July 2024
Housing Affordability in Today's Market
A number of economic indicators reveal a severely unaffordable housing market. NAHB’s recently released Cost of Housing Index (CHI) showed that 38% of a typical family’s income is needed to make a mortgage payment on a median-priced new single-family home in the United States. Low-income families (earning only 50% of the median income) have to spend well more than half of their income (77%) to pay for the same home. The same struggles ring true for those purchasing existing homes — the median prices hit an all-time high last month. A typical family has to pay 36% of their income for a median-priced existing home while a low-income family needs to pay 71% of their earnings to make the same mortgage payment. Another indicator shows that 103.5 million U.S. households’ income isn’t sufficient to afford a median-priced new home because they aren’t able to qualify for the required mortgage underwriting criteria,. The lack of housing availability across the United States is also problematic. While new single-family home inventory in May is up 12.9% from a year prior, combined inventory for new and existing single-family homes is at just a 4.4 months’ supply, according to NAHB estimates. High interest rates are causing fewer home owners to put their homes on the market. Because home owners are locked into lower interest rates, they’d face a sharp increase in costs should they purchase a new home with mortgage rates so high.
OSHA Offers Enforcement Update During NAHB Meeting
IRS Issues Guidance on Energy Tax Questions The Internal Revenue Service released a draft regulation and a list of frequently asked questions regarding the new election taxpayers may take to transfer certain energy tax incentives to other parties. For purposes of residential construction, this option generally applies to the Investment Tax Credit (Sections 48 and 48E) and the Production Tax Credit (Sections 45 and 45Y).
In September 2022, OSHA broadened the scope of its Severe Violators Enforcement Program (SVEP) and expanded its criteria for placement in the program, resulting in more employers being placed on the SVEP list. Scott Ketcham, director of OSHA’s Office of the Directorate of Construction, visited the recent spring meeting of NAHB’s Construction Safety and Health Committee in Washington, D.C., to provide more detail about the SVEP update and discuss his office’s other safety initiatives. Among the changes: the SVEP was expanded to include all OSHA standards and will be applied for all types of hazards. The update also lowered the bar for an employer to be placed in the SVEP to just two willful or repeated violations or failure-to-abate notices based on serious violations. As before, the SVEP carries elevated penal- ties and stricter inspection requirements for employers placed in the program. SVEP focuses on “recalcitrant employers who demonstrate indifference to the health and safety of their employees through willful, repeated, or failure-to-abate violations.”
Focus on Trench Safety Trenching accidents almost always involve an unthinkable event that can lead to injury or death: Being buried alive. But every trench failure is avoidable with proper planning, training and safety measures. To prevent cave-ins, jobsites should use OSHA’s “Slope It, Shore It, Shield It" method: SLOPE or bench trench walls, SHORE trench walls with supports, or SHIELD trench walls with trench boxes. NAHB has a video toolbox talk that builders can use to present to their workers and subcontractors, and additional resources in the NAHB Trenching and Excavation Toolkit.
OSHA Proposes Standard for Heat Injury & Ilness Prevention in Outdoor & Indoor Work Settings
If finalized, this rulemaking would mark the first federal standard requiring employers to create a plan to evaluate and control heat hazards in their workplace. According to the proposal, the standard would apply to all employers conducting outdoor and indoor work in all general industry, construction, maritime and agriculture sectors, with some exceptions. Elements of the proposed standard include: Training for supervisors, heat safety coordinators and employees Developing and implementing a work site heat injury and illness prevention plan (a written plan must be created for employers with more than 10 employees) An initial heat trigger with a heat index of 80°F. When the workplace temperature reaches the initial heat trigger, requirements for employers include providing drinking water, break areas for indoor and outdoor work sites, acclimatization of new and returning employees, paid rest breaks if needed, and more A high heat trigger with a heat index of 90°F. Requirements for employers include giving workers a minimum 15-minute paid rest break at least every two hours, warning signs for excessively high heat areas, and more Two different options for acclimatization procedures for new or returning workers Additional recordkeeping requirements Exempt from the requirements in the standard include: Workers who are exposed to high temperatures in short duration (i.e., workers who are not exposed to temperatures at or above the initial heat trigger for more than 15 minutes in any 60-minute period) Indoor “sedentary” work Work activities performed in indoor work areas or vehicles where air-conditioning consistently keeps the ambient temperature below 80°F Work performed at home or at another remote location Emergency response workers OSHA is allowing the public to submit feedback in response to the proposal 120 days after its official publication. NAHB is reviewing the proposed rule to analyze its full impact on residential construction and will submit comments in response. If you have any questions or would like to provide feedback on the proposed standard, contact Brad Mannion at bmannion@nahb.org.
Michelle Wilson, Suddenly Spotless Brett Payne, Poca Valley Bank Maggie Christian, Leonard's Electric Greg Casdorph, RC General Contractors
Q2 '24 Deadline: August 16, 2024 Completed residential addresses from April - June 2024 hbarebates.com
Benefit to Active Builder & Remodeler HBA Members
Upcoming Events August 20 Membership Mixer WesBanco September 17 HBAGC Board Meeting September 23 HBAGC Golf Tournament Membership Dinner Sleepy Hollow Golf Club October 4 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 Sponsorship Opportunies Available
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
Consider hosting an event in 2025. Now is the time to schedule your date.
Housing Markets Cool, But Affordability Remains Elusive
The annual State of the Nation’s Housing report from the Harvard Joint Center for Housing Studies (JCHS) highlights the growing housing affordability crisis, despite a slowdown in housing prices. “Rent growth slowed over the past year, and home prices declined in a number of areas,” said Daniel McCue, a JCHS senior research associate, in a press release. “Nonetheless, housing costs remain well above pre- pandemic levels thanks to the substantial increases over the last few years.” Higher interest rates have also eroded housing affordability in the past year, with payments on the median-priced home increasing from $2,500 to $3,000. As a result, mortgages originated to first-time home buyers dropped 22% in 2022, including a 40% year-over-year drop in the fourth quarter. Inventory has also had an impact on home prices, as single-family housing starts dropped 10.8% last year. Although multifamily construction has remained strong, the JCHS report indicates that rising vacancy rates, along with higher interest rates and tighter lending standards, suggest a forthcoming slowdown in multifamily construction.