BIA Advocate

While we have seen some encouraging numbers regarding the local housing market, we have a long way to go. The encouragement comes from the fact that it only took the City of Columbus 7 months to reach the 2008 single-family permit number.

The figures are modest by historical standards (630 permits so far in 2009, compared to 602 for all of 2008); however, we will take any good news data that we can get.  Other communities in central Ohio are also reporting increases in permits from last year.  Overall, we have seen a 6% increase in permit activity through June over last year.

NAHB is working to extend the housing tax incentive program and other initiatives to support the housing market.  The first-time home buyer tax credit expires on December 1, 2009.  In order to continue to stimulate housing and improve the overall economy, more time is needed.

NAHB needs your help by contacting your Congressional representative.  By extending the tax credit, Congress would spur 383,000 additional home sales, including 80,000 housing starts down the road.  This stimulus will create nearly 350,000 jobs over the coming year.

Call your members of Congress today toll-free at 866-924-6242 and tell them to extend the deadline for the $8,000 tax credit through November 30, 2010 and make it available to all home buyers.   You can also visit www.revivehousingnow.com for more information.

NAHB is also urging lawmakers to help resolve the credit crunch and appraisal problems that are hampering a recovery and to support expansion of net operating loss carryback provisions in the tax code to help prevent further layoffs.

Another very important issue deals with changes made by FHA that impact condominium purchasers.  While there are a number of changes that impact condominiums, the biggest is the provision that limits FHA loans to 30% of the units in a project.  This provision is set to take effect on October 1, 2009.  NAHB is working with the FHA commissioner to get this limit repealed.

We continue to work on many issues locally and you are now receiving bi-weekly updates from me on our progress.  If you have questions, please do not hesitate to contact me.

Are we at the bottom? Has the market begun a turn-around, even if its a small one? Some recent national
numbers are encouraging.

This week’s report of 3 consecutive months of growth in housing starts is an encouraging sign.
Single-family  housing starts gained 7.5 percent in May, breaking the national mark of 400,000 starts for
the first time since November 2008.

More BIA builder members are reporting increased activity. The evidence is still antecdotal; however, there are
some encouraging signs on the horizon.

The Dispatch’s story today, a combination of national wire data and local quotes, is also a welcome sign.

For more information, see the full report here.

Kyle Katz, Craig Bohning and Sarah Benson

Last month, Kyle Katz took over as chair for the Council.  Last week we met at Casto’s office where Kyle began some new conversations about the role of the developer in downtown development, the changing nature of the marketplace as well as exciting new projects coming on line.  Also attending this meeting included Sarah Benson from Casto, Craig Bohning from EMH&T, Charlie Driscoll from Edwards Land Company, Chip Ashby from Lifestyle Communities, Malcolm Porter, Ruth Milligan and myself.

We believe a healthy urban core is essential for regional-wide development success.  Our downtown anchors our identity and market and we welcome more participation in this dynamic group of urban advocates.

About a week ago, NAHB Chief Economist David Crowe voiced optimism that the single-family market is nearing a bottom, largely as the result of the massive economic stimulus package enacted last month. Home sales, he said, are expected to bottom out in the current quarter and starts should show “some recovery” in the second half of the year. However, he noted, the improvement won’t be “robust” because of the large overhang of vacant homes on the market.

We wanted some local perspective on this comment, so we turned to Ken Danter.   As you may or may not know, he spends his life providing feasibility studies and other research used by planners, builders, developers, government officials and more.   He has helped us, among other things, with our BIA economic forecast the last few years.

He replied to Crowe’s comment:

“Locally, the turnaround was expected to begin by mid 2009 without the stimulus package. Assuming improved buyer confidence, which should also be generated by the stimulus package; we would expect a fairly active housing market by the third quarter.”

For those of you that know me, I would have naturally thought his outlook would have a bit more gloom.  But he’s close to making me an optimist yet.

In one of my first posts, I discussed how the Delaware County Commissioners were looking for an extremely needed Economic Development Director. Today, I want to applaud the Commissioners for persevering at landing Gus Comstock, former Economic Development Director for the City of Delaware, for the position.

This position is valuable to all in Central Ohio and the fact that it had been vacant for 18 months was unacceptable. Good for the new commissioners to remain focused on solving this immediate challenge.  Here’s a recap of the story from This Week news.

Development post County ups ante to secure Comstock
Saturday,  April 4, 2009 7:03 PM
By CANDACE PRESTON-COY
ThisWeek Staff Writer
Delaware city development director Gus Comstock — who last week turned down the job of Delaware County development director at $87,000 a year — will take it at $91,000.
County commissioners Tommy Thompson and Todd Hanks on March 30 voted to increase Comstock’s pay offer to $91,000.
Comstock is too valuable to the future of Delaware County to let a few thousand dollars keep him from accepting the county’s economic development coordinator position, Thompson said.
On his application for the county position, Comstock asked for a salary of $92,000. His base salary as Delaware development director is $84,000 a year.
Comstock said the county job is a “tremendous opportunity” and he looks forward to playing a broader role in county development.
Commission vice president Ken O’Brien voted against the new offer, saying it was not fair to offer Comstock more money, when the commissioners are asking others to cut their budgets.
“I want to know where the money will come from to pay him,” O’Brien said. “We have a (budget) shortfall and I hate to take it from other people who have been effective for the city.”
Thompson said he understands O’Brien’s concerns but the county stands to lose more money than the extra $4,000 in salary through lost economic development opportunities.
Comstock can hit the ground running, he said, because he already knows who is interested in locating to the county and who could be persuaded to locate here.
Hanks said the immediate answer about where the money will come from is out of the $313,000 in carryover funds the county expects to have at the end of 2009.
That amount represents less than 1 percent of the county’s annual budget, O’Brien said, when county policy states they should have a 20 percent carryover to protect the county’s bond rating. “I think Mr. Comstock is a highly qualified individual but we’re robbing Peter to pay Paul.”
“I am real concerned that for 18 months we have not had an economic coordinator. … We have also not spent money for a 911 director,” Thompson said.
“If we continue to do this with these critical positions, we will find ourselves behind the 8 ball and we’ll pay for it for the next 10 years,” he said.
“We are at the cusp when this thing (economic development in the county) breaks open. … We need to have someone in place who understands the county,” Thompson said.
After the vote O’Brien said he will “do all I can to welcome Mr. Comstock. … There are a great many things that can be accomplished in this county. I look forward to working with Mr. Comstock.”

Delaware County Commissioners have begun to grapple with their 2009 budget challenges and at this point have yet to make a move on the road and bridge funds that were orginally approved by voters in 1998.

There have been letters to the editor, actions by Township Trustees (see previous post) and also a poll by the Delaware Gazette that last running 3 to 1 against using road and bridge money for general purposes.

As you can see,  the current discussion amongst the commissioners is looking at other sources of revenue and perhaps expense reductions.

This issue is not final, it merits continued attention, as challenging economic times will remain for all of us.  Please make sure to comment here if you have any feelings about this issue; we’d love to share your feedback with the commissioners.

By the way …on a different topic: For your calendar,  this year’s Columbus Green Building Forum’s Green Building Expo is May 19. Click here for more info.

This is a common refrain heard at many local zoning hearings when a community considers a development plan for new residential or commercial development in their town.

Those of us who are involved in private sector business know that it is the very economic growth that NIMBY’s oppose that creates a healthy community. When growth slows, like our current economic downturn, we all pay — including existing residents in a community.

Case in point — Delaware City’s current consideration of a 9.8% increase in water and sewer rates for current residents:

“The bulk is related to the sewer plant expansion,” said city finance director Dean Stelzer. “We hoped growth would pay for it, but we knew if growth slowed down and we didn’t raise enough fees, we would have to go back to the rate payers. … If development picks back up, the rates could be rolled back.” (This Week Delaware, February 15, 2009.)

The challenges of this current economic downturn will be met. Soon we will work our way back to economic growth opportunities. I hope that our communities will remember this lesson — well planned growth is in everyone’s best interest.

NAHB has launched an awareness effort to revive the economy by fixing housing first. The sobering fact is that Ohio ranks fifth with 419,000 homes in negative equity according to a study by First American Core Logic. A complete map of these frightening numbers can be found here.

The urgent call to action is to contact your member of congress (likely Tiberi or Kilroy) with the message below. If you already know what you want to say - or are ready to take action easily through the NAHB web site with their message, click here.

Here are the key points:

PROBLEM: FALLING HOME PRICES ARE AT THE CORE OF THE CURRENT ECONOMIC CRISIS.

SOLUTION: FORECLOSURE PREVENTION COUPLED WITH SHORT TERM, TARGETED INCENTIVES WILL ENCOURAGE AMERICANS TO BUY OR BUILD HOMES AGAIN.

This fact sheet outlines the talking points you need to understand. And if you’d rather watch a quick video from the NAHB president explaining them - here you go:

Fix Housing First

Join us in this critical initiative. Don’t forget, what we need you to do is contact your member of congress today and urge them to Fix Housing First.