Tuesday, December 30, 2014

FHFA Index Shows Mortgage Interest Rates Decrease in November

Nationally, interest rates on conventional purchase-money mortgages decreased from October to November, according to several indices of new mortgage contracts.

The National Average Contract Mortgage Rate for the Purchase of Previously Occupied Homes by Combined Lenders index was 4.00 percent for loans closed in late November, down 11 basis points from 4.11 percent in October.

The average interest rate on all mortgage loans was 4.01 percent, down 10 basis points from 4.11 in October.

The average interest rate on conventional, 30-year, fixed-rate mortgages of $417,000 or less was 4.24 percent, a decrease of 8 basis points from 4.32 in October.

The effective interest rate on all mortgage loans was 4.16 percent in November, down 11 basis points from 4.27 percent in November. The effective interest rate accounts for the addition of initial fees and charges over the life of the mortgage.

The average loan amount for all loans was $293,600 in November, up $8,600 from $285,000 in October.

Monday, December 29, 2014

With the New Year Comes New Reporting Requirements

Beginning Jan. 1, the Occupational Safety and Health Administration will require employers to report all work-related fatalities within eight hours and all in-patient hospitalizations, amputations and losses of an eye within 24 hours of being notified of the incident. In the past, employers only reported all workplace fatalities and when three or more workers were hospitalized in the same incident. Since September's announcement of its new requirements, OSHA has conducted extensive outreach to help employers understand the new standards. The agency recently held its first-ever Twitter chat on the subject, answering questions and directing the broader worker safety audience to useful resources.

Changes Loom for HVAC Systems, Some Water Heaters

Here is an end-of-the-year reminder of two changes planned for early 2015 for HVAC systems and some water heaters.
  • New regional standards for furnaces, air conditioners and heat pumps have been approved by the federal Department of Energy (DOE) for units installed in homes after Jan. 1, 2015. Get the details in this NAHBNow post from November.
  • Custom builders and others who install extra-large water heaters should also be aware of new requirements that go into effect for electric and gas models produced after April 15, 2015. There are alternatives, though: Get the details here.

How To Make Social Media an Effective Marketing Tool

There are three things required to make social media work as an effective marketing tool:

Develop a clear strategy before engaging in social media; define what your objectives are, who your audience is, what they’re interested in and what actions you want them to take.

Create content that is interesting and relevant to your prospective buying group. Publish this regularly through your company’s blog, then use your key social sites – Facebook, Twitter, Pinterest, Google+, etc., to drive traffic to your blog and website.

Don’t ignore other media outlets. Social media is most effective when used as an integral part of an overall marketing strategy and marketing mix.

What are the most useful social sites and where should I start?
  • Company Website or Blog
  • Facebook
  • Twitter
  • YouTube
  • LinkedIn
  • Google+ (great for SEO, or search engine optimization)

Then, when you’re comfortable with those, add:
  • Pinterest
  • Instagram
  • Vine
  • Foursquare

What’s an example of a good social media campaign?
Hold a contest, such as: Where will our next community be?
Promote it on all website, offline advertising, and social sites; Entrants go to Facebook page to submit answers – requires name and email; Entrants get information on other communities, plans, etc.; Prize: $500 gift card.

How to get started with a social media program:
  • Create an in-house team to manage your social media
  • Make sure you that everyone on the team promotes a singular message
  • Larger companies should outsource social media management

Why should I invest in a social media program?
  • It’s where the buyers are online.
  • It’s easy for prospects and buyers to learn about you in an informal way.
  • People share things they like with their friends and contacts.
  • It’s where they go to get quick answers … and they expect you to be there.
  • Social Media is branding – third-party validation
Source: NAHBNow, the blog of the National Association of Home Builders, excerpted from Social Media 3.0: It’s Easier Than You Think by Carol L. Morgan, CAPS, CSP, MIRM. To read more about the book, visit BuilderBooks.com.

Top 10 Mistakes Builders Make & How to Avoid Them in the New Year

1. Fail to see a collapse coming. All markets are local, and they all go through an up-and-down cycle, Stephani said. He said builders need to keep tabs of warning signs by monitoring the number of starts in their area, being prudent with their specs and examining fluctuations in the cost of land.

2. Don’t ask for help. Too often, builders stubbornly cling to the notion that they have all the answers and that the competition is their enemy, said Stephani. The best way for builders to find answers to improve their business is to become actively involved in their local and national builders associations. Some of the benefits of membership include advocacy, education, networking and joint marketing resources, he said. “Through NAHB, I have a network of hundreds of people I’ve met over the past years,” said Stephani. “That knowledge sharing is immense. The 20 clubs provide that opportunity as well.”

3. Alienate Realtors. The purpose of Realtors is to sell home, and builders are being penny wise and pound foolish when they try to work around them and avoid the commission fee because Realtors will often bypass the builder’s properties when showing prospective clients homes to sell. Stephani said it is wise to use Realtors because they are professional at marketing and sales, provide better access to pre-qualified clients and can help to manage client expectations.

4. Fail to set realistic expectations. To remedy this, Stephani said that the builder must make it clear to their clients that they are in charge of the project. The customer must make selections on time, be able to afford what they want, and must not attempt to supervise subcontractors or suppliers. The builder must communicate to the client that changes to the job require time and money, that delays during construction are common and that workers will not necessarily be on the job eight hours every day. “Let the client know there could be bumps in the road but that they will be happy in their home when they move in,” he said.

5. Ignore customer service. Those who ignore this item because there is no money in it, or because they are too busy, do so at their own peril. Good customer service is essential, Stephani said, and the best way to provide it is to see issues from the customer’s perspective. Builders who have a willingness to exceed customer expectations and to do what is promised often reap great rewards through word-of-mouth referrals.

6. Fail to price for profit. Builders often fail to price their homes properly due to competition, market conditions, inaccurate appraisals and pressure from Realtors. As a result, their cash flow becomes critical and they try to compensate by increasing volume. To fix this problem, Stephani suggests that builders better manage their specs, tighten financial controls and reporting, and develop a pricing approach based not just on cost but also on location.

7. Don’t update the business plan. “If you don’t put a plan in writing it can guarantee you won’t reach your goals,” he said. Builders should update their business plans on an annual basis, he added.

8. Fail to manage conflict effectively. Too often, builders do not recognize the emotional state of owners during construction and are not committed to win-win agreements with them, Stephani said. Most builder/client conflicts arise from disagreements about what was promised and what was delivered. Clear and concise wording of the contract; a complete set of plans and specifications; and good documentation of all communication are essential.

9. Don’t manage design and budget. Too often, builders fail to properly manage their clients’ expectations, fail to control the architect and let clients take control over their subcontractors and suppliers. Builders need to be up front with their clients, let them know what to expect during the building process and work in tandem with the architect.

10. Take on the client from hell. A true client from hell often displays wild mood swings; obsesses over minor details; invites conflict; demands perfection but is not willing to pay for it; creates problems for subcontractors and employees; berates, belittles and badmouths the builder; refuses to pay until sued; and is never happy. To avoid this situation, Stephani recommends that builders go with their gut feeling when interviewing a client, evaluate their personalities and traits, take note of their occupation and observe whether a husband and wife are openly arguing – which can be a warning sign.

Source: NAHBNow, official blog of the National Association of Home Builders.

About the author: Tom Stephani, president of Custom Construction Concepts Inc. based in Crystal Lake, Ill., is an internationally recognized speaker, trainer and consultant on issues relating to the residential construction industry.

FHFA House Price Index Up 0.6 Percent in October

U.S. house prices rose in October, up 0.6 percent on a seasonally adjusted basis from the previous month, according to the Federal Housing Finance Agency (FHFA) monthly House Price Index (HPI). The previously reported house price change of 0.0 percent in September remained unchanged.

The FHFA HPI is calculated using home sales price information from mortgages sold to or guaranteed by Fannie Mae and Freddie Mac. From October 2013 to October 2014, house prices were up 4.5 percent. The U.S. index is 5.1 percent below its April 2007 peak and is roughly the same as the September 2005 index level.

For the nine census divisions, seasonally adjusted monthly price changes from September 2014 to October 2014 ranged from -0.3 percent in the Pacific division to +1.5 percent in the South Atlantic division. The 12-month changes were all positive, ranging from +0.8 percent in the Middle Atlantic division to +6.0 percent in the Pacific division.

To read the complete report at FHFA.gov, click here.

Friday, December 19, 2014

2014 Bridge Awards Entry Packets Available!

As a way of recognizing the best craftsmanship and professionalism in the industry, The Home Builders Association would like to present the Second Annual Bridge Awards sponsored by GBS Building Supply. This Awards ceremony will recognize the best and brightest of the categories, outlined ...click here 
Entries will be judged February 2015 and the winners will be recognized at the 2014 Bridge Awards Ceremony on March 19, 2015. Don't miss your opportunity to showcase the craftsmanship and professionalism you put into your projects, enter today!  

SMC Education panel event- Constructing the Builder/ Realtor Relationship on January 15th - cancelled.

Please note that the SMC Education Panel Event- Constructing the Builder/ Realtor Relationship, sponsored and hosted by Jeff Lynch Appliance and TV Center on January 15th at 8:30 a.m. has been cancelled. This event will be rescheduled for later in the 2015 year.
We look forward to this event so please stay tuned for more details in 2015.

Housing Market Forecast Luncheon with the HBA, GGAR, SMC of the Upstate, and UMLA and featured speaker Dr. David Crowe.

Don’t Miss out
NAHB Chief Economist Dr. David Crowe will be
the keynote speaker at the
Housing Market Forecast Luncheon on February 3, 2015!

Want to start 2015 in the know and off right? Your HBA, SMC of the Upstate, Greater Greenville Association of Realtors (GGAR), and Upstate Mortgage Lenders Association (affiliate of MBAC) are working together to bring the best and most up to date economic information to you. Make plans to attend The Housing Market Forecast Luncheon at TD Convention Center on Tuesday, February 3rd, at 11:30 a.m. featuring Dr. David Crowe, Chief Economist for NAHB.
David Crowe is Chief Economist and Senior Vice President at the National Association of Home Builders (NAHB).   Dr. Crowe is responsible for NAHB’s forecast of housing and economic trends, survey research and analysis of the home building industry and consumer preferences as well as micro economic analysis of government policies that affect housing. 
Before becoming NAHB’s Chief Economist, Dr. Crowe was NAHB’s Senior Vice President for Regulatory and Housing Policy.  Prior to NAHB, Dr. Crowe was Deputy Director of the Division of Housing and Demographic Analysis at the U.S. Department of Housing and Urban Development. 
He has served on federal advisory committees to the Census Bureau and to the U.S. Department of Housing and Urban Development. 
Dr. Crowe holds a PhD in Economics from the University of Kentucky.

During this meeting the HBA will host a table top forum for HBA members and prospective members during registration and immediately following the meeting.  HBA members are invited to participate in the table top forum and there are 10 spaces available. If you are interested in sponsoring a TableTop contact the HBA office at 864-254-0133

To RSVP for this event or for more information on any of our upcoming events please contact the HBA office at 864-254-0133.

HBA of Greenville Holiday Schedule!

Merry Christmas and Happy Holidays! 
Your HBA of Greenville will be closed on Wednesday, December 24 through Friday, December 26th in observance of the Christmas holiday and will also be closed on December 31st through January 2nd for the New Year's holiday. 
Thank you for your support and participation and your HBA wishes you a wonderful holiday season!

Wednesday, December 17, 2014

NAHB Delivers in Lackluster Congress

Though the 113th Congress is destined to be the least productive legislative session in 40 years in terms of laws passed, NAHB was able to achieve considerable victories for our members.

A Dececember 11 article in The Hill detailing the top 10 lobbying victories of the year cited NAHB efforts to enact flood insurance reform, noting that “Congress rolled back changes to the nation’s flood insurance program enacted only two years ago, in a victory for the National Association of Realtors, the Independent Community Bankers of America, the National Association of Counties and the National Association of Home Builders, among others.

“Spurred by a spike in insurance premiums, lobbyists fought against fierce opposition from groups that said the subsidized rates from the National Flood Insurance Program could plunge the flood program that took a balance-sheet beating following Hurricane Katrina further into debt.

“Lobbyists were able to permanently roll back flood insurance premium increases that Congress enacted to help keep the program afloat.”

In 2014 alone, NAHB estimates the flood insurance law will result in:
  • $755 million more in new home construction because it is now easier for potential new home buyers to sell their existing home and trade up.
  • $361 million a year in additional remodeling activity because there is no longer added insurance expense for certain remodeling jobs.
Other Key Laws Contribute to a Builder’s Bottom Line
In addition, NAHB played an instrumental role in shepherding through Congress important legislation that helped the housing community:

Farm Bill generates $1.2 billion in additional home building and remodeling. The Farm Bill enacted into law earlier this year is a major victory for NAHB and housing. It includes an important provision championed by NAHB that will help members living and working in rural areas across the nation.

The legislation allows more than 900 communities to retain their status as “rural” areas where residents have access to important rural housing programs that help low- and very-low income households buy their own homes or find suitable rental housing. This will enable millions of Americans to maintain access to critical rural housing programs.

NAHB economists estimate that each of these 900-plus communities will receive on average more than $1 million in economic activity this year in USDA loans and grants for new construction and remodeling – funding that would have been lost had the law not been passed. In 2014 alone, it will generate an additional $1.2 billion in housing investment.

Tax extenders legislation could save builders and home owners more than $2 billion in 2014. In one of their last official acts of business before adjourning, the House and Senate approved H.R. 5771, the Tax Increase Prevention Act, which will renew scores of temporary tax provisions known as “tax extenders” that expired this year. The one-year retroactive renewal, which is through 2014 and dates back to Jan. 1, includes several provisions of interest to the housing community.
  • Section 45L Tax Credit for Energy Efficient New Homes. Provides builders a $2,000 tax credit for exceeding energy standards by 50%. The base energy code is the 2006 International Energy Conservation Code plus supplements. Section 45L is expected to save home builders $267 million in taxes for 2014 construction activity.
  • Section 25C Tax Credit for Qualified Energy Efficiency Improvements. This is a credit worth up to $500 (subject to a $500 lifetime cap), with lower caps for certain products like windows, for consumers to install qualified energy efficient upgrades. Remodelers often leverage 25C tax credits when working with clients. Section 25C is expected to save home owners who remodel $832 million in taxes for 2014 improvements.
  • Section 163 Deduction for Private Mortgage Insurance. Allows taxpayers, subject to an income cap, to deduct premiums paid for private mortgage insurance. The deduction for PMI is expected to save home owners $919 million for tax year 2014. See the full list of housing tax extenders.
Military housing can certify to the ICC 700 National Green Building Standard (NGBS).NAHB secured legislative language approved by Congress to authorize the use of the NGBS for residential construction. Project managers now have more choices when choosing green certification for new residential construction or remodeling projects, and the voluntary NGBS certification program has yet another official stamp of approval, lending more validity to state and local HBA efforts to fight green mandates.

Workforce Act Funds Training for Careers in Home Building
President Obama in July signed into law H.R. 803, the Workforce Innovation and Opportunity Act. NAHB championed this bill because it will help alleviate labor shortages in the housing industry by providing investment and resources to train workers for careers in home building and other industries. In addition, the law reauthorizes the Job Corps and Youthbuild programs as federal programs operated through the U.S. Department of Labor.

Water Resource Development Act will Improve Levees
The President in June signed into law the Water Resource Development Act. NAHB strongly supported this measure because it makes much-needed investments in our country’s underperforming levees, opening the door to new building opportunities.

This measure provides funding to enhance long-delayed flood control projects, ultimately protecting home owners in flood-prone areas. This will enable NAHB members to build homes in areas protected by better quality flood control systems. Housing markets that stand to benefit from authorization include Sacramento, Calif.; Topeka, Kan.; Fargo, N.D.; and Cedar Rapids, Iowa.

Lowe’s to Offer CGR and CAPS Scholarships in 2015

Active HBA Remodeler members can expand their knowledge—and their businesses—by earning an NAHB educational designation with the generous support of Lowe’s ProServices.

The Lowe’s CGR Scholarship and the Lowe’s CAPS Scholarship help pay for the classes needed to earn the prestigious Certified Graduate Remodeler (CGR) and Certified Aging-in-Place Specialist (CAPS) designations.

First, interested participants must apply for the scholarships, which are offered on a first-come, first-served basis. The deadline for both scholarship applications is January 2, 2015.

CGR Scholarship recipients can take the Professional Remodeler Experience Profile (PREP) online for free until March 13, 2015. Results of the PREP guide individuals to the courses they need to complete to obtain the CGR.

If the PREP is taken prior to the 2015 NAHB International Builders Show® in Las Vegas, individuals can start taking Pre-Show courses at the show January 17-20.

CAPS Scholarship recipients can take the courses needed to obtain the designation at either IBS or at the Remodeling Show in Chicago, September 30 through October 2, 2015. Courses include Business Management for Building Professionals, Project Management and Design/Build Solutions for Aging and Accessibility (CAPS II).

Customers seek Remodelers with CGR and CAPS because these designees demonstrate passion for and commitment to being the best in the industry. And companies benefit too—as another indication of their professionalism, members with the CGR and CAPS report higher annual revenues than those without.

For more information, visit nahb.org/LowesScholarships or call 800-368-5242 x8153.

Unemployment Insurance Rates Will Be Lower Than Expected in 2015

Small business owners like home builders will pay lower than expected unemployment insurance rates in 2015, the result of the State of South Carolina quickly repaying most of the nearly $1 billion it borrowed from the Federal government during the great recession.

The State of South Carolina has repayed $780 million of the $977 million it borrowed as employers cut staff, which reduced tax revenue at a time when the state's fund balance for unemployment benefits was tapped by the large influx of unemployed workers.  The state's unemployment rate exceeded 10 percent for several quarters during the Great Recession.

As a result of the rapid loan repayments, the Federal government reduced its premium for Federal unemployment taxes to the minimum of .6 percent.  Had South Carolina not repayed its loan so quickly, the federal rate would have been 5.4 percent higher at 6 percent.

Monday, December 15, 2014

What Homes Do Millennials Buy?

New NAHB research shows that millennials tend to buy homes that are smaller, older and less expensive than homes bought by older generations. Being the youngest home buyers with little or no accumulated wealth also affects how millennials shop for and buy their homes.

(View a Dec. 10 Fox Business news report where NAHB CEO Jerry Howard discusses millennial home buyers and the housing landscape.)

The majority of millennials are buying homes for the first time in their lives. Three out of four millennials who purchased a home were first-time buyers, but a quarter traded their existing homes.

Compared to older generations, millennials are less likely to buy a new home. Less than 9% of millennial home buyers bought a new home. The share was close to 12% among older home buyers.

More than two-thirds of millennials who bought homes purchased single-family detached properties. Nevertheless, compared to older home buyers, the millennial generation shows a slightly higher preference for multifamily condominiums. Close to 9% of millennial home buyers bought a multifamily property compared to less than 6% of older home buyers.

Consistent with being the youngest and largely first-time home buyers, millennials tend to buy homes that on average are smaller and concentrated in the lower price ranges compared to homes purchased by older generations. Half of all homes purchased by millennials averaged less than 1,650 square feet of living space and cost less than $148,500.


The most common reason for moving reported by millennial home buyers is to establish their own household, followed by the desire to have a larger unit and own it.

When choosing a particular home, millennials are more likely to let financial reasons influence their choice, while older generations consider the right size most often.

When selecting a new neighborhood, the right house most often influences the decision for both millennial and older home buyers. However, millennials are more likely to also pay attention to proximity to work and having good schools.

Compared to older generations of home buyers, millennials are more likely to finance home purchases out of current income rather than out of accumulated wealth, and when taking out mortgages they are more likely to use unconventional zero-down mortgages.

The research is based on the 2013 American Housing Survey (AHS), the most recent release of this ongoing biennial housing data collection. Only housing units purchased in the two years preceding the 2013 AHS interviews are considered. Housing unit characteristics are tabulated by the age of the household of head, a person in whose name the housing unit is owned. Millennial home buyers are householders that were 33 years old or younger in 2013 and bought homes within the two years prior to the AHS interviews.

Friday, December 12, 2014

NLRB Issues Final Rule on ‘Ambush’ Union Election Rules

The National Labor Relations Board has issued its final rulemaking that that would dramatically speed up union elections, reduce the time workers have to decide whether or not to join a labor union and force employers to hand over to union organizers their employees’ private information.

Under the rule, employers could have as little as 10 days to hire a lawyer and prepare for an election hearing, which would give unions a tremendous advantage in their efforts to organize employees. The rule will be published in the Federal Register on December 15, and will take effect on April 14, 2015.

NAHB strongly opposes this controversial “quickie election” rule and will continue to work with Congress to prevent it from going forward. Specifically, NAHB is concerned this rule will make it very difficult for employers to retain counsel and have sufficient time and opportunity to prepare for an election. House bills introduced in the 113th Congress (H.R. 4320 and H.R. 4321) would prevent the NLRB from accelerating the union representation election process.

In addition, NAHB is part of the Coalition for a Democratic Workforce, which has announced that it will sue the NLRB to invalidate the newly released rule that would pave the way for unfair and illegal “ambush” elections.

NAHB Promotes Health Care Bill That Will Help Small Businesses

Reps. Charles Boustany (R-La.) and Mike Thompson (D-Calif.) introduced legislation on NAHB’s behalf to reverse an IRS regulation preventing small businesses from providing employees with standalone health reimbursement arrangements (HRAs), which have been a popular benefit with HBA members.

Standalone HRAs are an employer-provided benefit that offers participants a spending account to reimburse them for qualified medical expenses.

However, in light of the Affordable Care Act’s prohibition against health plans with an annual dollar limit on essential benefits, standalone HRAs have been deemed impermissible.

The Small Business Healthcare Relief Act of 2014 would restore these tax free employer-sponsored benefits that will help employees offset rising health care costs and pay for qualified medical expenses.

GBS Building Supply Is One of SC’s Fastest Growing Companies

GBS Building Supply has been chosen as one of South Carolina’s 25 Fastest Growing Companies. The winners were honored at a luncheon at the Columbia Marriott October 21.

GBS Building Supply is a full­ service lumberyard that also provides roofing, millwork, house wrap, cabinetry, installed stone, and other products needed for construction, including “green” building materials. While GBS Building Supply provides the highest quality products, the company prides itself on customer service, innovation, and a commitment to the community.

The SC 25 Fastest Growing Companies competition is presented by The Capital Corporation. Primary sponsors are Scott & Company CPAs, Wells Fargo, McNair Attorneys, Columbia Business Monthly, and Greenville Business Magazine.

Other sponsors are Clemson University’s Rutland Institute for Ethics; the George Dean Jonson, Jr., College of Business and Economics at the University of South Carolina Upstate, and the South Carolina Chamber of Commerce.

Representatives of Capital Corp., Scott & Company and other sponsors made on-site visits of nominees to interview key personnel and view company operations.

“We had a very strong field this year,” said George Moseley, principal of Capital Corporation.

“We were impressed with the energy and passion we saw on the site visits,” said Don Mobley, managing member of Scott and Company.

“We love the opportunity to recognize the growth of South Carolina’s companies,” said Lori Coon, publisher of Columbia Business Monthly and Greenville Business Magazine.

Once all the data is in hand, the selections are made. Winners are notified, but not given their ranking until the awards luncheon.

The keynote speaker of this year’s ceremony was Jack Jones, vice president and general manager of Boeing South Carolina.

The SC 25 Fastest Growing Companies, in rank order are:

25: Infinity Marketing, Greenville
24: Integrated Systems, Inc., Darlington
23: EDTS, LLC, Greenville and Columbia
22: Avtec, Inc., Lexington
21: Chancel Builders, Inc., Conway
20: M33 Integrated Solutions, Greenville
19: eGroup, Mount Pleasant
18: GBS Building Supply, Greenville
17: Wireless Communications, Greenville
16: Trinity Healthcare Staffing Group, Inc., Florence
15: Duke Sandwich Productions, Easley
14: Dynamic Solutions, LLC, Greenville
13: Ob Hospitalist Group, Inc., Mauldin
12: O'Neal, Inc., Greenville
11: Immedion LLC, Greenville
10: Garden & Gun Magazine LLC, Charleston
9: Spartina 449, LLC., Daufuski
8: A3 Communications, Inc., Greenville
7: Unitrends, Columbia
6: MEDcare Urgent Care, LLC, Anderson
5: ISHPI, Mount Pleasant
4: Sandlapper Securities, LLC, Greenville
3: PureCars, Charleston
2: SolBright Renewable Energy, LLC, Charleston
1: Lima One Capital Management, Greenville