NAHB News
Housing Starts Regain Some Ground in February
Nationwide housing starts turned upward for the first time in eightmonths in February, posting a 22.2 percent gain that was due primarily to a big bump on the often volatilemultifamily side, according to numbers released from the U.S. Commerce Department.
"While welcome news, this gain only reflects a modest rebound from January, whichwas theworstmonth in history for new-home production," says National Association of Home Builders FNAHBG Chief Economist David Crowe. "The majority of the gain was due to characteristic volatility on the multifamily side, while single family housing starts were up just over one percent for the month."
"Builders did pull a larger volume of single-family permits in February, suggesting a glimmer of hope for the prime home buying season, which is near at hand," said NAHB Chairman Joe Robson, a home builder from Tulsa, Okla. "That said, we realize there's a need to be extremely cautious in terms of new building activity going forward, because there's still quite a lot of inventory out there that needs to be absorbed as foreclosures continue to flood the market in many areas."
Total U.S. housing starts rose 22.2 percent to a seasonally adjusted annual rate of 583,000 units in February. This gain reflected an 82.3 percent surge to a 226,000-unit pace on the multifamily side and a 1.1 percent gain to a 357,000-unit pace on the single-family side.
Regionally, the only area of the country to post a lower rate of total housing starts for February was the West, with a 24.6 percent decline. The Northeast posted the largest gain, of 88.6 percent, reflecting a rebound from a nearly equal decline in the previous month. Meanwhile, the Midwest posted a 58.5 percent gain following a deep plunge in January, and the South posted a 30.2 percent gain. January-February averages were well below themonthly averages for the final quarter of 2008 in all regions of the country.
Building permits,which can be an indicator of future building activity, rose 3 percent overall to a seasonally adjusted annual rate of 547,000 units in February.This reflected an 11 percent gaininsingle-family permits to 373,000 units and a 10.8 percent decline inmultifamily permits to 174,000 units.
By region, building permits recorded a 27.6 percent gain in the Northeast, no change in the Midwest, a nearly 6 percent improvement in the South, and a 13.6 percent decline in theWest in February
Home Buyer Tax Credit Website Attracts Over 840,000 Visitors
A record 844,000 prospective home buyers visited NAHB's FederalHousingTaxCredit.comwebsite in February to learn about the new $8,000 tax credit for first-time home buyers that was enacted as part of the landmark $787 billion economic stimulus package.
"We are very pleased and encouraged that so many people are visiting our informational web site at www.FederalHousingTaxCredit.com," says Joe Robson, chairman of the National Association of Home Builders and a homebuilder from Tulsa, Okla. "The spike in traffic on our website is a strong indication that the tax credit will help get some fence sitters into themarket and will help breathe some life back into the depressed housing market.
Daily site traffic started building in the week before the economic stimulus legislation was enacted, and peaked at almost 59,000 on Feb. 18, the day after the legislation was signed. NAHB anticipates that the tax credit will result in about 160,000 additional home sales in 2009.
T. Boone Pickens to Speak at National Green Building Conference
Financier and alternative energy advocate T.Boone Pickenswill speak at the 11th Annual NAHB National Green Building Conference, which will be held in Dallas May 8-10. Presented by the National Association of Home Builders, the conference is the largest event of its kind focusing on the residential green building market.
Pickens will address the award nominees, local and national association leaders and other attendees at the 2009 NAHB National Green Building Awards Dinner, which takes place Friday May 8. He is expected to speak about environmental initiatives that can help conserve energy,water and other natural resources and the important role that the home building industry continues to play in mainstreaming new technologies.
"We are delighted that one of our host state's most famous residents will share his expertisewith our conference attendees," says Joanne Theunissen, a builder and remodeler in Mt. Pleasant, Mich., and chair of the 2009 NAHB National Green Building Conference.
This year, the conference theme is "The Green of Green" because it focuses on the nuts and bolts of incorporating green building practices into a business plan: project management, the legal issues and liabilities surrounding green building, energy tax credits and incentives, and more.
In addition to theNAHBNationalGreen BuildingAwards for outstanding new homes, remodeling projects and developments, highlights of the conference include:
- Keynote speaker JoelMakower, executive editor of GreenBiz.com and author of more than a dozen books, including Strategies for the Green Economy.
- The Annual Tour of Green Homes. Dallas area builders and remodelers will show off their latest green projects, some under construction and some completed.
- Plan reviews and educational sessions-not only on business management topics but also on marketing, building science and technology targeted to builders, remodelers and developers.
- Networking opportunities and exhibits from the industry's most prominent green suppliers and manufacturers.
"I believe that this year's conference is simply a can't-miss event for our industry-especially for those of us looking for new tools that will allow us to remain profitable in the current economic climate-and be ready to be green as the demand for housing returns," Theunissen says.
Additional information and registration is available at www.nahb.org/GreenBuildingConference. Conference corporate sponsors include the Propane Education and Research Council, Stock Building Supply, Wells Fargo Home Mortgage and Whirlpool.
NAHB Chairman Issues Statement on Proposal to Cut Mortgage Interest Deduction Benefits
On Feb. 26, Joe Robson, chairman of the National Association of Home Builders, issued the following statement on President Obama's proposal to reduce the value of the mortgage interest and real estate tax deductions for home buyers and homeowners in order to pay for an expanded health care initiative:
"With the housingmarket still reeling fromits worst downturn since the Great Depression, this is not the time to talk about raising taxes on home buyers and homeowners. This proposal will increase the cost of housing for many middle-class families, particularly in high-cost areas such as California and the Northeast, which will only further undercut the housing market, exert more downward pressure on home values andwork against the President's efforts to stabilize housing and turn this economy around.
"The proposed budget would also tax a 'carried interest' as ordinary income, which could significantly impact the multifamily and commercial real estate sectors at a time when they are already experiencing a severe downswing. At this critical point in the recession, we should be doing everything we can to stimulate demand in housing and avoid proposals that would reduce housing affordability and further destabilize prices. "The notion of 'robbing Peter to pay Paul' just won't work. Not when the stakes are so high with our economy. This week alone, existing home sales dropped another 5.3 percent and new-homes sales plunged 10.2 percent. Inventory of unsold homes is at an all-time high. Financing health care reforms by chipping away at the mortgage interest and real estate tax deductions is certainly not the answer. This will only hurt the ailing housing market and U.S. economy."
Home Buyer Tax Credit Could Create 255,000 Jobs
The home buyer tax credit, which is an integral part of the economic stimulus legislation, will result in nearly 500,000 additional home sales and create 255,000 new jobs in the year ahead, according to research conducted by the National Association of Home Builders FNAHBG.
"The tax creditwill get prospective buyers back into the housing market ... and stimulate activity throughout the economy," saysNAHB President and CEO Jerry Howard.
Increasing home sales, Howard added, will help to stabilize home values, slow the rate of foreclosures and shore upmortgage portfolios held by financial institutions, all of which will bolster confidence generally and trigger even more economic activity.
In addition to the 255,000 jobs created during the first year, NAHB estimates that the additional halfmillionhome sales will generate:
- $12.3 billion in wages and salaries,
- $9.7 billion in net business income,
- $6.6 billion in federal taxes, and
- $2.1 billion in state and local taxes.
But the ripple andmultiplier effect doesn't stop there. NAHB research shows that the tax credit would result in $7.4 billion in economic activity outside the construction sector, including $4 billioninbroker services, $2.5billioninspending related to sales transactions and $350million in spending for property improvements.
