession Not in the Cards

Looking at the big picture, David Berson, senior vice president and chief economist at Nationwide Insurance, said there is a low risk of a near-term recession. However, he said that economic growth is expected to slow modestly this year in response to trade/tariff issues, higher interest rates and diminishing fiscal stimulus from the 2017 passage of the Tax Cuts and Jobs Act.

Berson expects the Federal Reserve to tighten interest rates two or three times this year, with fewer moves in future years. This anticipated action, along with inflation edging higher, should result in a modest rise in 30-year mortgage rates in 2019.

In a sign that a recession is not imminent, Berson observed that the spread between the 10-year and 1-year Treasury notes have narrowed and flattened significantly over the past year, but the yield curve is not inverted. An inverted yield curve means that the yields on bonds with a shorter duration are higher than the yields on bonds with a longer duration.

Berson noted that the best leading indicator of a recession is a yield curve that fully inverts for about three months. Even then, there is usually a lag time of 12 to 18 months following an inverted yield curve before a recession hits.

“The start date for the next recession is uncertain, but the odds rise as we look out two to three years,” Berson said.

Community, Development Firms of the Year Named in the 2018 NAHB Multifamily Pillars of the Industry Awards

Parcels at Concourse in Memphis, Tenn., was named Multifamily Community of the Year and Gables Residential, based in Atlanta, was named Multifamily Development Firm of the Year by the National Association of Home Builders (NAHB) as part of the association’s Multifamily Pillars of the Industry Awards for 2018.

A group of non-profits in Memphis took a decaying 1.5 million square-foot building that had been abandoned for decades and transformed it into the Parcels at Concourse. The 1927-vintage Sears distribution center became a “vertical urban village” that includes 265 apartments, restaurants and other retail businesses, as well as art galleries, non-profit offices and residency programs for artists, teachers, doctors and families of children receiving medical treatment.

“The Parcels at Concourse took on a building that seemed impossibly problematic and created a vital and appealing urban community,” said Steve Lawson, president of The Lawson Companies in Virginia Beach, Va., and chairman of NAHB's Multifamily Council. “The project not only transformed the building and the neighborhood, but also houses great resources for the community at large.”

Gables Residential uses a team approach to develop its properties, enlisting input from employees throughout the company before meeting with architects, land planners, contractors and interior designers. It searches out sites in walkable neighborhoods that have quality schools and are near major metropolitan employment centers, public transit and retail and entertainment districts. Gables makes sustainability a top priority and aims to certify every building to current green construction standards, which leads to durable buildings that cost less to run.

“Gables prides itself on serving its residents, its employees and the communities across the country where it has properties,” said Lawson. “That commitment to quality creates an engaging place to work, enhances community vitality and results in places that people are glad to call home.”

A panel of multifamily development and design experts also selected winners in categories ranging from excellence in building and marketing to individual and corporate achievement. Winners from all categories were recognized at a ceremony held today during the International Builders’ Show in Las Vegas. To see a complete list of winners, visit: www.nahb.org/pillarsawards.

Residential Remodeling Spending Continues to Gradually Grow

Spending on residential improvements will continue to grow over the next two years at a gradual pace, according to experts at a press conference hosted by the National Association of Home Builders (NAHB) Remodelers during the International Builders’ Show in Las Vegas. Professional remodelers from across the country agreed with the forecast, citing increased consumer confidence and demand.

NAHB predicts that remodeling spending for owner-occupied single-family homes will increase 1.6 percent in 2019 and another 1.1 percent in 2020.

“Remodeler confidence continues to remain at a high level, as remodeling spending reached $172 billion in 2018,” said 2018 NAHB Remodelers Chair Joanne Theunissen, CGP, CGR, a remodeler from Mt. Pleasant, Mich. “Although there is steady consumer demand in all areas of the country, the biggest challenges continue to be the costs of labor and materials to meet the interest.”

“We’re not only seeing more requests for proposals, but more home owners are choosing to incorporate aging-in-place design into their homes,” said Thomas Ashley, Jr., CAPS, CGP, CGR, a remodeler from Denham Springs, La. “The older housing stock combined with aging home owners allow growth in that sector of the market.”

“NAHB estimates that real spending on home improvements will continue to grow but at a slow place of about 1.6 percent in 2019,” said Danushka Nanayakkara-Skillington, NAHB’s Assistant Vice President for Forecasting and Analysis. “Factors prohibiting stronger growth include the ongoing labor shortage and rising material prices.”

The Remodeling Market Forecast is updated monthly and available for download with a subscription to housingeconomics.com.

Anthony Maschmedt, Seattle, Wash., Named 2018 NAHB Best in Green ‘One to Watch’ Young Professional of the Year

Anthony Maschmedt, Principal at Seattle-based Dwell Development + Design/Build, was honored today as the Best in Green Young Professional of the Year: One to Watch by the National Association of Home Builders (NAHB). The award was given as part of the association’s Best in Green Awards during the NAHB International Builders’ Show in Las Vegas.

During the recession, just a year after he founded Dwell Development, Anthony decided rather than scraping by he would go big. Distinguishing himself as a green builder, he built the first speculative Built Green 5-Star development in South Seattle. He then continued to distinguish himself by building the first spec. net zero energy home in Seattle, the first spec. Passive House in Seattle, and most recently the first Emerald Star home. In all that he has done, Anthony is not only focused on his business, but also the green building community at large.

Maschmedt is always looking at the best approach to building green whether it is trying a new technique, new technology or new material, he is always pushing the limits of green building. He spends a lot of time and effort collaborating with others in the industry, sharing ideas and technologies, and striving to make the industry more conducive for innovative, deep green builders like himself who are truly pioneers. Anthony serves on the board of Built Green, the Master Builders Association of King and Snohomish Counties’ residential green building program, and is constantly offering his time to speak at various events. His work has tremendously inspired others, including homeowners who themselves have gone on to become Built Green members and launch green building-related ventures of their own.

“Anthony’s innovative spirit, his willingness to try new things, including taking risks and his support of the green building industry make him an irreplaceable part, not only of his local community, but the green building community as a whole,” said Ray Tonjes, 2018 Sustainability & Green Building Subcommittee Chairman from Austin, Texas. “To achieve what he has in such a brief period of time is nothing short of remarkable.”

Lower Interest Rates, Rising Consumer Confidence Boost Builder Sentiment

Builder confidence in the market for newly-built single-family homes rose four points to 62 in February, according to the latest National Association of Home Builders/Wells Fargo Housing Market Index (HMI) released today in Las Vegas during the 75th  annual International Builders’ Show.

“Ongoing reduction in mortgage rates in recent weeks coupled with continued strength in the job market are helping to fuel builder sentiment,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “In the aftermath of the fall slowdown, many builders are reporting positive expectations for the spring selling season.”

February marked the second consecutive month in which all the HMI indices posted gains. The index measuring current sales conditions rose three points to 67, the component gauging expectations in the next six months increased five points to 68 and the metric charting buyer traffic moved up four points to 48.

“Builder confidence levels moved up in tandem with growing consumer confidence and falling interest rates,” said NAHB Chief Economist Robert Dietz. “The five-point jump on the six-month sales expectation for the HMI is due to mortgage interest rates dropping from about 5 percent in November to 4.4 percent this week. However, affordability remains a critical issue. Rising costs stemming from excessive regulations, a dearth of buildable lots, a persistent labor shortage and tariffs on lumber and other key building materials continue to make it increasingly difficult to produce housing at affordable price points.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

Looking at the three-month moving averages for regional HMI scores, the South posted a one-point gain to 63 while the Northeast dropped two points to 43.  The Midwest and West each remained unchanged at 52 and 67, respectively.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

NAHB Recognizes the Best in Green and Sustainable Building

The National Association of Home Builders (NAHB) today announced the winners of its Best in Green (BIG) Awards at a ceremony during the NAHB International Builders’ Show in Las Vegas.

In its fifth year, the BIG Awards received outstanding nominations and brought recognition to the best of the best green certified projects in a variety of categories. Categories included single-family homes, multifamily projects, communities and remodeling.  Winners were chosen based on their innovative use of green features, aesthetics, functionality, amenities and high performance certifications.

In addition to the top green projects, the BIG Awards also honored two Home Builders Associations who have long been advocates and leaders in the green and sustainable space.

“The Best in Green Awards are the industry’s most prominent awards recognizing projects and individuals that are leading the way in high performance and sustainability,” said Ray Tonjes, NAHB’s 2018 Sustainability & Green Building Subcommittee Chairman from Austin, Texas. “This year’s award winners are a particularly impressive group, representing the best of the best across several sectors of the building industry.”

This year’s winners include:

  • Best in Green 55+ Community: Mirabella, Bradenton, Florida, submitted by Koral & Gobuty Development, LLC
  • Best in Green Community: Mahncke Park, San Antonio, Texas, submitted by Imagine Homes
  • Best in Green Community: Caliza Courts Rowhouses, Alys Beach, Florida, submitted by Green$mart Companies
  • Best in Green Multifamily Affordable Project: Elements Collection, Denver, Colorado submitted by Thrive Home Builders
  • Best in Green Multifamily Market Rate Project: Ten at Clarendon, Arlington, Virginia, submitted by CBG Building Company
  • Best in Green Single-Family Custom Home: Historic Infill Home, Decatur, Georgia, submitted by SK Collaborative
  • Best in Green Single-Family Production Home: Panacea Collection, Denver, Colorado, submitted by Thrive Home Builders
  • Best in Green Remodeling Project: Norcross Remodel, Dallas, Texas, submitted by Ferrier Builders Inc.
  • Best in Green NGBS Project of the Year, Historic Infill Home, Decatur, Georgia, submitted by SK Collaborative
  • Best in Green HBA of the Year (two winners), Santa Fe Area Home Builders Association and Home Builders Association of Metro Portland

“In addition to the best in green building and remodeling projects, we were pleased to be able to recognize the great work our members are doing in their local communities to support sustainable living,” noted Tonjes. “Both the Santa Fe Area HBA and the HBA or Metro Portland had such active and impactful voices in their local green building markets in very different ways, that the judges thought two awards should be given this year to celebrate the achievements within the Federation.”

To see the finalists and other additional information about the Best in Green awards visit nahb.org/bigawards.

Two Flagship Exhibit Homes Unveiled at the NAHB International Builders’ Show

The National Association of Home Builders’ (NAHB) Leading Suppliers Council, in collaboration with Professional Builder and Professional Remodeler magazines, today unveiled the latest official show homes of the International Builders’ Show (IBS): The New American Home® 2019 and The New American Remodel® 2019. IBS attendees and media members can tour the homes Feb. 19-21.

“Throughout its long history, The New American Home program has delivered some of the most extraordinary homes built, showcasing the latest home building innovations, products and technologies,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “We are pleased to once again have both a new and a remodeled home as part of the program, each bringing a unique style and featuring impressive energy efficiency ratings that will certainly spur innovations across the industry.”

The New American Home 2019 is located in the private, luxury community of Ascaya. At a high elevation in the mountains of the McCullough Range, the home boasts impressive views of the Las Vegas strip and surrounding foothills. The single-story home includes five bedrooms and five bathrooms, and features a showroom four-car garage and a dedicated entertainment lounge. Throughout the home, the design-build team from Sun West Custom Homes utilized some of the most advanced building products and techniques to optimize energy efficiency. The home is expected to achieve Emerald-level status, the highest efficiency rating of the National Green Building Standard (NGBS).

“We stepped out of the box with this project to create a truly spectacular home that not only showcases cutting-edge design and spectacular views, but also optimizes energy efficiency,” said Daniel Coletti, president of Sun West Custom Homes. “This home exemplifies how the right balance of progressive design, innovative products and a prime location can effectively blend to heighten a home’s overall aura. We were determined to incorporate several new building methods and products, and we’re very excited for people to view the finished product.”

The New American Remodel 2019 was originally a single-level home built in the 1950s. Its unique locality—a residential area near downtown Las Vegas with significant historical value and an agricultural zoning designation—presented limitless options for the comprehensive renovation directed by Luxus Design Build LLC. The home was expanded to two levels during the remodel and features a modern, West Coast design throughout. A sustainable-living theme is emphasized with the extensive use of organic materials and furnishings, as well as the addition of a backyard citrus orchard. The home is also designed to achieve NGBS Emerald status.

“Our vision was to give the home a unique, modern-rustic character, and we’ve achieved that by using a carefully balanced range of colors, textures and amenities,” said Michael Gardner, principal of studio g Architecture and lead builder of the remodeled home. “Thanks to a very creative engineering and design strategy, we developed solutions that transformed a dated home into a high-performance work of art. For those who come see it, we know it will feel unlike any other show home they’ve ever seen before.”

In addition to achieving NGBS Emerald status, both homes anticipate receiving certifications from multiple Department of Energy programs, including: Energy Star, Zero Energy Ready Home, Builders Challenge and Building America.

Achieving such high-performance ratings was made possible by incorporating state-of-the-art green/sustainable building products. The homes feature spray-foam insulation, high-quality solar panels, automated LED lighting and a full array of energy-efficient appliances.

Tour Admission

Registered attendees of IBS 2019 may tour the homes daily during the show. Complimentary shuttle buses will be available and depart every half hour from the Las Vegas Convention Center (LVCC) beginning at 8:30 a.m. until 3 p.m. Shuttle bus tickets will be distributed each day on a first-come, first-served basis from the TNAH/TNAR booths (C10 and C11) within the LVCC. The booths open at 7:15 a.m. and those interested in obtaining tickets for that day are advised to arrive as early as possible.

Housing Affordability Holds Steady at a 10-Year Low in the Fourth Quarter

A modest increase in interest rates offset a slight decline in home prices to keep housing affordability essentially level in the fourth quarter of 2018 and still hovering at a 10-year low, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI) released today.

In all, 56.6 percent of new and existing homes sold between the beginning of October and end of December were affordable to families earning the U.S. median income of $71,900. This is little changed from the 56.4 percent of homes sold in the third quarter that were affordable to median-income earners.

The national median home price moved down from $268,000 in the third quarter of 2018 to $263,000 in the fourth quarter. At the same time, average mortgage rates rose by 17 basis points in the fourth quarter to 4.89 percent from 4.72 percent in the third quarter. This was the fourth straight quarterly rate hike and the highest rate level since the second quarter of 2011.

“Builders are finding it increasingly difficult to build at price points most consumers need because they are struggling with burdensome regulations, higher material costs and shortages of lots and labor,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Historically, housing has been the canary in the coal mine, and these ongoing affordability woes should serve as a wake up call to policymakers to take immediate action.”

“While solid job growth and rising household formations are fueling a demand for housing, home price appreciation has outpaced wage gains, putting a damper on housing affordability,” said NAHB Chief Economist Robert Dietz. “To keep housing moving forward, policymakers at all levels of government should make it a priority to address affordability concerns that are hurting home buyers and home builders alike.”

Youngstown-Warren-Boardman, Ohio-Pa. supplanted Syracuse, N.Y. as the nation’s most affordable major housing market. There, 92.7 percent of all new and existing homes sold in the fourth quarter were affordable to families earning the area’s median income of $60,100. Meanwhile, Cumberland, Md.-W.Va. was rated the nation’s most affordable smaller market, with 94.9 percent of homes sold in the fourth quarter being affordable to families earning the median income of $55,500.

Rounding out the top five affordable major housing markets in respective order were Scranton-Wilkes Barre-Hazleton, Pa.; Syracuse; Indianapolis-Carmel-Anderson, Ind.; and Toledo, Ohio.

Smaller markets joining Cumberland at the top of the list included Kokomo, Ind.; Wheeling, W.Va.-Ohio; Davenport-Moline-Rock Island, Iowa-Ill.; and Elmira, N.Y.

San Francisco, for the fifth straight quarter, was the nation’s least affordable major market. There, just 6 percent of the homes sold in the fourth quarter of 2018 were affordable to families earning the area’s median income of $116,400.

Other major metros at the bottom of the affordability chart were located in California. In descending order, they included Los Angeles,-Long Beach-Glendale; Anaheim-Santa Ana-Irvine; San Jose-Sunnyvale-Santa Clara; and San Diego-Carlsbad.

All five least affordable small housing markets were also in the Golden State. At the very bottom of the affordability chart was Santa Cruz-Watsonville, where 8.5 percent of all new and existing homes sold were affordable to families earning the area’s median income of $81,400.

In descending order, other small markets at the lowest end of the affordability scale included Salinas; San Luis Obispo-Paso Robles-Arroyo Grande; San Rafael; and Napa.

Please visit www.nahb.org/hoi for tables, historic data and details.

Editor's Note: The NAHB/Wells Fargo Housing Opportunity Index (HOI) is a measure of the percentage of homes sold in a given area that are affordable to families earning the area's median income during a specific quarter. Prices of new and existing homes sold are collected from actual court records by Core Logic, a data and analytics company. Mortgage financing conditions incorporate interest rates on fixed- and adjustable-rate loans reported by the Federal Housing Finance Agency.

Statement from NAHB First Vice Chairman Greg Ugalde on President Trump’s State of the Union Address

Greg Ugalde, first vice chairman of the National Association of Home Builders (NAHB) and a builder and developer from Torrington, Conn., attended tonight’s State of the Union address and issued the following statement regarding President Trump’s remarks:

“NAHB commends President Trump for highlighting the need for large-scale nationwide investment in infrastructure that is vital to build strong communities and a thriving housing market. Homeownership and housing are essential to a strong and prosperous nation. Yet, new research by Freddie Mac shows that America’s home builders are constructing 370,000 fewer units annually than needed to satisfy demand.

“The biggest impediment to this shortfall is due to the growing housing affordability crisis. The administration and Congress must make this issue a top national priority. Policymakers can start by taking the following steps: Eliminate unnecessary regulations that raise housing costs; enact housing finance reform that enables creditworthy borrowers to obtain home loans; and promote job training programs in home building to help address the severe labor shortage that is putting upward pressure on home prices.”

Statement from NAHB Chairman Randy Noel on Sen. Crapo’s Housing Finance Reform Proposal

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., issued the following statement on Senate Banking Committee Chairman Mike Crapo’s housing finance reform proposal:

“NAHB commends Senate Banking Committee Chairman Mike Crapo for taking this important step to move the debate forward on overhauling Fannie Mae and Freddie Mac, and the U.S. housing finance system. He has consistently taken a leadership role on this issue. Sen. Crapo’s plan would maintain a limited federal backstop to the nation’s housing finance system, a critical element recommended by NAHB to achieve meaningful housing finance reform.

“Momentum on overhauling the housing finance system is clearly growing, as the administration is also looking to move forward on this issue. While a legislative solution will ultimately be required to accomplish comprehensive housing finance reform, NAHB looks forward to working with all interested stakeholders to move this process forward. A stable and reliable housing finance system is vital to a vibrant housing market and a strong economy.”

New Home Sales Higher Than Expected in November

Sales of newly built, single-family homes rose to a seasonally adjusted annual rate of 657,000 units in November after an upwardly revised October report, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. This is the highest sales pace since March 2018. However, on a year-to-date basis, sales are down 7.7 percent from this time in 2017.

The sales report was delayed due to the partial government shutdown.

“The sales increase was fueled by a notable uptick in homes sold at the affordable end of the market,” said Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La. “There is clearly a demand for new home homes even as builders continue to grapple with supply-side challenges, including shortages of lots and labor and higher building material costs stemming from tariffs.”

“Solid job growth and growing household formations should support future demand for housing even as builders continue to address mounting affordability woes,” said NAHB Chief Economist Robert Dietz. “Builders are doing all they can to hold the line on costs to meet this demand, particularly at the entry-level market.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the November reading of 657,000 units is the number of homes that would sell if this pace continued for the next 12 months.

The inventory of new homes for sale rose to 330,000 in November. The median sales price fell to $302,400, as the market has shifted to lower-cost houses.

Regionally, on a monthly basis, new home sales jumped 100 percent in the Northeast, 30.5 percent in the Midwest and 20.6 percent in the South. Sales fell 5.9 percent in the West.

55+ Housing Market Ends Fourth Quarter on a Positive Note

Builder confidence in the single-family 55+ housing market remained strong in the fourth quarter of 2018 with a reading of 66, up six points from the previous quarter, according to the National Association of Home Builders' (NAHB) 55+ Housing Market Index (HMI) released today.

The 55+ HMI measures two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each segment of the 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic).

"Overall, builders and developers in the 55+ housing market are reporting strong demand across the country,” said Chuck Ellison, chairman of NAHB's 55+ Housing Industry Council and Vice President-Land of Miller & Smith in McLean, Va. “However, builders need to continue to manage rising construction costs to keep homes in 55+ communities at affordable price points."

All three index components of the 55+ single-family HMI posted increases from the previous quarter: Present sales rose six points to 72, expected sales for the next six months increased five points to 70 and traffic of prospective buyers jumped 10 points to 53.

The 55+ multifamily condo HMI posted a gain of three points to 47. The index component for present sales increased three points to 51, expected sales for the next six months fell four points to 49 and traffic of prospective buyers rose seven points to 38.

Two of the four components of the 55+ multifamily rental market went up from the third quarter: present production increased six points to 60 and present demand for existing units rose four points to 67. Future expected production and future expected demand both fell two points to 54 and 62, respectively.

"Like the broader housing market, the 55+ HMI is benefitting from the recent decline in mortgage rates," said NAHB Chief Economist Robert Dietz. "Favorable demographics and solid home owner wealth should continue to support demand for new 55+ housing."

For the full 55+ HMI tables, please visit nahb.org/55hmi.

NAHB Announces Finalists for Best of IBS Awards

The National Association of Home Builders (NAHB) has announced the finalists for its seventh annual Best of IBS Awards for the 2019 NAHB International Builders' Show (IBS) in Las Vegas. Over 300 product entries in nine categories were judged by 31 industry and media representatives. Finalists were evaluated on criteria such as innovation, functionality and design. Winners in each category, as well as a Best Overall winner, will be named at the conclusion of the show on Thursday, Feb. 21, 2019.

Here are the finalists for 2019 Best of IBS Awards:

Best Bath Product
Aida Corporation (Booth SU836)
Daltile (Booth C4530)
Delta Electronics (Americas) Ltd. (Booth C3061)
Emser Tile (Booth C7237)
Federal Brace (Booth SU276)
Kichler Lighting LLC (Booth N1763)
Promenaid Handrails (Booth C2254)
Tile Redi USA LLC (Booth N1444)

Best Energy Efficient Product
Airex Manufacturing Inc. (Booth SU1843)
Eaton (Booth N927)
Enviro Water Products (Booth N1277)
Grex Power Tools (Booth SU4417)
High Tech Pet Products (Booth SU4332)
Huber Engineered Woods LLC (Booths C5348 and P23)
Interra USA Inc. (Booth SU3327)
LiftMaster (Booth C7937)
NTI Inc. (Booth C2046)
Pneumatic Vacuum Elevators LLC (Booth N126)
RGS Energy (Booth SU3947)
Rheem Manufacturing Company (Booth N1263)

Best Green Building Product
3M (Booth C1061)
Champagne Edition Inc. T/A Eco-Flex (Booth C2454)
Demilec Spray Foam Insulation (Booth P14)
Eco Building Systems Corp. (Booth SU3625)
Ecoinnovation Technologies (Booth C2451)
Enviro Water Products (Booth N1277)
Fab-Form Industries (Booth SU3423)
RGS Energy (Booth SU3947)

Best Home Technology Product
KEMF Life Simplified Inc. (Booth SU559)
Leviton Mfg Co (Booth SU343)
Lockly (Booth SU258)
Noon Home (Booth SU843)
Reliance Worldwide Corporation (Booth N1462)
Thermador (Booth C3830)
Whirlpool Corporation (Booth PB1)

Best Indoor Living Product
Acuity Brands (Booth C7748)
BRK Brands/First Alert (Booth SU645)
Heatilator, Heat & Glo and Majestic—Hearth & Home Technologies (Booth C5342)
Noon Home (Booth SU843)
Promenaid Handrails (Booth C2254)
Viewrail (Booth SU1659)
Whirlpool Corporation (Booth PB1)

Best Kitchen Product
Gaggenau (Booth C3830)
GE Appliances (Booth C6331)
Thermador—finalist for two products (Booth C3830)
Whirlpool Corporation (Booth PB1)
Winslyn Industries (Booth N1662)

Best Outdoor Living Product
CAMO Fasteners (Booth N963)
Hampstead (Booth N745)
Kichler Lighting (Booth N1763)
Maxim Lighting International (Booth C2664)
Phantom Screens (Booth C2461)

Best Window and Door Product
Andersen Windows Inc. (Booth C4507)
Endura Products Inc. (Booth C4915)
Marvin Windows and Doors (Booth C3819)
NanaWall Systems (Booth C3046)
Solar Innovations (Booth C6543)

Most Innovative Building Material Product
3M (Booth C1061)
Eco Building Systems Corp. (Booth SU3625)
Huber Engineered Woods LLC (Booths C5348 and P23)
Marketshare Inc. (Booth P15)
NTI Inc. (Booth C2046)

For more information on the Best of IBS Awards, visit: http://www.buildersshow.com/bestofibs.

Statement from NAHB Chairman Randy Noel on Agreement to Reopen the Government

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement regarding the agreement between President Trump and congressional leaders to reopen the federal government:

“NAHB commends President Trump and congressional leaders for working together to reopen the government for three weeks while they tackle the issue of border security. At a time when the nation is facing a growing housing affordability crisis, the shutdown has exacerbated the situation by disrupting funding for important HUD housing programs. It is vitally important that Congress and the White House come to an agreement on securing our southern border to ensure the federal government remains open indefinitely.”

Remodelers’ Confidence Holds Relatively Steady in Fourth Quarter

The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 57 in the fourth quarter of 2018, only one point lower than the previous quarter. The RMI has been consistently above 50—indicating that more remodelers report market activity is higher compared to the prior quarter than report it is lower—since the second quarter of 2013. The overall RMI averages current remodeling activity and future indicators.

“The overall remodeling market remains strong, but there are signs of concern related to rising labor and input costs,” said NAHB Remodelers Chair Joanne Theunissen, CGP, CGR, a remodeler from Mt. Pleasant, Mich. “Remodelers are battling sticker shock with many home owners who expect lower bids.”

Current market conditions fell one point from the previous quarter to 57. Among its three major components, major additions and alterations remained steady at 56, minor additions and alterations decreased one point to 56 and the home maintenance and repair component fell one point to 59.

The future market indicators dropped three points from the previous quarter to 56. Calls for bids remained still at 57, the amount of work committed for the next three months decreased seven points to 52, the backlog of remodeling jobs fell three points to 59 and appointments for proposals decreased four points to 55.

“Many of the fundamentals for the remodeling market, including demographics and economic and employment growth, remain favorable,” said NAHB Chief Economist Robert Dietz. “However, remodelers continue to face challenges in keeping their prices competitive while dealing with the increasing costs of labor and building materials.”

For the full RMI tables, please visit www.nahb.org/rmi. For more information about remodeling, visit www.nahb.org/remodel.

Lower Interest Rates Stabilize Builder Confidence

Buoyed by falling mortgage rates, builder confidence in the market for newly-built single-family homes rose two points to 58 in January on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).

“The gradual decline in mortgage rates in recent weeks helped to sustain builder sentiment,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Low unemployment, solid job growth and favorable demographics should support housing demand in the coming months.”

“Builders need to continue to manage rising construction costs to keep home prices affordable, particularly for young buyers at the entry-level of the market,” said NAHB Chief Economist Robert Dietz. “Lower interest rates that peaked around 5 percent in mid-November and have since fallen to just below 4.5 percent will help the housing market continue to grow at a modest clip as we enter the new year.”

Due to the partial government shutdown, there will be no new Census figures released tomorrow on housing starts and permits. NAHB estimates that the December Census data would show that single-family starts ended the year totaling 876,000 units, which would mark a 3 percent gain over the 2017 total of 848,900. However, the slowdown in sales during the fourth quarter of 2018 has left new home inventories elevated in some markets.

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All the HMI indices posted gains in January. The index measuring current sales conditions rose two points to 63, the component gauging expectations in the next six months increased three points to 64 and the metric charting buyer traffic edged up one point to 44.

Looking at the three-month moving averages for regional HMI scores, the Northeast dropped five points to 45; the Midwest and South both fell three points to 52 and 62, respectively; and the West registered a one-point drop to 67.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

NAHB Study Shows Nearly 130,000 Households Priced Out of Housing Market with Each $1,000 Price Increase

According to a recent study by the National Association of Home Builders (NAHB), a $1,000 increase in the cost of a median-priced newly-built home pushes 127,560 prospective buyers out of the market. In other words, based on their incomes, these households would be able to qualify for a mortgage to purchase the home before the price increase, but not afterward.

The numbers are even more startling when looking at the impact of potential interest rate increases. Just a quarter-point rise in the rate for a 30-year fixed-rate mortgage would price out around 1 million households.

“This study illustrates how even a relatively small increase in price or interest rates can dramatically impact housing affordability,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Housing affordability is a serious problem right now in communities across the country. Rising interest rates, regulatory barriers, higher building materials costs and labor shortages all add to the cost of a home, and are preventing households from achieving the goal of homeownership.”

The number of priced out households varies across both states and metropolitan areas, largely affected by the sizes of local population and the affordability of new homes. The study examines priced out estimates for every state and over 300 metropolitan areas.

Among all the states, Texas had the largest number of home buyers that would be priced of the market. The $1,000 price increase would push 11,152 households out of the market in Texas, followed by California (9,897) and Ohio (7,341).

The metropolitan area with the largest priced out effect, in terms of absolute numbers, is Chicago-Naperville-Elgin, IL-IN-WI, where 4,499 households are squeezed out of the market for a new median-priced home if the price increases by $1,000.

Statement from NAHB Chairman Randy Noel on First Step Act Being Signed into Law

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom builder from LaPlace, La., today issued the following statement after President Trump signed the First Step Act into law:

“NAHB commends the White House and Congress for working together to pass the First Step Act. This bipartisan bill backed by President Trump will reform the criminal justice system and promote vocational training for prisoners in an effort to reduce recidivism rates. We have seen the benefit of similar training programs administered through the Home Builders Institute, the educational arm of NAHB.

“The First Step Act will help address chronic labor shortages within the construction industry while providing individuals a second chance for a bright future and a meaningful career. The newly enacted law also complements the president’s workforce development initiative. A renewed federal emphasis on workforce training, coupled with private sector participation, will help meet a growing demand for skilled construction workers. Taking concrete steps to fulfill this need will boost housing and economic growth and help to ease the nation’s housing affordability woes.”

NAHB Urges Congress to Act on Housing Finance Reform

The National Association of Home Builders (NAHB) today commended House Financial Services Committee Chairman Jeb Hensarling (R-Texas) for working with lawmakers across the political aisle to develop a legislative framework to move housing finance reform forward.

“We support many aspects of the Bipartisan Housing Finance Reform Act of 2018, and are especially pleased that the draft legislation includes an explicit government backstop that assures market participants that the federal government will maintain stability, keep credit flowing and make investors whole in catastrophic circumstances,” NAHB CEO Jerry Howard said in testimony before the House Financial Services Committee.

“NAHB believes an explicit federal government guaranty is particularly important to the continued availability of the 30-year fixed-rate mortgage, which has been a staple of the U.S. housing finance system since the 1930s, and we appreciate that the preservation of the 30-year mortgage is emphasized in this draft bill,” Howard added.

With Fannie Mae and Freddie Mac languishing in conservatorship for the past decade, NAHB has been a strong proponent of comprehensive housing finance reform.

“We look forward to working with Congress to pass bipartisan housing finance reform legislation that will bring the flow of private capital back into the marketplace, ensure creditworthy borrowers have access to mortgage funding, preserve the successful multifamily housing finance framework and maintain the proper level of government support for housing in all economic and financial market conditions,” said Howard.

Single-Family Starts Drop in November as Builders Face Affordability Concerns

Rising housing affordability issues continue to hinder single-family production even as total housing starts increased in November.

According to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department, overall housing starts rose 3.2 percent in November to a seasonally adjusted annual rate of 1.26 million units from a downwardly revised October reading. Year-to-date, new housing starts are 5.1 percent above their level over the same period last year.

The November reading of 1.26 million is the number of housing units builders would start if they maintained this pace for the next 12 months. Within this overall number, single-family fell 4.6 percent to 824,000. Single-family production has now dropped for the third straight month. Meanwhile, multifamily starts—which include apartment buildings and condos—rose 22.4 percent to 432,000.

“The decline in single-family production over the last few months makes sense given the drop in our builder confidence index,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Builders are cautious to add inventory as housing affordability concerns are causing consumers to pause on making a home purchase.”

“Favorable demographics support healthy housing demand, so it is frustrating that the housing affordability crisis is preventing many consumers from achieving their goal of buying a home,” said NAHB Chief Economist Robert Dietz. “While homeownership has increased over the last nine quarters, we can expect that upward momentum to stop due to rising home costs. Because housing leads the economy, we need to stabilize residential market conditions.”

Overall permits—which are an indicator of future housing production—rose 5 percent in November to 1.39 million. Single-family permits inched up 0.1 percent to a 848,000 unit pace while multifamily permits rose 14.8 percent to an annualized rate of 480,000.

Looking at the regional numbers on a year-to-date basis, combined single-family and multifamily housing starts rose 11 percent in the West and 5.3 percent in the South. Starts fell 0.8 percent in the Northeast and 1.9 percent in the Midwest.

Also on a year-to-date basis, permit issuance rose 8.2 percent in the South and 3.2 percent in the West. Permits were down 2.7 percent in the Midwest and 2.8 percent in the Northeast.

Builder Confidence Drops Four Points Amid Concerns Over Housing Affordability

Builder confidence in the market for newly-built single-family homes fell four points to 56 in December on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) as concerns over housing affordability persist. Although this is the lowest HMI reading since May 2015, builder sentiment remains in positive territory.

“We are hearing from builders that consumer demand exists, but that customers are hesitating to make a purchase because of rising home costs,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “However, recent declines in mortgage interest rates should help move the market forward in early 2019.”

“The fact that builder confidence dropped significantly in areas of the country with high home prices shows how the growing housing affordability crisis is hurting the market,” said NAHB Chief Economist Robert Dietz. “This housing slowdown is an early indicator of economic softening, and it is important that builders manage supply-side costs to keep home prices competitive for buyers at different price points.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All the HMI indices posted declines. The index measuring current sales conditions fell six points to 61, the component gauging expectations in the next six months dropped four points to 61, and the metric charting buyer traffic edged down two points to 43.

Looking at the three-month moving averages for regional HMI scores, the Midwest dropped two points to 55; the West and South both fell three points to 68 and 65, respectively; and the Northeast registered an eight-point drop to 50.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

Statement from NAHB Chairman Randy Noel on Nomination of Mark Calabria as New FHFA Director

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., issued the following statement on Mark Calabria being nominated as the new director of the Federal Housing Finance Agency (FHFA):

“NAHB congratulates Mark Calabria on his nomination as the new director of the Federal Housing Finance Agency. Mark’s extensive experience with housing finance issues provides an outstanding background for this opportunity. We look forward to working with him to ensure the nation’s housing finance system retains the appropriate degree of federal support to provide consistent affordable mortgage credit for home buyers and liquidity and stability for homeownership and rental housing.”

Statement from NAHB Chairman Randy Noel on Proposed WOTUS Rule

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement on the newly-released proposed definition for “waters of the United States” (WOTUS) under the Clean Water Act:

“NAHB commends the Trump administration for releasing its proposed new definition of the waters of the U.S. (WOTUS) that will reduce years of uncertainty over where federal jurisdiction begins and ends. By bringing certainty and clarity to which waters fall under federal oversight, this proposal should help accelerate the permitting process so home builders can more easily provide safe and affordable housing.

“Finalizing this revised WOTUS definition will protect our nation’s waterways without adding needless regulatory burdens that will hurt housing and other industries that depend on a predictable permitting process.”

Virginia Remodeler Leo Lantz Named 2018 NAHB Remodeler of the Year

The National Association of Home Builders (NAHB) Remodelers is honoring Leo Lantz, CAPS, CGP, CGR, GMR, a remodeler from Glen Allen, Va., as the 2018 NAHB Remodeler of the Year. The NAHB Remodeler of the Year award recognizes superior business management, exemplary NAHB involvement at all levels and outstanding contributions to the remodeling industry.

"Leo Lantz has become a distinguished remodeler over the last three decades by providing excellent work for his customers, and has sincere enthusiasm to give back to his local community and industry," said NAHB Remodelers Chair Joanne Theunissen, CGP, CGR, of Mt. Pleasant, Mich. "We are thrilled to honor him with this prestigious award.”

Lantz has over 29 years of remodeling experience and founded his company, Leo Lantz Construction Inc., in 2007. As a member of the Home Builders Association of Richmond (HBAR) and NAHB Remodelers since 2010, Lantz has served in local and national leadership roles for both organizations, including 2015 chair of the HBAR. Lantz also played a key role in founding the HBAR’s Remodelers Council in March 2018. While serving as its inaugural chair, he helped recruit over 25 members in less than nine months.

Lantz has previously won the 2012, 2014 and 2017 HBAR Remodeler of the Year and was the January 2015 NAHB Remodeler of the Month. He has been involved with many community service projects, including leading a bathroom renovation for two teenage girls who lost their father to cancer. Lantz continually looks for community service opportunities and recently spearheaded an aging-in-place project to build an outdoor accessibility ramp for an older couple to help enter and exit their home.

Lantz will be honored on Feb. 19 during the NAHB Remodelers All-Stars Celebration in conjunction with the NAHB International Builders’ Show in Las Vegas.

Most Americans Cite a Housing Affordability Crisis Nationwide and Close to Home

Nearly three out of four American households believe that the nation is suffering a housing affordability crisis, and a majority of respondents reported this is a problem at their local and state level as well, according to a new nationwide survey conducted on behalf of the National Association of Home Builders (NAHB).

“These poll results confirm what builders from across the nation have been warning about—that housing affordability is an increasingly serious problem in communities across America,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “A mix of regulatory barriers, ill-considered public policy and challenging market conditions is driving up costs and making it increasingly difficult for builders to produce homes that are affordable to low- and moderate-income families.”

More than 2,200 adults were surveyed Nov. 27 through Nov. 30 to assess the public’s attitude on whether a lack of affordable housing is a problem in their neighborhoods, cities, states and nationwide. The poll cut across partisan, regional, demographic and socio-economic lines. Among its key findings:

  • 73 percent of all respondents believe that a lack of affordable housing is a problem in the U.S.
  • 68 percent believe this is an issue in their state and 54 percent cite housing affordability as a concern in their neighborhood.
  • 58 percent said that if they decided to purchase a home in the near future, they would have trouble finding a home they could afford in their city or county.
  • Breaking down by community types, 68 percent reported a dearth of affordable housing as a problem in urban communities, 64 percent said it was an issue in middle-class neighborhoods and 56 percent cited a problem in rural areas.

In terms of strategies to improve the lack of affordable housing, 55 percent believe it would be effective for their city or county to lower development and construction fees builders must pay so that more affordable units can be built and 53 percent believe it would be effective to increase government subsidies to builders to produce more affordable units.

The poll is also consistent with the latest findings from NAHB’s Housing Trends Report for the third quarter of 2018, which finds that 79 percent of buyers say they can afford to purchase fewer than half of the homes available in their local markets.

Nearly a third of America’s 119 million households are cost burdened and pay more than 30 percent of their income for housing, according to NAHB analysis of data from the Census Bureau’s 2017 American Community Survey. That number includes almost half of the nation’s renter households and a quarter of the owner households.

Regulatory requirements alone account for about 25 percent of the cost of constructing a single-family home and roughly 30 percent of the cost of a multifamily unit. And every day, builders grapple with increasing construction material costs, a shortage of skilled workers and a dwindling supply of developed lots. Restrictive policies that limit or even prohibit various types of homes and make large areas off-limits to new construction contribute significantly to the problem.

“Housing is vital to the economic health of our nation,” said Noel. “This poll should serve as a wake-up call to policymakers at all levels of government to ease regulatory burdens that needlessly drive up the cost of housing and to enact policies that will encourage the production of badly-needed affordable housing units.”

This national online survey of 2,203 adults was conducted Nov. 27-30, 2018 by Morning Consult. It has a margin of error of ± 2 percent.


Home Builders Mourn the Passing of President Bush

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom builder from LaPlace, La.,  issued the following statement on the passing of President George H. W. Bush:

“On behalf of all the members of NAHB, I wish to extend my deepest condolences to the Bush family. President Bush was an American war hero, a great statesman and an American patriot who embodied the ideals of our nation.

“He was also a true believer in housing. President Bush hosted the NAHB Board of Directors on the South Lawn of the White House to commemorate the association’s 50th anniversary. He said that ‘strong housing can help a strong economy’ and ‘the dream of homeownership keeps the American dream alive.’

“To make these words a reality, President Bush pushed vigorously for policies to ensure that housing would help boost the economy. He championed a $5,000 tax credit for first-time home buyers, called for penalty-free withdrawals from IRAs for the purchase of a first home, urged changes in the passive loss tax rules to spur real estate and housing development, and called for an extension of mortgage revenue bonds and the low-income housing tax credit.

“President Bush summed up the importance of a strong housing industry to America when he said: ‘The old adage is coming true: As housing goes, so goes the economy. Owning a home helps America, makes it better, and more caring.’

“The nation’s home builders salute his legacy of a lifetime of service to America.”

New Home Sales Drop 8.9 Percent in October as Affordability Challenges Persist

Sales of newly built, single-family homes fell to a seasonally adjusted annual rate of 544,000 units in October after an upwardly revised September report, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. This is the lowest sales pace since December 2016. However, on a year-to-date basis, sales are up 2.8 percent from this time in 2017.

“The November reading is consistent with reports from our builders, who say that the job market and demographic tailwinds bode well for housing demand but rising interest rates and home prices are forcing customers to take a pause,” said Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La. “Policymakers should see this drop in sales as an indicator that housing affordability will continue to slow down the market.”

“Home sales declined this month as housing affordability continues to be a hurdle for consumers,” said NAHB Senior Economist Danushka Nanayakkara-Skillington. “While a solid economy and positive demographics support future demand for housing, it is critical to address this mounting affordability crisis.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the October reading of 544,000 units is the number of homes that would sell if this pace continued for the next 12 months.

The inventory of new homes for sale rose to 336,000 in October. The median sales price fell 3.6 percent to $309,700, as the market is shifting to townhomes and other lower-cost houses.

Looking at the regional numbers on a year-to-date basis, new home sales rose 6.3 percent in the Midwest, 4.1 percent in the West, and 3.8 percent in the South. Home sales fell 17.1 percent in the Northeast year-to-date.

NAHB Announces Best of 55+ Housing Awards Finalists

The National Association of Home Builders (NAHB) announced the finalists for its 2019 Best of 55+ Housing Awards, the premier design and marketing competition for the 55+ housing industry. A total of 116 entries were chosen as finalists and are eligible for either a gold or silver award from NAHB's 55+ Housing Industry Council.

“Many of this year’s finalists are focusing on amenities and lifestyle, like outdoor living and entertainment spaces and the inclusion of larger garages to house recreational vehicles,” said Chuck Ellison, chairman of NAHB's 55+ Housing Industry Council and Vice President-Land of Miller & Smith in McLean, Va. “We are also seeing fresh and contemporary senior living designs, which help with attracting new residents in this competitive market.”

Finalists were selected from entries in 43 categories representing single-family homes, rental housing, service-enriched housing, lifestyle features that 55+ buyers look for and marketing activity, plus four categories representing individuals and firms.

NAHB's 55+ Housing Council launched the Best of 55+ Housing Awards to encourage quality and innovation in the 55+ housing market. The council provides information, education and networking opportunities for its members and provides advocacy support to NAHB on key 55+ housing issues. The awards program is sponsored by RMF, BSB Design, KTGY Architecture + Planning, Builders Design, Mary DeWalt Design Group and Generac.

For more information on the awards program and a complete list of this year's finalists, please visit https://www.nahb.org/en/find/award-programs/best-of-55-plus-housing-awards.aspx. Winners will be announced on Feb. 19, 2019, during the NAHB International Builders’ Show in Las Vegas.

Single-Family Starts Post Slight Decline as Builders Grapple with Affordability Issues

Rising housing affordability concerns continue to weigh on single-family production even as total housing starts edged higher in October.

According to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department, total housing starts rose 1.5 percent in October to a seasonally adjusted annual rate of 1.23 million units from an upwardly revised September reading. Year-to-date, new housing starts are 5.6 percent above their level over the same period last year.

The October reading of 1.23 million is the number of housing units builders would start if they maintained this pace for the next 12 months. Within this overall number, single-family starts edged down 1.8 percent to 865,000 units. Meanwhile, multifamily starts—which include apartment buildings and condos—rose 10.3 percent to 363,000.

“This month’s decrease in single-family starts isn’t a surprise given the drop in our builder confidence index,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Builders are showing caution as mounting housing affordability concerns are forcing some consumers to delay making a home purchase.”

“Single-family starts were strong at the beginning of the year, but weakened this summer and have remained soft,” said NAHB Chief Economist Robert Dietz. “Despite this softness, 2018 construction volume is set to be the best since the downturn. A growing economy and positive demographic tailwinds are supporting housing demand as interest rates rise. However, policymakers should take note of the November decline in builder confidence as a sign that housing affordability conditions will weigh on the housing market going forward.”

Overall permits—which are an indicator of future housing production—registered a 0.6 percent drop in October to 1.26 million. Single-family permits fell 0.6 percent to an 849,000 unit pace while multifamily permits dropped 0.5 percent to an annualized rate of 414,000.

Looking at the regional numbers on a year-to-date basis, combined single-family and multifamily housing starts rose 13.5 percent in the West and 5.5 percent in the South. Starts fell 0.6 percent in the Midwest and 4.8 percent in the Northeast.

Also on a year-to-date basis, permit issuance rose 7.6 percent in the South and 3.9 percent in the West. Permits were down 2.4 percent in the Midwest and 5 percent in the Northeast.

Multifamily Builder and Developer Confidence Weakens in Third Quarter as Market Faces Challenges

Confidence in the multifamily housing market weakened in the third quarter, according to results from the Multifamily Market Survey (MMS) released today by the National Association of Home Builders (NAHB). The MMS produces two separate indices: The Multifamily Production Index (MPI), which dropped three points to 48 compared to the previous quarter; and the Multifamily Vacancy Index (MVI), which rose two points to 47 compared to the previous quarter.

The MPI measures builder and developer sentiment about current conditions in the apartment and condo market on a scale of 0 to 100. The index and all of its components are scaled so that a number above 50 indicates that more respondents report conditions are improving than report conditions are getting worse.

The MPI is a weighted average of three key elements of the multifamily housing market: construction of low-rent units—apartments that are supported by low-income tax credits or other government subsidy programs; market-rate rental units—apartments that are built to be rented at the price the market will hold; and for-sale units—condominiums. The component measuring low-rent units increased two points to 59, while the component measuring market rate rental units fell four points to 46 and the component measuring for-sale units dropped seven points to 39.

The MVI measures the multifamily housing industry's perception of vacancies. It is a weighted average of current occupancy indexes for class A, B, and C multifamily units, and can vary from 0 to 100, where any number over 50 indicates more property managers report more vacant apartments. A reading of 47 is the highest since the first quarter of 2010.

“We are starting to see an increase in vacancy rates, which may indicate a saturation in the luxury apartment market” said Steve Lawson, president of The Lawson Companies in Virginia Beach, Va., and chairman of NAHB’s Multifamily Council. “Rising regulatory and construction costs are also affecting developers’ ability to build apartments for the ‘middle-income’ market where housing is greatly needed.”

“The drop in the MPI is consistent with affordability concerns that have emerged in the single-family market. Both sectors of the housing market face similar challenges, such as shortages of labor and increased regulatory costs,” said NAHB Chief Economist Robert Dietz. “This quarter’s MPI is yet another signal to policymakers that they should be paying more attention to housing market conditions as interest rates increase.”

Historically, the MPI and MVI have performed well as leading indicators of U.S. Census figures for multifamily starts and vacancy rates, providing information on likely movement in the Census figures one to three quarters in advance.

For data tables on the MPI and MVI, visit www.nahb.org/mms.

For more information on the NAHB Multifamily program, please visit NAHB Multifamily: https://www.nahb.org/en/members/committees-and-councils/councils/multifamily-council/nahb-multifamily.aspx.


Builder Confidence Drops as Housing Affordability Issues Rise

Growing affordability concerns resulted in builder confidence in the market for newly-built single-family homes falling eight points to 60 in November on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Despite the sharp drop, builder sentiment still remains in positive territory.

“Builders report that they continue to see signs of consumer demand for new homes but that customers are taking a pause due to concerns over rising interest rates and home prices,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La.

“For the past several years, shortages of labor and lots along with rising regulatory costs have led to a slow recovery in single-family construction,” said NAHB Chief Economist Robert Dietz. “While home price growth accommodated increasing construction costs during this period, rising mortgage interest rates in recent months coupled with the cumulative run-up in pricing has caused housing demand to stall.”

With the prospect of future interest rate hikes in store, Dietz said that builders have adopted a more cautious approach to market conditions and urged policymakers to take note.

“Recent policy statements on economic conditions have lacked commentary on housing, even as housing affordability has hit a 10-year low,” said Dietz. “Given that housing leads the economy, policymakers need to focus more on residential market conditions.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All of the major HMI indices posted declines. The index measuring current sales conditions fell seven points to 67, the component gauging expectations in the next six months dropped 10 points to 65 and the metric charting buyer traffic registered an eight-point drop to 45.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose two points to 58. The Midwest edged one point lower to 57, the South declined two points to 68 and the West dropped three points to 71.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

Statement from NAHB Chairman Randy Noel and HBI Incoming President and CEO Ed Brady on the First Step Act

Randy Noel, chairman of the National Association of Home Builders (NAHB) and Ed Brady, incoming president and CEO of the Home Builders Institute (HBI), issued the following joint statement regarding the First Step Act:

“NAHB commends Republicans and Democrats for working to advance the First Step Act and we join President Trump in supporting this bipartisan effort.

“The legislation would provide reforms to the criminal justice system to include vocational training for prisoners in an effort to reduce recidivism rates. Working with HBI, we have seen the benefits of similar training programs administered through the national nonprofit, NAHB’s industry educational partner. HBI has a proven track record of success working with justice-involved individuals and currently trains hundreds of youth and adults every day to help reintegrate them into society.

“These provisions in the First Step Act complement President Trump’s workforce development initiative. This bill would help address the construction industry’s labor shortages while providing individuals the opportunity for a second chance for a bright future and a meaningful career.”

Statement from NAHB Chairman Randy Noel on FHA Actuarial Report

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., issued the following statement after the Federal Housing Administration (FHA) released its annual actuarial report to Congress:

“Today’s FHA report is very encouraging and shows a marked upturn in the health of the FHA Mutual Mortgage Insurance Fund. The net worth of the fund increased more than $8 billion over the past year to $34.86 billion and its capital-reserve ratio jumped from an upwardly revised 2.18 percent to 2.76 percent, which is well above the congressionally mandated level of 2 percent.

“The report clearly shows that actions instituted by HUD Secretary Ben Carson and FHA Commissioner Brian Montgomery to enhance the agency’s capital reserves are showing positive results. It’s also another indicator that FHA’s financial picture continues to brighten and should provide momentum for the agency to consider a mortgage insurance premium reduction to help first-time home buyers and young families seeking to enter the housing market.”

Housing Affordability Edges Lower in the Third Quarter

A modest increase in interest rates and home prices kept housing affordability at a 10-year low in the third quarter of 2018, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Opportunity Index (HOI) released today.

In all, 56.4 percent of new and existing homes sold between the beginning of July and end of September were affordable to families earning the U.S. median income of $71,900. This is down from the 57.1 percent of homes sold in the second quarter that were affordable to median-income earners and the lowest reading since mid-2008.

The national median home price edged up from $265,000 in the second quarter of 2018 to $268,000 in the third quarter. This is the highest quarterly median price in the history of the HOI series. At the same time, average mortgage rates rose by a nominal 5 basis points in the third quarter to 4.72 percent from 4.67 percent in the second quarter.

“Continuing home price appreciation and rising interest rates coupled with persistent labor shortages are contributing to housing affordability concerns,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Builders are increasingly focusing on managing home construction costs so that they do not outpace wage gains.”

“Ongoing job and economic growth provide a solid backdrop for housing demand amid recent declines in affordability,” said NAHB Chief Economist Robert Dietz. “However, housing affordability will need to stabilize to keep forward momentum from diminishing as we move into the new year.”

For the second straight quarter, Syracuse, N.Y., remained as the nation’s most affordable major housing market. There, 88.2 percent of all new and existing homes sold in the third quarter were affordable to families earning the area’s median income of $74,100. Meanwhile, Kokomo, Ind., was rated the nation’s most affordable smaller market, with 93.2 percent of homes sold in the third quarter being affordable to families earning the median income of $64,100.

Rounding out the top five affordable major housing markets in respective order were Scranton-Wilkes Barre-Hazleton, Pa.; Indianapolis-Carmel-Anderson, Ind.; Youngstown-Warren-Boardman, Ohio-Pa.; and Harrisburg-Carlisle, Pa.

Smaller markets joining Kokomo at the top of the list included Elmira, N.Y.; Fairbanks, Alaska; Cumberland, Md.-W.Va.; and Springfield, Ohio.

San Francisco, for the fourth straight quarter, was the nation’s least affordable major market. There, just 6.4 percent of the homes sold in the third quarter of 2018 were affordable to families earning the area’s median income of $116,400.

Other major metros at the bottom of the affordability chart were located in California. In descending order, they included Los Angeles,-Long Beach-Glendale; Anaheim-Santa Ana-Irvine; San Jose-Sunnyvale-Santa Clara; and San Diego-Carlsbad.

All five least affordable small housing markets were also in the Golden State. At the very bottom of the affordability chart was Santa Cruz-Watsonville, where 6.5 percent of all new and existing homes sold were affordable to families earning the area’s median income of $81,400.

In descending order, other small markets at the lowest end of the affordability scale included Salinas; Napa; San Luis Obispo-Paso Robles-Arroyo Grande; and San Rafael.

Please visit www.nahb.org/hoi for tables, historic data and details.

Editor's Note: The NAHB/Wells Fargo Housing Opportunity Index (HOI) is a measure of the percentage of homes sold in a given area that are affordable to families earning the area's median income during a specific quarter. Prices of new and existing homes sold are collected from actual court records by Core Logic, a data and analytics company. Mortgage financing conditions incorporate interest rates on fixed- and adjustable-rate loans reported by the Federal Housing Finance Agency.

Statement from NAHB Chairman Randy Noel on 2018 Midterm Elections

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement regarding the 2018 midterm elections:

“With the 2018 midterm elections behind us, NAHB looks forward to continue working with lawmakers on both sides of the political aisle to keep housing a national priority and to expand homeownership and rental housing opportunities for all Americans. To help achieve these important goals, Congress needs to address housing affordability concerns, ease regulatory burdens, and expand job training programs to ensure an ample supply of well-trained workers to build the nation’s homes.”

NAHB Announces Finalists for Apartment and Condo Awards

Roof deck pools and lounges, stunning views, a focus on health and fitness and a friendly welcome for pets are some of the features that millennials and 55+ downsizers are looking for in a multifamily community. The National Association of Home Builders’ (NAHB) 2018 Multifamily Pillars of the Industry Awards judging is complete, and the panel of 12 industry experts narrowed down the entries to 74 finalists.

The industry judges saw condos beginning to make a comeback and while beachfront living is still a big plus, they noted that the experiences and attractions of city centers also attract both younger and older renters.

“The Pillars Awards finalists reflect inspired and forward-thinking approaches to the multifamily housing market,” said Steve Lawson, chairman of NAHB's Multifamily Council and president of The Lawson Companies in Virginia Beach, Va. “The other judges and I were truly wowed—the finalists are a great example of what the multifamily market can strive to be.”

The finalists also ran the gamut in size—from 4-unit quadraplexes to a 690-unit South Florida condo. Architects and interior designers embraced clean lines and moved closer to modern décor in model units, and the art on the walls is increasingly likely to be the work of local artists.

To view the complete list of finalists and their photo galleries, visit nahb.org/pillars. Winners in each category will be announced on Feb. 19 during the NAHB’s International Builders’ Show in Las Vegas.

Members of the press who are attending IBS are invited to attend the awards presentation. For more information, visit buildersshow.com/pillarsawards.

Builder Confidence in the 55+ Housing Market Drops in the Third Quarter

Builder confidence in the single-family 55+ housing market dropped seven points to 60 in the third quarter, according to the National Association of Home Builders' (NAHB) 55+ Housing Market Index (HMI) released today. Although the index declined, it is still in positive territory as a reading above 50 means that more builders view conditions as good than poor.

The 55+ HMI measures two segments of the 55+ housing market: single-family homes and multifamily condominiums. Each segment of the 55+ HMI measures builder sentiment based on a survey that asks if current sales, prospective buyer traffic and anticipated six-month sales for that market are good, fair or poor (high, average or low for traffic).

“Although various headwinds are starting to have an impact on the 55+ housing market, there are many parts of the country where the market is still doing well,” said Chuck Ellison, chairman of NAHB's 55+ Housing Industry Council and Vice President-Land of Miller & Smith in McLean, Va. “In some places it is becoming a challenge for builders to provide housing at prices their customers can afford.”

When compared to the previous quarter, all three single-family components of the 55+ HMI saw a decline: present sales dropped seven points to 66, sales expected in the next six months fell 12 points to 65 and traffic of prospective buyers dipped four points to 43.

The 55+ multifamily condo HMI dropped 13 points to 44. All three 55+ condo HMI components decreased as well in the third quarter: present sales and traffic of perspective buyers both fell 13 points to 48 and 31, respectively, and sales expected in the next six months dropped 10 points to 53.

All four components of the 55+ multifamily rental market went down in the third quarter: present production and demand expected in the next six months both fell 11 points to 54 and 64, respectively, production expected in the next six months dropped 12 points to 56 and present demand for existing units edged down nine points to 63.

“The decline in the single-family 55+ HMI is consistent with the recent weakness in new and existing home sales,” said NAHB Chief Economist Robert Dietz. “The high readings seen in the previous three quarters are not sustainable with high construction costs and rising interest rates.”

For the full 55+ HMI tables, please visit www.nahb.org/55hmi.

New Home Sales Fall 5.5 Percent in September as Affordability Issues Continue

Sales of newly built, single-family homes fell to a seasonally adjusted annual rate of 553,000 units after downwardly revised August, July and June reports, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. This is the lowest sales pace since December 2016. However, on a year-to-date basis, sales are up 3.5 percent from this time in 2017.

“New home sales activity has slowed this summer as housing affordability remains a serious issue,” said Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La. “However, sales are up from this time last year and builders continue to report consumer interest in housing.”

“Home price gains and rising interest rates are slowing down the housing market, particularly in high-cost areas and among entry-level buyers who are sensitive to price increases,” said NAHB Chief Economist Robert Dietz. “Builders need to provide homes at different price points to address these affordability concerns. Meanwhile, overall job and economic growth should help support the housing market in the months ahead as it adjusts to higher mortgage interest rates.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the September reading of 553,000 units is the number of homes that would sell if this pace continued for the next 12 months.

The inventory of new homes for sale was 327,000 in September. The median sales price was $320,000. Meanwhile, the median home price in September 2017 was $331,500, as the market has shifted to lower-cost homes.

Regionally, new home sales rose 6.9 percent in the Midwest. Sales fell 1.5 percent in the South, 12 percent in the West and 40.6 percent in the Northeast. On a year-to-date basis, home sales are higher in all regions expect the Northeast, which has registered a 16.5 percent decrease in sales volume.

Remodeling Confidence Remains Solid in Third Quarter

The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 58 in the third quarter of 2018, remaining stable from the previous quarter. The RMI has been consistently above 50—indicating that more remodelers report market activity is higher compared to the prior quarter than report it is lower—since the second quarter of 2013. The overall RMI averages current remodeling activity and future indicators.

“Remodelers across the country are seeing home owner demand remain strong through the midpoint of the year,” said NAHB Remodelers Chair Joanne Theunissen, CGP, CGR, a remodeler from Mt. Pleasant, Mich. “Both positive home price growth—albeit at a slightly slower rate—and good consumer confidence are supporting the steady remodeling market.”

Current market conditions rose one point from the previous quarter to 58. Among its three major components, major additions and alterations rose one point to 56, minor additions and alterations decreased one point to 57 and the home maintenance and repair component rose one point to 60.

The future market indicators remained the same as the previous quarter at 59. Calls for bids rose two points to 57, amount of work committed for the next three months increased three points to 59, the backlog of remodeling jobs fell four points to 62 and appointments for proposals decreased two points to 59.

“The stability of the RMI reflects offsetting trends in the remodeling market,” said NAHB Chief Economist Robert Dietz. “A sound economy with low unemployment and easing lumber prices are being counterbalanced by rising interest rates and the ongoing labor shortage.”

For the full RMI tables, please visit www.nahb.org/rmi. For more information about remodeling, visit www.nahb.org/remodel.

Multifamily Decline Pushes Overall Housing Starts Down in September

Led by a drop in multifamily production, total housing starts fell 5.3 percent in September to a seasonally adjusted annual rate of 1.2 million units, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department.

The September reading of 1.2 million is the number of housing units builders would start if they maintained this pace for the next 12 months. Within this overall number, single-family starts edged down 0.9 percent to 871,000 units. Meanwhile, multifamily starts—which includes apartment buildings and condos—fell 15.2 percent to 330,000.

Overall permits—which are an indicator of future housing production—registered a 0.6 percent drop in September, also due to multifamily softening. Multifamily permits decreased 7.6 percent to a 390,000 unit pace while single-family permits rose 2.9 percent to an annualized rate of 851,000.

“Housing starts are in line with builder sentiment, which shows that builders are overall confident in the housing market but continue to face supply-side challenges,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Though lumber prices have declined recently, builders remain concerned about labor shortages, especially as the number of unfilled construction jobs has reached a post-recession high.”

“This report is consistent with our forecast for gradual strengthening in the single-family sector of the housing market following the summer soft patch,” said NAHB Chief Economist Robert Dietz. “A growing economy coupled with positive demographics for housing should keep the market moving forward at a modest pace in the months ahead.”

Regionally in September, combined single-family and multifamily housing starts rose 29 percent in the Northeast and 6.6 percent in the West. Starts fell 13.7 percent in the South and 14 percent in the Midwest.

Permit issuance rose 11.1 percent in the West and 0.6 percent in the South. Permits were down 9.8 percent in the Northeast and 18.9 percent in the Midwest.

Builder Confidence Rises One Point in October, Remains at Summer Levels

Builder confidence in the market for newly-built single-family homes rose one point to 68 in October on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI). Builder confidence levels have held in the high 60s since June.

“Builders are motivated by solid housing demand, fueled by a growing economy and a generational low for unemployment,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “Builders are also relieved that lumber prices have declined for three straight months from elevated levels earlier this summer, but they need to manage supply-side costs to keep home prices affordable.”

“Favorable economic conditions and demographic tailwinds should continue to support demand, but housing affordability has become a challenge due to ongoing price and interest rate increases,” said NAHB Chief Economist Robert Dietz. “Unless housing affordability stabilizes, the market risks losing additional momentum as we head into 2019.”

Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

The HMI index measuring current sales conditions rose one point to 74 and the component gauging expectations in the next six months increased a single point to 75. Meanwhile, the metric charting buyer traffic registered a four-point uptick to 53.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose three points to 57 and the South edged up one point to 71. The West held steady at 74 and the Midwest fell two points to 57.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

Former NAHB Chairman Ed Brady Named New President and CEO of Home Builders Institute

Ed Brady, Bloomington, Ill.-based builder and developer and 2016 Chairman of the National Association of Home Builders (NAHB), has been appointed as the new president and chief executive officer of the Home Builders Institute (HBI). Brady brings with him nearly 30 years of industry experience, most recently serving as president of Brady Homes, a company founded in 1962 by his father, William Brady Sr. 

HBI is the non-profit partner of the 140,000-member NAHB. Brady will replace current HBI president and chief executive officer John Courson, who is retiring after leading the organization for the past seven years.

“Our industry is currently facing a severe shortage of skilled labor, and as we look forward, it is critical that we continue to educate, train and develop the men and women who are the future of the home building industry,” said NAHB Chairman Randy Noel, a custom home builder from La Place, La. “With his home building background and past NAHB leadership experience, Ed is the perfect person to take the lead at HBI. We look forward to working with him on this important mission, and continue the great strides we have already made in building our workforce.”

NAHB and HBI work in tandem to find solutions to help alleviate the industry’s labor shortage issue. Earlier this year, the two groups attended a White House event where together they pledged to train 50,000 new workers over the next five years, as part of President Trump’s new workforce development initiative.

In addition to Brady’s time as NAHB Chairman, he has been active in the NAHB leadership structure at the local, state and national levels throughout his career, including serving as president of the Illinois Home Builders Association and president of the Home Builders Association of Bloomington-Normal, Ill.

New Home Sales Rise 3.5 Percent in August Even as Affordability Concerns Persist

Sales of newly built, single-family homes rose 3.5 percent in August to a seasonally adjusted annual rate of 629,000 units after downwardly revised June and July reports, according to newly released data by the U.S. Department of Housing and Urban Development and the U.S. Census Bureau. These downward revisions suggest softness in new home sales activity this summer. However, on a year-to-date basis, sales are up 6.9 percent from this time in 2017.

“New home sales have ticked up in August, due to positive demographics and a strong overall economy,” said Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La. “However, housing affordability remains a serious concern and builders must manage supply-side costs and stiff regulatory hurdles to keep prices competitive.”

“Housing affordability has taken a toll on new home sales over the summer, and there could be market volatility in the months ahead as communities grapple with the aftereffects of Hurricane Florence,” said NAHB Chief Economist Robert Dietz. “Still, we expect the overall housing market to grow this year as demand continues to increase among millennials and other newcomers.”

A new home sale occurs when a sales contract is signed or a deposit is accepted. The home can be in any stage of construction: not yet started, under construction or completed. In addition to adjusting for seasonal effects, the August reading of 629,000 units is the number of homes that would sell if this pace continued for the next 12 months.

The inventory of new homes for sale was 318,000 in August. The median sales price was $320,200.

Regionally, new home sales rose 47.8 percent in the Northeast, 9.1 percent in the West and 2.7 percent in the Midwest. Sales fell 1.7 percent in the South.

Statement from NAHB Chairman Randy Noel on Sen. Warren’s Housing Bill

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., issued the following statement on the American Housing and Economic Mobility Act, legislation introduced today by Sen. Elizabeth Warren (D-Mass.):

“NAHB commends Sen. Warren for highlighting the housing affordability crisis facing the nation and introducing legislation today that seeks to bring down costs for renters and home buyers alike. A key component of the American Housing and Economic Mobility Act would eliminate unnecessary local land use rules that drive up construction costs and harm housing affordability.

“However, funding many of the provisions within this broad-based bill by raising the estate tax could hurt many small, family-run businesses by imperiling the ability of the owners to pass on their business to future generations. NAHB looks forward to working with Sen. Warren to address this critical issue and to find practical solutions, such as reforming local zoning laws, which will promote affordable housing in the U.S.”

Housing Starts Rise in August Amid Ongoing Affordability Concerns

Total housing starts increased 9.2 percent in August to a seasonally adjusted annual rate of 1.28 million units, according to newly released data from the U.S. Department of Housing and Urban Development and the Commerce Department.

The August reading of 1.28 million is the number of housing units builders would start if they maintained this pace for the next 12 months. Within this overall number, single-family starts increased 1.9 percent to 876,000 units. Meanwhile, the multifamily sector—which includes apartment buildings and condos—increased 29.3 percent to a total of 408,000.

“Builders remain largely confident because the economy is solid and demographics point to continued demand,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “However, affordability continues to be a concern for both builders and buyers.”

While housing production rose, overall permits—which are an indicator of future housing production—dropped 5.7 percent to 1.23 million units in August. Single-family permits fell 6.1 percent to 820,000 units, and multifamily permits dropped 4.9 percent to 409,000 units.

“Although we saw an increase in starts in August, we are likely to see softening in the market in the months ahead,” said NAHB Chief Economist Robert Dietz. “Affordability is a particular concern because of home price gains, due in part to the high regulatory burden on new home construction. Increasing costs for building materials prompted partially by recently imposed tariffs on a wide range of products are also a concern. Moreover, interest rates are continuing their gradual upward climb.”

Regionally, the West led the nation with a 19.1 percent increase in combined single-family and multifamily housing starts. Unchanged in the Northeast, starts increased 9.1 percent in the Midwest and 6.5 percent in the South.

Led by a 19.2 percent decline in the Northeast, permits decreased in every region. They were down 1.7 percent in the Midwest, 2.9 percent in the South and 8.4 percent in the West.

Statement from NAHB Chairman Randy Noel on Chinese Tariffs

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement on President Trump's decision to impose tariffs on an additional $200 billion worth of Chinese imports:

"President Trump's decision to impose 10 percent tariffs on $200 billion worth of Chinese imports, including $10 billion of goods used by the residential construction sector, could have major ramifications for the housing industry. With housing costs on the rise, this action translates into a tax increase on housing that will rise even more significantly on Jan. 1 when the tariff rate jumps to 25 percent.

"Further, this tax increase is coming on top of the current 20 percent tariffs on softwood lumber imports from Canada. The lumber tariffs have already added thousands of dollars to the price of a typical single-family home.

"With America facing a housing affordability crisis, it is counterproductive to enact policies that will needlessly drive up the cost of housing. We respectfully urge the administration to change course and work to resolve these trade disputes in a manner that won't harm American businesses and consumers."

Builder Confidence Remains Firm in September

Builder confidence in the market for newly-built single-family homes remained unchanged at a solid 67 reading in September on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI).

“Despite rising affordability concerns, builders continue to report firm demand for housing, especially as millennials and other newcomers enter the market,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La. “The recent decline in lumber prices from record-high levels earlier this summer is also welcome relief, although builders still need to manage construction costs to keep homes competitively priced.”

“A growing economy and rising incomes combined with increasing household formations should boost demand for new single-family homes moving forward,” said NAHB Chief Economist Robert Dietz. “However, housing affordability is becoming a challenge, as builders face overly burdensome regulations and rising material costs exacerbated by an escalating trade skirmish. Interest rates are also forecasted to keep rising.” Derived from a monthly survey that NAHB has been conducting for 30 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as “good,” “fair” or “poor.” The survey also asks builders to rate traffic of prospective buyers as “high to very high,” “average” or “low to very low.” Scores for each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

The HMI index measuring current sales conditions rose one point to 74 and the component gauging expectations in the next six months increased two points to 74. Meanwhile, the metric charting buyer traffic held steady at 49.

Looking at the three-month moving averages for regional HMI scores, the Northeast rose one point to 54 and the South remained unchanged at 70. The West edged down a single point to 73 and the Midwest fell three points to 59.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found at nahb.org/hmi. More information on housing statistics is also available at housingeconomics.com.

With a Dearth of Women in the Construction Industry, NAHB Members Call for Increased Recruiting Efforts to Help Address the Labor Shortage

According to labor force statistics from the Current Population Survey and analyzed by the National Association of Home Builders (NAHB), the share of women in the construction industry is currently at 9 percent, although women make up almost half—47 percent—of the total working population. While female construction employment slowly picked up to around 970,000 in 2017 after the Great Recession, it is still below the pre-recession level of 1.1 million in 2007.

In recognition of Professional Women in Building (PWB) Week from Sept. 17 – 21, members of NAHB are calling for an increase in recruiting efforts to attract women to the home building industry. As the residential construction industry continues to grapple with a severe labor shortage, PWB members say bringing additional women into the construction labor force represents a potential opportunity for the future.

“Right now more than ever is the time for our industry to not only increase our recruitment efforts, but to also change the way we talk about careers in home building to show women this industry has so much to offer them,” said Judy Dinelle, CAPS, CGP, chair of the NAHB PWB Council and building ambassador of 84 Lumber in Asheville, N.C., serving as the company’s liaison to home building associations. “We need to help the public, guidance counselors and parents understand that the industry provides a high income, significant work values, job security and a sense of accomplishment.”

One of the ways PWB members hope to accomplish introducing more females to the industry is to create more pre-apprenticeship programs throughout the country and develop leadership paths within their organizations.

“We’ve seen examples of pre-apprenticeship programs that are really quite successful, so we need to replicate those programs and implement them into more communities across the country,” said Dinelle. “We should all promote and offer to help the programs and organizations that provide training for women. It’s our responsibility to put our words into action.”

For more information on the NAHB PWB Council, visit: https://www.nahb.org/en/members/committees-and-councils/councils/nahb-professional-women-in-building-council/why-pwb.aspx. To learn more about PWB Week, visit nahb.org/pwbweek.

For more information on statistics for women in the construction industry, visit: http://eyeonhousing.org/2018/09/women-in-construction/.

Statement from NAHB Chairman Randy Noel on Trump Tariff Threat

Randy Noel, chairman of the National Association of Home Builders (NAHB) and a custom home builder from LaPlace, La., today issued the following statement after President Trump threatened to impose tariffs on an additional $267 billion worth of Chinese goods:

“Though well-intentioned, President Trump’s threat to slap an additional $267 billion worth of tariffs on Chinese goods will be counterproductive by raising costs for millions of American consumers and businesses that rely on these products, including home builders. These tariffs would be in addition to $200 billion worth of proposed tariffs that are already in the pipeline and could act as a tax increase of up to $2.5 billion on the residential construction industry.

“Currently, tariffs on steel imports and Canadian lumber shipments into the U.S. are needlessly increasing the cost of building materials and exacerbating the housing affordability crisis. Rather than escalating the situation, NAHB respectfully urges the administration to move quickly to resolve these trade disputes in a manner that won’t tax American workers and consumers.”

A 10-Year Anniversary Highlights Need for Housing Finance Reform

With Fannie Mae and Freddie Mac now marking their tenth year of conservatorship, the National Association of Home Builders (NAHB) today called on Congress to make it a priority to enact comprehensive reform to the nation’s housing finance system.

“To ensure a stable housing finance system that will support the future of homeownership and affordable multifamily housing in America, Congress must fix the structural flaws inherent in Fannie Mae’s and Freddie Mac’s government charters that contributed to the housing finance crisis,” said NAHB Chairman Randy Noel, a custom home builder from LaPlace, La.

Today, House Financial Services Chairman Jeb Hensarling (R-Texas) and Rep. John Delaney (D-Md.) issued a draft of a housing finance reform bill that includes a federal government backstop to maintain stability in the market during times of economic turmoil.

NAHB believes a federal backstop is a critical element that must be incorporated into any overhaul of the housing finance system. NAHB is also urging Congress to enact further reforms that would:

  • Preserve the successful multifamily housing finance framework;
  • Continue the roles of the federal government housing agencies;
  • Provide an equal playing field for small lenders;
  • Restart a fully private mortgage-backed securities market; and
  • Enhance the activities of state and regional sources of housing funding.

“Comprehensive legislation that incorporates these elements will ensure that housing credit remains readily available and affordable in the future, provide the foundation for a stable housing finance system and protect taxpayers,” said Noel. “And as Congress deliberates, the administration needs to ensure that reforms put in place during conservatorship that have enabled Fannie Mae and Freddie Mac to better facilitate mortgage liquidity are not cast aside.”