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  NAHB is working with the FHA commissioner to get this limit repealed.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.

In case you missed it, this letter to the editor appeared in the June 8 Coumbus Dispatch.  We also are tracking some interesting news on the first time tax credit from HUD announced May 29; you’ll find that story below my letter. - JH.

‘Dispatch’ twisted news about housing

Monday,  June 8, 2009 3:09 AM

Those of us outside the news business are mystified about the ways of the newspaper world, and two headlines published by The Dispatch in the past week confirmed this.

“Housing yet to shake slump” appeared in the May 28 Dispatch, and “Lower prices boost home sales” appeared on May 27 in ThisWeek Newspapers, a publication owned by The Dispatch. These stories reported on the same data on April home sales that was recently released by the Columbus Board of Realtors.

One story was a portrayal of a depressed local housing market, based on a comparison of year-to-year data. The other was a portrayal of improving housing conditions based on a month-to-month analysis of the same data. The Dispatch sliced the numbers a different way to take the glass-half-empty approach.

Are things getting better or not in our local housing market? Realtors and home builders believe we are at the cusp of an improving housing climate based on the data, not just conjecture.

New residential construction permits are exceeding the 2008 numbers through May in Columbus, which is good news for a lot of reasons. We look forward to an improving economy in central Ohio, led by the housing market, despite what we read in The Dispatch.

JIM HILZ

Executive director

Building Industry Association of Central Ohio Columbus

New Rules Help Bring First-time Tax Credit to Closing Table

U.S. Housing and Urban Development Secretary Shaun Donovan announced on May 29 to home builders at NAHB’s spring board of directors meeting in Washington, D.C. that further reforms are underway at HUD and the Federal Housing Administration to help put the housing market back on track.

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.

The possibility of mandatory sprinker systems for single family homes in Ohio is now in the hands of the Ohio Board of Building Standards (OBBS).

On March 17, the Ohio Home Builders Association held a roundtable meeting with OBBS members and staff, as well as building officials from around Ohio to discuss the OBBS process for new code adoption and the best methods to provide input on potential new codes.  This meeting and discussion was based on the process used for the previously adopted energy and electric codes, and the new energy and sprinkler codes that will be considered by OBBS.

In 2008, the International Code Council held a very controversial vote to include mandatory sprinklers in its code book. The NAHB cried foul over the voting process - after defeating this issues several times in the past.  Approximately 700 individuals attended a Sunday morning session to vote only on agenda items related to sprinklers – a near doubling of votes counted when compared to every other issue considered at the conference. NAHB’s appeals were denied and the recommendation stood.  On a web site of advocates for mandatory sprinklers, a recent headline on a story was telling to help demonstrate that this issue will not go away soon:

Residential Fire Sprinkler Market Potential Exceeds $3 Billion Annually –
Over 10,000 Additional Skilled Workers Needed
(Residential Fire Sprinklers .com)

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.