August 2024
Townhouse Construction Gains Continue
Year-over-year gains for townhouse construction continued during the second quarter 2024 as demand for medium-density housing continues to be solid despite slowing for other sectors of the building industry. According to NAHB analysis of the most recent census data, during the second quarter of 2024, single-family attached starts totaled 42,000, which is 8% higher than the second quarter of 2023. Over the last four quarters, townhouse construction starts totaled a strong 174,000 homes, which is 23% higher than the prior four-quarter period (142,000). Townhouses made up almost 15% of single-family housing starts for the second quarter of the year. Using a one-year moving average, the market share of newly-built townhouses stood at 17.2% of all single-family starts for the second quarter. With recent gains, the four-quarter moving average market share remain at the highest on record, for data going back to 1985. Prior to the current cycle, the peak market share of the last two decades for townhouse construction was set during the first quarter of 2008, when the percentage reached 14.6%, on a one-year moving average basis. This high point was set after a fairly consistent increase in the share beginning in the early 1990s. The long-run prospects for townhouse construction are positive given growing numbers of homebuyers looking fo medium-density residential neighborhoods, such as urban villages that offer walkable environments and other amenities. Where it can be zoned, it can be built.
The NAHB/Westlake Royal Remodeling Market Index (RMI) for the second quarter of 2024 posted a reading of 65, down one point compared to the previous quarter (see Figure 1). The RMI is an average of two major component indices: the Current Conditions Index and the Future Indicators Index. It is based on a survey that asks remodelers to rate various aspects of the residential remodeling market “good”, “fair” or “poor.” Responses from each question are converted to an index that lies on a scale from 0 to 100. An index number above 50 indicates a higher proportion of respondents view conditions as good rather than poor.
Lowe’s Invests in Training The Lowe’s Foundation recently announced nearly $8 million in Gable Grants to a second cohort of community and technical colleges. Since awarding its first grants one year ago, the foundation has assisted in expanding skilled trades career pathways through its growing network of 35 community colleges and nonprofits in rural and urban communities across 27 states. From funding new skilled trades facilities and instructors to accreditation programs, the grants will support carpentry and construction, HVAC, electrical, plumbing and appliance repair training.
Take Action on Codes Mandate NAHB is calling on its members to contact their members of Congress and tell them to support H.J. Res 170, a resolution that will stop HUD and the USDA from adopting the 2021 International Energy Conservation Code (IECC). A recent decision by the two agencies means they will only insure mortgages for new single-family homes if they are built to the 2021 IECC or, in the case of HUD-financed multifamily housing, built to the 2021 IECC or ASHRAE 90.1-2019.
Remodeling Market Sentiment Holds Steady in Q2
September 12, 4:00 pm HBAGC Office 540 Third Avenue South Charleston Beneficial Ownership Information Report (BOIR) The new requirement from US Treasury Department and the Financial Crimes Enforcement Network (FinCEN) Required for every existing company by December 31, 2024. This important session will be conducted by Jason Staats and Bob Ritenour. Attendees may bring a laptop and fill out the form at the meeting. You will need a copy of the driver’s license(s) for the person or persons who have a beneficial ownership in your company . . . preferably scanned on your computer. You will also need individual SSN(s) and company FIN. Handouts will include a list of exemptions, link to the website and the documents that need to be filled out. You make take the forms with you or stay and fill them out. RSVP dcrotty@hbagc.org or 304.744.2200
Allen Bell of AB Contracting recently broke ground on 304 at Valley Pointe, a multi-family housing development in Hurricane. The new development will feature 304 apartments wth amenities that include . . . One, two and three bedroom units Fitness center and resort-style swimming pool Pickleball court Wellness studio with a sauna Conference room, co-woking spaces, game room Resident clubhouse Dedicated pet park and pet grooming stations Eco-friendly greener lifestyle The development is scheduled to open in 2025.
Benjamin Carpenter, Revolt Energy
SUBMISSION DEADLINE IS SEPTEMBER 20
Upcoming Events September 12 Builders Roundtable HBAGC Office September 17 HBAGC Board Meeting September 20 Best of West Virginia Building Award Sumission Deadline September 23 HBAGC Golf Tournament Membership Dinner Sleepy Hollow Golf Club October 5 HBAGC Cruise-in Builders FirstSource November 12 HBAGC Membership Dinner Election of Officers Holiday Inn & Suites South Charleston November 19 HBAGC Board Meeting December 10 HBAGC Christmas Party Ferguson April 4-5-6 55th WV Home Show
2024 Board of Directors Officers President - Welford Haines* Ferguson Enterprises Vice President - Zach Crede Crede Lawn & Landscaping Associate Vice President - Matt Aldridge* IKO Industries Treasurer - Jason Staats* Rollins, Cleavenger & Rollins CPAs Secretary - Barbara Rucker Summit Community Bank Builder Member-at-Large - John Lee Secure Construction Immediate Past President - Bob Ritenour* Bob's Basic System Directors Brad Cunic House Doctors Tim Cunningham* Cunningham Electrical Service Robert Dorsey* L.R. Dorsey Inc. Jack Grimm Garlow Insurance Cindy Hale* Nitro Carpet Outlet & Design Center Roger Harper 84 Lumber Shannon Hudnall Truist John Kopyscianski* Builders FirstSource Connie Marshall* Encova Insurance Steve Michael* Quality Construction Michael Moore Elk River Design Dale Oxley* Modern Home Concepts Greg Paxton* Mr. Handyman of Kanawha Valley Stephanie Ramsey TTLC Merchant Solutions J.D. Stricklen* Stricklen Realty Steve Zubrzycki East Coast Tees *Life Director Donna Crotty, Executive Officer
Ready to host an event in 2025? Now is the time to get on the calendar.
What Buyers Expect to Pay vs. Actual Home Prices
There is a major gap between buyers’ expectations and home prices, according to recent surveys from NAHB and the U.S. Census Bureau. While 38% of buyers expect to pay less than $250,000 for their next home, only 5% of homes that started construction in 2023 are actually priced under $250,000. In contrast, the share of new homes being built that sell for above $250,000 is often far greater than the share of buyers seeking homes in that price range. The chart above illustrates this contrast. For new homes priced below $250,000, the red bars are longer than the blue bars, indicating that the share of prospective and recent buyers exceeds the share of new homes being built in those price ranges. Above $250,000, the opposite is true. The blue bars are longer than the red bars, indicating that the share of homes being built exceeds the share of buyers in the market at those prices.