Waldrop Announces Promotions

Waldrop Inc., the holding company for member company Waldrop Heating & Air Conditioning, announced the following promotions:

• Johnny Leazer, Chief Financial Officer
• Dennis Pruitt, Executive Vice President over commercial and industrial construction
•  Jamie Poterfield, Executive Vice President over solar and residential service

Waldrop, Inc., was founded in 1970.  CEO Bill Caldwell stated that the promotions are the final steps of of the company's ownership succession plan.

NAHB: Growing Optimism for Housing Rings in the New Year

The new year has opened with a sense of growing optimism for housing.

Existing home sales climbed 5% in December while inventories dropped more than 9% to a 6.2 months-supply, down from 7.2 in November, which should help reduce downward pressure on home prices and increase confidence in the housing sector.

Single-family housing starts rose 4.4% in December to a seasonally-adjusted annual rate of 470,000, their fastest pace since the end of the home buyer tax credit program in 2010. This was consistent with recent improvements in builder confidence, as indicated by the NAHB/Wells Fargo Housing Market Index (HMI), which rose to 25 in January ― its highest level since the summer of 2007.

From an unsustainably high level in November, starts in buildings with five housing units or more fell 28% in December to a rate of 164,000 units, which was still 69% above the pace of a year earlier.

Although overall construction hiring slowed somewhat in December, 2011 is expected to be the first year since 2006 in which total hires exceeded total job losses in the construction sector.

Consumer prices and producer prices ― including building materials ― were both flat at the end of 2011, after increases earlier in the year.

The NAHB/First American Improving Market Index (IMI) has grown to 76 markets, many of which rely on health care and educational institutions for a solid economic base. As construction and other sectors continue to improve in 2012, the list of cities on the IMI is expected to grow.

And housing has been receiving attention from the Federal Reserve, which remains concerned over foreclosures, prices and tight credit conditions, even as improvements in multifamily building provides a boost to some areas. Examining problems in the housing market ― including an excess supply of vacant homes, reduced availability of mortgage credit and an inefficient foreclosure process ― a Fed white paper concludes that restoring health to the housing market is necessary to promote a more robust economic recovery. While suggesting possible solutions, the paper indicates that there is no one policy that will accomplish this task.

FHFA: Mortgage Rates Fall Again in December

The Federal Housing Finance Agency (FHFA) today reported that the National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders, used as an index in some ARM contracts, was 4.15 percent based on loans closed in December. This is a decrease of 0.07 percent from the previous month.

The average interest rate on conventional, 30-year, fixed-rate mortgage loans of $417,000 or less decreased 8 basis points to 4.32 percent in December. These rates are calculated  from the FHFA’s Monthly Interest Rate Survey of purchase-money mortgages (see technical note). These results reflect loans closed during the December 23-30 period. Typically, the interest rate is determined 30 to 45 days before the loan is closed. Thus, the reported rates depict market conditions prevailing in mid- to late-November.

The contract rate on the composite of all mortgage loans (fixed- and adjustable-rate) was 4.13 percent in December, down 7 basis points from 4.20 percent in November. The effective interest rate, which reflects the amortization of initial fees and charges, was 4.24 percent in December, down 7 basis points from 4.31 percent in November.

This report contains no data on adjustable-rate mortgages due to insufficient sample size.

Initial fees and charges were 0.83 percent of the loan balance in December, up 0.05 percent from 0.78 in November. Thirty-two percent of the purchase-money mortgage loans originated in December were "no-point" mortgages, down two percent from the share in November. The average term was 28.8 years in December, up 0.3 years from 28.5 years in November. The average loan-to-price ratio in December was 78.7 percent, up 1.6 percent from 77.1 percent in November. The average loan amount was $221,700 in December, up $1,200 from $220,500 in November.

To view the history of the mortgage interest rates at FHFA.gov, click here.

HBASC takes active role in reversing anti-economic development decision by S.C. Supreme Court

by Julian Barton, Director of Government Affairs
Home Builders Association of South Carolina

Late last summer the SC Supreme Court handed down a decision that sent shock waves through the development community in the SC League of Women Voters vs. Smith Land Company case. Under the Supreme Court’s Smith Land Company opinion many citizens may be in violation of the Pollution Control Act (PCA) and now every other citizen has the right to sue them, even though the case does not directly impact them.

The decision nullified sixty years of case law with two liberal interpretations of the law:

1. Zero Tolerance: The Court ruled that any discharge into the environment must have a permit – this case involved filling in .19 acre of wetlands on a .33 acre lot that was not required by state or federal law to have a permit. Based on this decision, any emission into the environment must have a permit. To meet the courts new direction, DHEC alone will need to double or triple their permitting departments!

2. Encourages Lawsuits: The Court also ruled that anyone could have “standing” in a case, and they did not have to be directly impacted by the case. In the past the individual filing the lawsuit had to be directly impacted to file suit. This now opens the door for a flood of litigation from every activist group in the state. Don’t like a Walmart in your city, don’t like electric generation plant, don’t like a business that is building on the water, then the new strategy is to bury them in lawsuits! The SC Supreme Court has set back economic development in our state by ten years!

If this case is allowed to stand, economic development in this state could come to a grinding halt as anti-economic development groups sue every business that wants to come to the state. Companies will locate in less litigious states! The court has given a big advantage to our competitors, Georgia and North Carolina, with this decision!

Senator Harvey Peeler and Representative Nelson Hardwick are expected to introduce legislation next week to reverse the onerous and dangerous SC Supreme Court decision. Passage of this bill will be a top priority for the business community this session!

Lawler bullish on home building for 2012

Writing for Calculated Risk, housing economist Tom Lawler says he has become more optimistic about home building for 2012.  In fact, Lawler is more optimistic than NAHB, a revers of his position last year, when he thought all of the housing economists were overly optimistic.

Read Lawler's report at calculatedriskblog.com by clicking here.

Charles Schwab: Housing Is Becoming "Local" Again

According to Liz Ann Sonders, Chief Investment Strategist for Charles Schwab & Co., Inc., housing appears to have hit bottom and there are signs that it is beginning to improve again.  More importantly, Sonders says, "housing is becoming 'local' again."  In addition, Sonders points out that renters are driving the recovery, not buyers.

"During the real-estate bubble's inflation and subsequent bursting, housing could be analyzed nationally and somewhat monolithically. The rising tide was lifting all (house) boats, and when the tide went out, it took everything with it. But what we're beginning to see is a broadening of conditions, with a widening spread between the have and have-not regions of the country. Another theme of the real-estate recovery is rent versus own, with a sharp bias recently toward the former."

"There are many reasons for my budding optimism about housing:

Read Sonders' entire report on housing at schwab.com by clicking here.