October 2022
Builder Confidence Falls for Ninth Straight Month
In another sign that the slowdown in the housing market continues, builder senti- ment fell for the ninth straight month in September as the combination of elevated interest rates, persistent supply chain disruptions and high home prices continue to take a toll on affordability. Builder confidence in the market for newly built single-family homes fell three points in September to 46, the lowest level since May 2014 with the exception of the spring of 2020, according to the NAHB/Wells Fargo Housing Market Index (HMI). The HMI is projecting ongoing decline for the volume of single-family housing starts. In another indicator of a weakening market, 24% of builders reported reducing home prices, up from 19% last month. Due to tightening monetary policy, mortgage rates increased above 6% last week, the highest level since 2008, which is pricing buyers out of the market. More than half of the build- bers in our survey reported using incentives to bolster sales, including mortgage rate buydowns, free amenities and price reductions. Derived from a monthly survey that NAHB has been conducting for more than 35 years, the NAHB/Wells Fargo HMI 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.
Supreme Court’s EPA Ruling Has Broad Implications
The Supreme Court’s recent decision in the case of West Virginia et al v. EPA et al could have a significant impact on federal agencies’ ability to expand regulations beyond the authority granted by Congress. The court voted 6-3 to restrict the ability of the EPA to regulate carbon emissions. Writing for the majority, Chief Justice John Roberts wrote that the EPA exceeded the authority of the Clean Air Act when it promulgated the Clean Power Plan (CPP) during the Obama administration. The decision's main relevance for NAHB is its discussion of an administrative law principle, the "major questions doctrine." The major questions doctrine holds that unless Congress clearly states its intent for a federal agency to exercise its authority to regulate an issue, courts must reject the agency's approach. The EPA will not be able to establish a similar rule affecting NAHB members through demand-side efficiency requirements. The Court's application of the major questions doctrine in this case will help NAHB and its advocacy on behalf of members in cases where an agency attempts to create new regulatory programs that depart significantly from statute.
Serve on a Committee or Council Members interested in serving the housing industry are encouraged to apply to one of NAHB's committees or council board of trustees for the 2023 leadership year. Committees and councils meet during the Spring and Fall Leadership Meetings and at the International Builders' Show to discuss key issues and consider NAHB policy. The online application is now open and the deadline to apply is Nov. 20, 11:59 p.m. ET. You must be logged in to nahb.org to see this page or submit an application.
Make Plans to Attend the Builders' Show in Las Vegas Registration is open for the 2023 NAHB International Builders’ Show® (IBS), the largest annual light cons- truction trade show in the world. IBS will take place in person at the Las Vegas Convention Center, Jan. 31-Feb. 2, where it will again co-lo- cate with the National Kitchen & Bath Association’s (NKBA) Kitchen & Bath Industry Show® (KBIS) for the 10th Annual Design & Construction Week® (DCW). The two shows will host more than 1,300 exhibiting brands spanning over 985,000 net square feet of exhibit space. This year, registration for IBS will also allow you access to the show floor of the National Hardware Show. More Women Joining Construction Workforce Women make up 11% of the construction workforce, the highest share on record, according to the most recent data from the 2021 Current Population Survey. Job gains by women have been outpacing overall job gains in construction in recent years. As a result, the share of women in construction increased from 9.1% to 11% from 2017 to 2021. As the home building industry faces an ongoing shortage of skilled labor, NAHB has made it a priority to bring women into the workforce.
NAHB Urges Action on Supply Chain NAHB CEO Jerry Howard participated recently in a White House meeting on actions to address hous- ing supply and affordability challenges across the country. The Sept. 21 meeting featured a diverse group of affordable housing leaders, including National Economic Council Director Brian Deese and HUD Secretary Marcia Fudge. Howard urged the administration to take steps to ease building material supply chain disruptions that are causing housing construction delays and higher home building costs.
Codes Victory over Nuisance Tripping A coalition of HVAC manufacturers and home builders has won an appeal to remove certain requirements in the 2020 National Electric Code (NEC) that were causing air conditioner units to trip due to an incompatibility of equipment. The ground-fault circuit interrupter (GFCI) mandate in the 2020 NEC will be halted until Sept. 1, 2026, to give manufacturers time to engineer a solution.
Report Considers Social Effects of Work from Home
Multifamily Permits Surge High mortgage rates and building production bottlenecks continue to act as a drag on the single-family housing market even as overall housing starts posted a double-digit gain in August due to a surge in multifamily production. Overall housing starts increased 12.2% to a seasonally adjusted annual rate of 1.58 million units in August from a downwardly revised July reading, according to a report from HUD and the U.S. Census Bureau. On a regional and year-to-date basis, combined single-family and multifamily starts are 4.6% higher in the Northeast, 2.4% lower in the Midwest, 5.6% higher in the South and 1.5% lower in the West.
During the COVID-19 outbreak in the early months of 2020, many businesses across the United States closed and millions of workers experienced the work from home trend out of necessity. This sudden and massive work from home experiment generated major lifestyle changes for workers, homeowners, business owners, and our communities. A new NBER working paper, “Working from Home Around the World,” provides some insight into the big shift to working from Home (WFH) and discusses implications for workers, organizations, cities, and the pace of innovation. The study surveyed full-time workers who had finished primary school in 27 countries as of mid-2021 and early 2022 and found several explanations of how and why the pandemic catalyzed the big shift to WFH. The pandemic has driven a mass, compulsory social experiment in WFH, which generated a tremendous flow of new information and greatly altered perceptions about the feasibility and productivity of WFH.
Fed Rate Hikes Slow Housing Continuing its tightening of financial conditions to bring the rate of inflation lower, the Federal Reserve’s monetary policy committee raised the federal funds target rate by 75 basis points, increasing that target to an upper bound of 3.25%. This marks the third consecutive meeting with an increase of 75 basis points. While committing to a increasingly hawkish policy path that will slow demand and reduce inflation, the Fed also noted that the economy is only growing at a “modest” pace. Among the clear signs of economic slowing are just about every housing indicator, including nine straight months of declines for home builder sentiment.
Single-Family Lot Values Reach Record Highs
Lot values for single-family detached housing starts in 2021 increased across the nation, with the national value and six out of nine Census division values setting new records. The U.S. median lot price now stands at $55,000, according to NAHB’s analysis of the Census Bureau’s Survey of Construction (SOC) data. In the New England and Pacific divisions, lot values surged 67% and 39%, respectively, and reached new historic highs, even after adjustments for inflation. As a result, half of single-family detached (SFD) homes started in New England were built on lots valued at or more than $200,000. In the Pacific division, which has the smallest lots, median lot value reached $143,000 in 2021, the second most expensive value in the nation. As a result, Pacific division lots stand out for being the most expensive in the nation in terms of per acre costs.
Please welcome our new members when you see them at our events or around town. It’s great when members do business with other members!
Interested in being a Membership Ambassador? Call Candice at 617-462-8123 for details.No heavy lifting involved!
Membership Minute Sponsored By:
South Coast Improvement Company Contact: Susanna Medoff Phone: 508.748.0615/804.638.3631 Website: http://www.southcoastimprovement.com Email: susanna.medoff@southcoastimprovement.com South Coast Improvement Company was established in 1998 and is based in Marion, MA. 80% of our business is dedicated to affordable housing and senior living. SCIC is committed to creating homes for people on Cape Cod. We’re proud of our most recently completed project in the region: Serenity Apartments at Brewster. We are a general contractor with 80 full time employees. The company is represented in the Association by our Development Analyst and Massachusetts native, Susanna Medoff.
News You Can Use 1. LAST CALL– seats are going fast for the first annual Cape Cod Construction Summit to take place on November 10th that will include CEU credit classes, exhibitors, and networking opportunities.Don’t miss out on this chance to fulfill your 6 hour live class requirement. 2. Shepley Wood Products and Cape Cod Coffee are excited to introduce Civic Roast, a Coffee for a Cause. Civic Roast is a bright, smooth, and perfectly balanced blend that combines Cape Cod Coffee’s passion for roasting exceptional coffee with Shepley’s charitable philosophy. Their goal is simple – bring our community together and pay it forward to our neighbors with every cup. A portion of the proceeds from this specialty blend go directly to support affordable housing programs on Cape Cod with Habitat for Humanity and Housing Assistance Corporation. Civic Roast is available in 16oz bags and in c-cups online at capecodcoffee.com and in-store at their 10 Evergreen Circle & Mashpee Commons locations. Enjoy Civic Roast and pay it forward with every cup! 3.HBRAMA reminds you that Now is the time to claim for Q3’22. Builder and Remodeler Members may claim for residential jobs completed between July through September 2022. FYI – some of our members are getting significant $$$ each quarter – it’s fairly easy to do, too! You can learn more about the program at the Cape Cod Construction Summit on 11/10. For more info, visit www.HBArebates.com 4.Member request: Please Like our Facebook page and Follow Us on Instagram.If you do so, you will get regular updates on upcoming events and info sessions.Don’t miss the chance to stay informed. Got anything you would like to share with fellow members? Are you working on a great build or remodel?Let us know and we will give you some free press!Send info to: candice@capecodbuilders.org
October 6th, Cape Cod Fairgrounds Over 300 high school students from around the Cape and Islands attended the 5th Residential Construction Career Day presented in association with Mass Hire.The day kicked off with a robust Women in Construction panel featuring: Ashley Entwhisle - Mac Davis Flooring Project Manager, Crystal Pieschel - MidCape Marketing Manager, Danielle Chin – Benjamin Obdyke Outside Sales, Gail O’Rourke – White Wood Kitchens owner, Katelyn Manfredo – SV Design Senior Project Manager, Kathy DeMeyer – Encore Construction owner and Savannah Reynolds – Coastal Engineering Staff Engineer. The panel was followed by indoor and outdoor exhibits meant to educate and inspire the students on the many different facets of the industry. Exhibitors from several sectors were on hand to provide live demos and advice on career paths, and several students got hands on experience during the day. Huge thanks to our sponsors, exhibitors, panelists and ambassadors who all helped make the day interesting, educational and fun.We all look forward to next year’s RCC Day.
October 11th Dinner Meeting Sponsored By Our October dinner meeting featured an informative discussion about what changes are coming to the Building Code presented by Dan Walsh, Assistant Chief of Inspections - Building and Engineering Office of Public Safety & Inspections.Attendees enjoyed a lively cocktail hour, Italian dinner and useful information session with two CEU credits towards their CSLs.
Bowling For Beds October 20th,The Lanes @ Mashpee Commons Once again, the Lanes were rocking with fierce competition and a lot of laughs during our annual Bowling for Beds Tournament to benefit Housing Assistance Corporation. Every team gave it their all, but in the end the victors were Coastal Engineering for the second year in a row. EJ Jaxtimer gave a brilliant performance as well, finishing just one point behind Coastal with Shepley rounding out the winners circle in third place. Thanks to all of our sponsors, teams and spectators. It was a great night and we are now getting ready for next year.
Monthly MIC News: Did you know that you can log in to your Member Portal to view invoices due, which includes Renewal and Event fees? Simply log in and you will see the “Make Payment” option in your portal. Those responsible for paying bills will need special permission. Need a user name and password ? Contact Karen@capecodbuilders.org
SAVE THE DATES! Tuesday, January 10, 2023 4:00 PM HBRACC Board of Directors Meeting Thursday, January 26, 2023 5:00 PM KAM Appliance Member Mixer – KAM Showroom, Hyannis, MA Wednesday, February, 15, 2023 4:00 PM HBRACC Board of Directors Meeting Wednesday, February 15, 2023 5:00 PM February Monthly Dinner Meeting-Double Tree by Hilton, Hyannis, MA Tuesday, March 14, 2023 4:00 PM HBRACC Board of Directors Meeting Tuesday, March 14, 2023 5:00 PM March Monthly Dinner Meeting Double Tree by Hilton, Hyannis, MA Tuesday, March 14, 2023 4:00 PM New Member Orientation-The Double Tree by Hilton, Hyannis, MA Tuesday, April 11, 2023 4:00 PM HBRACC Board of Directors Meeting Tuesday, April 11, 2023 5:00 PM April Monthly Dinner Meeting Double Tree by Hilton, Hyannis, MA Thursday, April 20, 2023 6:00 PM LeaMar Industries Member Mixer, LeaMar Showroom, Hyannis, MA Wednesday, April 27, 2023 6:00 PM 3rd Annual Giant Jenga Tournament – Hog Island, Orleans, MA Tuesday, May 09, 2023 4:00 PM HBRACC Board of Directors Meeting The DoubleTree by Hilton Tuesday, May 09, 2023 5:00 PM May Monthly Dinner Meeting, The DoubleTree by Hilton Wednesday, July 12, 2023 5:00 PM White Wood Kitchens Member Mixer, Sagamore Inn, Sagamore, MA Thursday, July 20, 2023 8:30 AM 22nd Annual Nail Banger’s Golf Tournament, Olde Barnstable Fairgrounds, Marston Mills, MA Saturday, August 21, 2023 5:00 PM 9thAnnual Children’s LEGO Building Competition - Johnny Kelley Park, South Dennis Tuesday, September 12, 2023 4:00 PM HBRACC Board of Director’s Meeting Tuesday, September 12, 2023 5:00 PM September Monthly Dinner Meeting Thursday, September 14, 2023 5:00 PM 5thAnnual Island Queen Cruise, Falmouth Heights, MA Tuesday, October 11, 2023 4:00 PM HBRACC Board of Directors Meeting-Virtual Thursday, October 5, 2023 5:00 PM BRICC 2023 Awards Gala, The Cape Codder Resort & Spa, Hyannis, MA Thursday, October 19, 2023 9:00 AM 6th Annual Residential Construction Career Day, The Fairgrounds, Mashpee, MA Thursday, November 09, 2023 5:00 PM 9thAnnual Bowling for Beds FunRaiser, The Lanes Bowl & Bistro, Mashpee, MA Tuesday, December 14, 2023 5:00 PM Annual Meeting & Holiday Celebration-The Daniel Webster Inn, Sandwich, MA