February 2014
Economic Outlook Good for Our Region but Certain Challenges Remain Missouri Legislative Day March 5 Page 3 HBA appoints committee chairs Page 5 HBA Hosts 2014 Opportunity Forecast Page 6 State of the State Addresses Page 7 NAHB 2014 Priorites Page 12
The Home Show returns with Jennifer Bertrand March 28-30 See more on pages 8 and 9.
HBA members gathered for the 2014 Economic Forecast on January 15 More than 130 people attended the HBA’s Economic Forecast Breakfast on January 15 at the Overland Park Convention Center to hear from David Crowe, Chief Economist and Senior Vice President, the National Association of Home Builders, and Chris Kuehl, Co-founder and President, Armada Intelligence. Crowe confirmed that there are clear signs of a turnaround with the data showing consumer confidence on the rise and a looming demand from families who want to move into a new home. The data show that Kansas City is faring better than many other communities across the country. With regard to single-family starts, Kansas City is at 36 percent of what is considered normal. Crowe predicts that Kansas City will reach normal levels by the end of 2015. One of the biggest challenges facing the industry is not the price of credit but the availability of credit. Kuehl confirmed much of Crowe’s data regarding consumer confidence, employment and household balance sheets. Crowe stressed that unemployment is a key indicator of the recovery, expressing particular concern for employed workers who are worried about becoming unemployed in the near future. These workers are much less likely to make
big ticket purchases, such as buying a new home. Kuehl also recognized that it has become much harder to find people to work in construction and there is real uncertainty about where the next generation of workers will come from.
David Crowe, NAHB Chief Economist
Start Spring at the Home Show The original Kansas City Home Show returns, March 28-30, to Bartle Hall. It’s been a Kansas City tradition for sixty-six years and together with the Flower, Lawn and Garden Show showcases new opportunities and choices for homeowners to get a jump on spring home and garden projects. Headlining the event is HGTV Star Monica Pedersen, interior design expert, HGTV Dream Home Giveaway host, and author of Make It Beautiful. She will share her expertise in a variety of topics including interior design, design trends, how to add value to your home, staging for the
real estate market, or simply inspiring doit-yourselfers to “Make it Beautiful” on any budget. HGTV’s Cari Cucksey, host of Cash & Cari, also will shine on the Home Show Stage. Cari is an “antiques matchmaker” who gives dusty relics a new lease on life. In addition to hosting her show, Cari runs RePurpose Estate Services, operates the RePurpose Shop, and refurbishes just about anything she can get her hands on. And Kansas City’s own Jennifer Allwood will take the spotlight on the stage. Jennifer is a professional faux finisher and owner of The Continued on page 8
www.kchba.org | Volume 20, No. 2 | February 2014
Feb. 4-6
February Calendar Education and Training Sessions Offered 2014 NAHB International Builders’ Show
Feb. 18, 11:30 am
Board of Directors Meeting
Feb. 19, 9 a.m.-Noon
KCRAR Residential Contract Review
Feb. 20, 9 a.m.-5 p.m.
The Basics of Building
Feb. 26 – 28 9 a.m.-5 p.m.
Certified Sales Professional (CSP)
Take advantage of education classes through the winter and spring months that are designed to provide members with information and knowledge to succeed in the home-building industry. The HBA has organized sessions ranging from the basics of construction to business management and sales. Some courses go toward professional designations from the National
Association of Home Builders as well as for contractor licensing in many local jurisdictions. A number of the sessions are sponsored by the HBA’s Sales and Marketing Council. To register for a class or for more information, please contact Andrew McKeegan at (816) 942-8800 or andrew@kchba.org. You can also register at www.kcbha.org.
February KCRAR Residential Contract Review Wednesday, February 19 Understand the Kansas City Regional Association of Realtors’ (KCRAR) Residential Construction Contract inside and out and get 3 continuing education credits in the process. Time: 9:00 to 12:00 a.m. Cost: Free to HBA and KCRAR Members. $35 for nonmembers Location: HBA
For more information or to register for any event, go to www.kchba.org or call 816-942-8800
The Basics of Building Thursday, February 20 Understand the residential construction process from the ground up! This class is perfect for any realtor, vendor, supplier, broker, retailer, or employee of a builder/remodeler who needs to know what it takes to build or remodel a home. Time: 9:00 a.m. – 5:00 p.m. Cost: $200 (members), $225 (nonmembers) Location: HBA
Certified Sales Professional (CSP) Wednesday, February 26 – Friday, February 28 This 3-day, professional-level course is designed for specialists in new home sales. Gain a broad understanding of the home building business, consumer psychology and learn advanced techniques used by real estate veterans for greeting, closing and overcoming objections. Time: 9:00 a.m. – 5:00 p.m. Cost: $395 (members), $420 (nonmembers), Lunches Included Location: HBA
March Education at the 2014 Spring Home Show Friday, March 28 – Saturday, March 29 See details on page 9 Location: Bartle Hall Convention Center, 301 West 13th Street, Kansas City, MO, Classrooms A, B, C
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February 2014 | Volume 20, No. 2 | www.kchba.org
Missouri Legislative Day Set for March 5: Register Today Under the statewide organization, the Home Builders Association of Missouri (HBAM), KCHBA members from across the state will travel to Jefferson City on March 5, 2014 for face-to-face meetings with their elected representatives. The event provides KCHBA members with the opportunity to learn more about legislation impacting the home building industry, build relationships with their elected representatives and network with fellow HBA members from around Kansas City
and the state. Missouri Legislative Day is a long-standing tradition that serves to remind lawmakers that we are paying attention to what is happening at the state level. With much at stake for the home building industry, it is critical that lawmakers hear the HBA member’s perspective on issues currently being debated in the General Assembly. In the coming weeks and months, lawmakers will consider reforms to the state tax code, debate workforce issues, and undoubtedly face a renewed interest in establishing a uniform state-wide fire and building code and sprinkler systems. To register for Missouri Legislative Day, visit www.kchba.org.
2013 Missouri Legislative Day: Matt Earnst, Brenner Holland, Chris Ragland, Tommy Angotti, Senator Ryan Silvey, George Schluter, and Misty Hanson
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www.kchba.org | Volume 20, No. 2 | February 2014
Parade Entries Are Going Strong!
COMMITMENT.
Don’t Miss February Deadlines This Spring Parade of Homes, April 20May 5, promises to be the biggest in recent years with early entries off to a good start with 351 registering to date.
for the area’s premier new homes, home builders and communities. Every spring consumers use the Parade to see the latest in new home design and innovations throughout the metropolitan area.
For 52 years the Home Builders Association of Greater Kansas City has presented this annual event as a showcase
Parade entry forms are online at kchba.org. Contact Gina Battle at gina@kchba.org or 816-733-2219.
Bank of Blue Valley approved over $50 million in commitments to the local residential construction and development community last year alone. See how we can commit to your business today!
WWW.BANKBV.COM 913.234.2207 HBA members attending the panel discussion included Justin Pfeifer, Jerry Braklow, Patrick Willis, Kevin Stallings, Sue Sheridan, Russ Groshans and Damon Comerio
Parade Boosts Business HBA builder members shared their strategies for maximizing the Parade of Homes for marketing their business and attracting new homeowners. Panelists included: HBA President Chris Ragland, Homes by Chris, LLC, Justin Pfeifer, Pfeifer Homes, Russ Groshans, Casa Bella Construction, and Richard “Rocky” Rhodes, Allure Luxury Homes.
Mather Brothers Earn Status with NAHB
We proudly support the home building industry.
Mark Mather has been awarded the status of NAHB Life Director and Brian Mather has met requirements to be awarded the Senior Life Director. Both will be awarded at the 2014 International Builders’ Show Board meeting in Las Vegas. 4
Brian Mather
Mark Mather
February 2014 | Volume 20, No. 2 | www.kchba.org
Spike Award
Built, Backed and serviced like no other windows.
HBA Appoints Committee Chairs
*
The HBA offers opportunities for members to engage as volunteers in a variety of areas. The following is the 2014 leadership of HBA committees. Government Affairs Harold Phelps, Phelps Engineering (KS) Brenner Holland, Hunt Midwest Real Estate Development (MO) HBA-PAC Bob Frost, Frost Construction
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Sales and Marketing Council Roy Ragland, Homes by Chris Jennifer Mann, Hunt Midwest
Craig Eymann, Ambassador Construction, received the Red Spike Award for recruiting 100 to 150 new members.
*Visit andersenwindows.com for warranty details. “Andersen” and all other marks where denoted are trademarks of Andersen Corporation. ©2013 Andersen Corporation. All rights reserved.
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Parade Committee Patrick Willis, Willis Construction Justin Pfeifer, Pfeifer Homes
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www.kchba.org | Volume 20, No. 2 | February 2014
TELL YOUR STORY HBA Hosts “2014 Promote your community or new homes to over 200,000* new home shoppers each week that read The Kansas City Star’s real estate sections either in print or online. Call for details 816-234-4739
Opportunity Forecast”
IN
* Source: Scarborough research, August 2013
A sold out crowd attended the “2014 Opportunity Forecast: Permits, Lots and Lending”. Attendees came away an understanding of the local housing market and land development opportunities, and banking interests in the Kansas City metropolitan area. The event showcased a panel of speakers including, Frank Lenk, Director of Research Services, Mid-America Regional Council, Dan Whitney, President, Landmarketing and Richard Holtcamp with Bank of Blue Valley. (pictured here in order left to right with Wilson Siemens, New Bedford Land Development Company)
To advertise, call your account executive or Sharon Horgan at (816) 234-4739
Nationwide Housing Production Up
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Following an unusual surge in housing starts in November, nationwide housing production fell 9.8 percent to a seasonally adjusted annual rate of 999,000 units in December, according to newly released figures from the U.S. Department of Housing and Urban Development and the U.S. Census Bureau.
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“Total housing starts of just under 1 million units in December was the third-highest monthly level of production in 2013,” said Rick Judson, chairman of the National Association of Home Builders (NAHB) and a home builder from Charlotte, N.C. “This rate is in line with our builder surveys, and tells us we are seeing a return to trend after a strong November.” “Last year was a good year for home building, with overall production up 18 percent from 2012,” said NAHB Chief Economist David Crowe. “As pent-up demand is unlocked and the labor market improves, we anticipate that 2014 should be an even better year for home construction. That’s good news for economic growth, as each new home that is built creates three
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full-time jobs and contributes to the tax base of local communities.” Single-family housing starts fell 7 percent to a seasonally adjusted annual rate of 667,000 units in December. Except for November, this was the highest monthly total for single-family starts in 2013. Meanwhile, multifamily starts fell 17.9 percent to 312,000 units in December. Regionally in December, combined singleand multifamily housing production rose 15 percent in the West but fell 33.5 percent in the Midwest and 12.3 percent in the South. Production was unchanged in the Northeast. Overall permit issuance fell 3 percent to 986,000 units in December. Single-family permits dipped 4.8 percent to 610,000 units from a strong pace the previous month, while multifamily permits were unchanged at 376,000 units. The Northeast and West posted gains of 11.2 percent and 10.5 percent in permitting activity for December, while Midwest and South registered declines of 18.8 percent and 7.4 percent, respectively.
February 2014 | Volume 20, No. 2 | www.kchba.org
Governors Give State of the State Addresses Governors Jay Nixon and Sam Brownback set the tone for the 2014 legislative session with their State of the State addresses in January. Governor Nixon highlighted a reduction in the unemployment rate since he took office and the nearly 44,000 new jobs created since last year. He also highlighted maintaining the state’s AAA credit rating and limiting the number of state employees. Looking forward, Governor Nixon promised a balanced budget that “holds the line” on taxes. He also pledged to simultaneously increase the education budget by $493 million. As expected, the Governor urged lawmakers to expand Medicaid under the Affordable Care Act, which lawmakers have been very reluctant to do. Legislative activity is heating up in the General Assembly. Republican lawmakers are once again working on legislation to cut taxes or reduce tax rates. Some expect a tax cut bill that is more scaled back than the bill that passed the General Assembly last year but was vetoed by the Governor. House Speaker Tim Jones has made passing a “right to work” (RTW) bill his top priority even though Governor Nixon has stated on several occasions that
he would veto it. The first hearing on a RTW bill was already held in the House Workforce Development Committee. Governor Sam Brownback held his State of the State address on January 15 where he pledged $2 million to address a shortage in moderate income housing in rural areas. He also promised to develop a comprehensive water infrastructure policy, expand all-day kindergarten and increase funding for programs to attract doctors to rural areas of the state. Overshadowing the Governor’s address, however, is the much anticipated Kansas Supreme Court’s decision in the Gannon v. State of Kansas case, which may or may not order the legislature to increase education funding or the base state aid per pupil by close to $500 million. The Governor argued in support of the current funding levels. A court ruling to increase school funding would create a significant obstacle for the Governor and legislature to invest in new and existing programs.
Design with natural gas in mind. The most successful builders know that natural gas homes are instantly more attractive to buyers. When you build homes equipped with natural gas and weatherized with energy‑efficient windows and insulation, you can reduce your customers’ utility bills year‑round and help boost your sales numbers today. For more on how to use natural gas to turn prospects into buyers, email lyn.leet@kansasgasservice.com or call (913) 344‑8808. www.kansasgasservice.com
The Kansas Legislature has been slow moving. The high point has been the unveiling of the newly restored State Capitol building. The restoration cost about $330 million and took 13 years to complete.
Make sure you take advantage of NAHB’s valuable resources.
This month’s tip is the Builder 20 Club because no one speaks your language like others in your field. The 20 Clubs is a one-of-a-kind networking tool for top executives of NAHB member firms comprised of similar builders, remodelers and other industry professionals from non-competing markets. Each club meets twice a year to share their wisdom and learn ways to improve operations and bottom lines. Members share and compare financial information, look for trouble spots and offer each other advice on how to increase profit ratios and general performance. It’s an unbeatable concept that is available to: Small-Volume and Production Builders Custom and Semi-Custom Builders Remodelers
Resource Tip
Statistics indicate that 20 Club members perform better than non-members in financial growth, operational systems and long-term success. Eligible participants must be NAHB members in good standing who complete at least one project per year and are the owner, principal or president of their company with at least 5% ownership. Join the Club and experience the Power of 20 today to share what you know, and gain what you need. For more information or inquiries about this product, contact: Kimberly Bailey at 800-368-5242 x8255 or kbailey@nahb.org. 7
www.kchba.org | Volume 20, No. 2 | February 2014
HBA Offers Extensive Education Opportunities at the Spring Home Show Furniture
•
Flooring
•
Appliances
•
The HBA will offer a dynamic education program on Friday, March 28 and Saturday, March 29 at the Spring Home Show at Bartle Hall. For the first time, the HBA will be filling the classrooms on the first floor of Bartle Hall with International Building Show (IBS)style sessions that cover a wide range of topics, such as marketing to the new home buyer, design trends for 2014 and how to build energy efficient homes on a budget. Instructors for these classes are nationally-recognized experts in their field and have presented at IBS. On Saturday, March 29, the HBA will offer a day-long class on framing to the 2012 International Residential Code and an additional training on OSHA’s fall protection standard. The intention with these classes is to reach construction crews who are usually unable to attend HBA classes dur-
Electronics
Nebraska Furniture Mart provides an unrivaled selection of products and services under one roof, making it your one-stop solution for all of your building or remodeling needs. From minor upgrades to custom and professional applications, we have the right prices, superior designs, and professional installation capabilities. Visit us for all of your Furniture, Flooring, Appliances, Electronics, Lighting and Countertop needs. Store Location: I-435 & State Ave. West • Kansas City, KS Convenient Hours: Mon – Sat: 10am to 9pm, Sun: 10am to 6pm Builder Sales: 913-288-6299 • 800-407-5000 Kitchen Design Studio: 913-288-6124 • Electronics Design/Installation 913-288-6500 • Interior Design Gallery: 913-288-6354 ©2014 Nebraska Furniture Mart, Inc.
ing the work week. These Saturday classes provide an opportunity for them to polish their knowledge and skills. Last, but definitely not least, Elliot Eisenberg, former Senior Economist with the National Association of Home
Builders, will provide an economic outlook on Friday, March 28 at 3:30 p.m. Eisenberg is an acclaimed economist and public speaker who has enlightened and entertained HBA members for many years. The HBA is happy to provide this program free of charge to its members. To register for any of the Spring Home Show classes, please contact Andrew McKeegan at andrew@kchba.org or visit kchba.org.
Start Spring at the Home Show
COUNT ON US 1,350 locations. All 50 states. 300 showrooms. 19,000 associates. 60 years in business. LIGHTING | fIxTures | cabINeTs fauceTs | pLumbING
Brush, Continued from page 1 Magic Inc. She is “making the world pretty…one room at a time” in houses all over the Kansas City metro, specializing in faux finishes, cabinets, children’s rooms, garage doors, and furniture.
Lenexa, Ks (913) 752-5660 Topeka, Ks (785) 354-4305 Independence, mO (816) 252-0060 Downtown Kansas city, mO (816) 842-1008
Bartle Hall will be teeming with new home products and services, decorating, design and building demonstrations, the latest remodeling ideas, premier land-
FERGUSON.COM ©2014 Ferguson Enterprises, Inc.
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scaping and special attractions. Home Show organizers consistently enhance this Kansas City tradition. “This is the place to see, learn about and buy the latest home and garden products and services from more than 200 companies in one place,” said Cara Thomas, Home Show Director. “Everyone should come out to see this great mix of new and returning exhibitors and get inspiration for their homes!”
February 2014 | Volume 20, No. 2 | www.kchba.org
Jennifer Bertrand, HGTV Design Builders Invited to See the Latest Products at Trade Show Star Winner, Returns to Emcee the While the Home Show gears up for the consumers, HBA members will host a trade show for builders to see the latest and greatest products from local suppliers, Friday, March 28, 9 a.m.-5 p.m. at Bartle Hall. This sidebar to the Home Show is in tandem with a host of education opportunities being offered to builders at no charge. The purpose according to Phil Yancey, Membership Manager, is to give builders an opportunity to talk with associates one-on-one, member to member. “This is the first time the HBA has offered so much to see and do for builders at a Home Show,” said Yancey. “Builders will be
SPACES Main Stage
able to learn the latest in education and see the latest products for the homes they are building.”
Back by popular demand is the return of Jennifer Bertrand. Jennifer will bring her contagious enthusiasm and innate creativity to the Spring Home Show Stage with her design tips and as the emcee for the activities on stage. Considering her work has been featured nationally in both premium design markets and local art galleries, her attitude toward design is extremely down-to-earth and approachable. She believes design should reflect the homeowner’s lifestyle and should encourage living and enjoyment of the space rather than just a lovely atmosphere.
Space Still Available for Exhibitors and Sponsors Be sure to check out our Spring Home Show at www.KCHomeShow.com and spread the news about this exciting home & garden event. The floor is filling up quickly, but there is still time to participate! For exhibit and sponsorship opportunities please visit kchomeshow.com or contact Cara Thomas at cara@kchba.org or 816.733.2217.
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www.kchba.org | Volume 20, No. 2 | February 2014
Anniversaries
Welcome New Members
The strength of an association is in its membership and a thank you goes out to all of those members who continue to support the HBA.
Let’s make them feel at home!
1983 Jim Haas Builders, Inc. Price Brothers Residential Inc 1986 Segebrecht Charles Construction 1987 Top Master 1988 Bickford & Company, Inc. 1989 Pfeifer King Building Corporation 1990 United Heating, Cooling & Plumbing Inc. 1997 Secured Title of Kansas City 2000 J Davis Drywall LLC 2001 Royal Metal Industries, Inc. 2002 Gahagan & Eddy Building Co. LLC
Scott Bray Braco Sales, Inc. 1414 Wyoming St. Kansas City, MO 64102 (816) 471-5005 scott@bracostone.com scott@bracostone.com
Mariner Real Estate Management PO Box 29188 Parkville, MO 64152 (816) 734-8790 jason_arklyn@hotmail.com www.arklynhomes.com
Jeffrey R. Siegel Siegel Tax Law 3965 W 83rd St #337 Prairie Village, KS 66208 (913) 735-4829 jeff@siegeltaxlaw.com www.siegeltaxlaw.com
Kathy Moore Metro Media Publishers 4210 Shawnee Mission Pkwy, Suite 314a Fairway, KS 66205 kmoore@metromediapublishers.com
2006 Kirkwood Realty Co., LLC Kreimendahl Painting Window World of KC 2009 Rosehill Gardens, Inc 2010 Associated Air Products Integrated Electronics, Inc. Legacy Custom Homes LLC 2011 Accent Doors of Kansas City 2012 Alenco, Inc. Norton & Schmidt Consulting Engineers, LLC 2013 Ameriprise Financial Classic Buildings Colt Industries, Inc. Stonecreek Custom Homes Thomson Homes LLC
Steve Snook Re/Max Mid States Region 2860 NE Kendallwood Pkwy Gladstone, MO 64119 (816) 459-7740 steve.snook@remax.net www.remax.com
www.probuild.com
Proud Sponsors of the HBA Since 1990
LOCAL EXPERTISE. NATIONAL REACH. ProBuild is your complete solution for all your building needs. With high quality lumber, a robust selection of building products and installed lumber services, we can provide you with the best materials for your home.
WINDOWS & DOORS
But ProBuild doesn’t stop there. We also offer a full line of windows and doors to put the final touches on a product you will be proud to put your name on. If you need it, we have it. Please call or come in today with all of your building needs.
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PROBUILD LUMBER 103 SE OLDHAM PKWY LEES SUMMIT, MO 64081 816.246.5373
PROBUILD DOOR & MILLWORK 1227 E MARTHA TRUMAN RD E 119TH STREET, SUITE 400 GRANDVIEW, MO 64080 816.765.4080
ENGINEERED WOOD
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February 2014 | Volume 20, No. 2 | www.kchba.org
HBA Members are Off to IBS The HBA will be well represented at the National Association of Home Builders (NAHB) and the National Kitchen & Bath Association (NKBA) joint shows at the International Builders’ Show (IBS) and the Kitchen & Bath Industry Show (KBIS). This first annual Design & Construction Week takes place February 4-6, 2014 in Las Vegas! For more information go to www.buildersshow.com. Look for fellow members from the following companies: Allure Luxury Homes Ambassador Construction Company Inc. Ashner Construction Company Inc. Aspen Homes B L Rieke Custom Homes Inc BMW Communities Inc Bodine-Ashner Builders Inc. Bovard Insurance Group Bryant/Ratliff Builders Inc. Builders Development Corporation CrossFirst Bank Cumberland Properties Inc. Dreams & Design Building Dusselier & Marks Homes Inc. Dusty Dahmer Construction E & M Consulting Inc. ER Marketing
Kansas City Building Supply Ken Praiswater Construction Kevin Higdon Construction Kitchens & Baths by Briggs Lambie Custom Homes Inc. Mather Development McCray Lumber and Millwork Midwest Fireplace Neighbors Construction Company Inc. Norburg Contracting Inc. Northcraft Flooring & Granite Design Owens Built Properties Inc. Pacific Mutual Door & Window ParkView Homes LLC Phelps Engineering Inc Precision Contracting & Development Inc Provident Ventures Quigley Custom Homes LLC R & S Home Builders Inc Reece & Nichols Richard Mather Builders Inc. Roeser Homes LLC SAB Homes Inc. Schlagel & Associates P.A. Singleton Construction LLC Starr Homes LLC Stewart Title of Kansas City Stoneworth Building Products
Ernst Brothers Home Construction Inc. Extraordinary Homes Factory Direct Appliance Frost Construction Company Gary Kerns Homebuilders LLC Graham Construction Company Gregory Allen Enterprises Inc. GWS Inc. Haynes Equipment Co. Inc. HBA of Greater Kansas City Henges Insulation Hoffman Construction Inc Homes by Chris LLC Homoly Construction Hunt Midwest Residential LLC Inspired Homes LLC J.S. Robinson Fine Homes James Engle Custom Homes Joseph Lane Homes
BuildingBusinessNews THE OFFICIAL PUBLICATION OF THE HOME BUILDERS ASSOCIATION OF GREATER KANSAS CITY February 2014 • Volume 20 Issue 2 Copyright 2014 Published by the Home Builders Association of Greater Kansas City 600 E 103 Street, Kansas City, MO 64131 (816) 942-8800 Executive Vice President Sara Corless Editor Stephanie Stollsteimer Contributing Writer: Beatriz Ibarra Graphics Karla Peterie, Creative Services 2014 Executive Committee Home Builders Association of Greater Kansas City President Chris Ragland Vice President Mark Mather Secretary/Treasurer Brenner Holland Associate Representative Kevin Kirtley Immediate Past President Fred Delibero
To subscribe to Building Business News call (816) 733-2224 To advertise in Building Business News call (816) 942-8800 For change of address requests please fax changes to (816) 942-8367 or call (816) 942-8800 For more information, visit the HBA online at www.kchba.org
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Summit Custom Homes LLC Sunlite Science & Technology Inc. Surface Center Interiors The National Home Building Co. The Screen Warehouse Wilson Lighting Wolf Creek Homes LLC
Remodeling Index at Historic High According to the National Association of Home Builders (NAHB), the Remodeling Market Index (RMI) held steady at 57 in the fourth quarter of 2013. This is the same level as the third quarter of 2013 and the highest reading since the first quarter of 2004. An RMI above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it is lower. The overall RMI averages ratings of current remodeling activity with indicators of future remodeling activity. “The remodeling industry ends 2013 on a high note as remodeler confidence holds steady at a historically high level,” said NAHB Remodelers Chairman Bill Shaw, GMR, GMB, CGP. “We expect to keep this positive momentum going in 2014 as more home owners continue to take on remodels and repairs that had been postponed in the downturn.” The RMI’s future market conditions index rose from 56 in the previous quarter to 58, the highest reading since the inception of the series in 2005. Three of the four major components of the RMI’s future market conditions index increased in the final quarter of 2013. Calls for bids increased from 56 to 59, the amount of work committed for the next three months from 52 to 54 and appointments for proposals from 55 to 59. The backlog of remodeling jobs fell one point to 59. The current market conditions component of the RMI declined to 56 this quarter. “Steady existing home sales, historically favorable interest rates for home buyers and rising home equity have combined to release some of the pent up demand for home remodeling from the past few years,” said NAHB Chief Economist David Crowe. For more information about remodeling, visit www.nahb.org/remodel.
www.kchba.org | Volume 20, No. 2 | February 2014
NAHB 2014 Priorities
Thanks to These HBA 2014 Sponsors
The National Association of Home Builders works year-round on policy issues that are important to HBA members nationwide and key to a strong housing industry. The following are the top 10 priorities in 2014. 1. Protect the Mortgage Interest Deduction This cornerstone of American housing policy has been in place since the inception of the tax code 100 years ago and supports the aspirations of families at all income levels to become home buyers. More than 33 million home owners directly benefit from the mortgage interest deduction and two-thirds of the benefit goes to middleclass home owners who make less than $200,000.
Platinum sponsor
Bank of Blue Valley GOLD sponsors
Capitol Federal Bank Factory Direct Appliance
Phelps Engineering ProBuild
First Federal Bank
Shamrock Cabinets
Henges Insulation
Sun Lumber Co.
K & E Flatwork
United Heating, Cooling & Plumbing
Kenny’s Tile & Flooring
2. Resolve Foreclosure and Appraisal Problems Large numbers of foreclosures nationwide are driving down home values preventing a full-fledged housing and economic recovery. The large numbers of foreclosures have led to problems in appraisals. Major reforms in appraisal practices and oversight are needed to ensure that appraisals accurately reflect true market values and don’t contribute to price volatility, impede the economic recovery or harm aspiring home owners and move-up buyers.
Wells Fargo
McCray Lumber & Millwork
Northcraft Flooring & Granite
Nebraska Furniture Mart
Star Drywall & Insulation
Owen Lumber Co.
Kansas City Star
3. Maintain Federal Support for Housing Finance System A sound housing finance system that provides a stable and affordable supply of credit for home buyers and rental housing is essential to ensure a healthy housing market, spur job creation and maintain a strong and resilient economy.
Silver sponsors
Ferguson Enterprises, Inc.
Kansas Gas Services
Stewart Title
Missouri Gas Energy Bronze sponsors
Building Solutions
Kitchens & Baths by Briggs
Carpenters District Council
Locks & Pulls
Commerce Bank
North American Savings Bank
Complete Home Concepts Continental Title Company CrossFirst Bank
Pacific Mutual Door & Window
First American Title
Pella Products of Kansas City
Hermes Landscaping
ProSource of Lenexa
James Hardie Building Products
Secured Title of Kansas City
Kansas City Title
4. Preserve Affordable Downpayments and Mortgages NAHB has been working nonstop to ensure that the new rules now under consideration, which will define the mortgage markets for years to come, provide long-term liquidity and stability for the industry’s future.
Western Chandelier 12
5. Fight Onerous Regulations that Hurt Home Builders, Remodelers and Consumers NAHB is in the forefront in preventing expensive, pointless regulations from impeding home building and remodeling and adding unnecessary costs to consumers.
6. Ensure an Adequate Supply of Reasonably Priced Credit for New Home Production Commercial banks and savings and loan institutions have traditionally provided the lion’s share of housing production credit for the residential construction industry, which is known as acquisition, development and construction (AD&C) funding. But even as housing markets heat up across the country, financial and regulatory constraints are preventing these lenders from providing the amount of credit that would be typical given current economic conditions. 7. Recognize Housing’s Important Role to the Economy Considering the enormity of the total number of jobs attached to housing, a sector that normally accounts for more than 17 percent of the nation’s Gross Domestic Product, now is hardly the time to step back from the nation’s longstanding commitment to homeownership. 8. Defend the Low Income Housing Tax Credit The demand for affordable housing is acute and far exceeds the ability of LIHTC projects to keep pace. The program is essential to address the shortage of affordable housing options in our cities and towns. 9. Enact Comprehensive Immigration Reform It is estimated that more than 20 percent of the building industry’s workforce is foreign-born, making the immigrant population key to meeting housing demand and sustaining growth in the industry. 10. Use All Legal Means Necessary to Protect Property Rights NAHB’s proactive litigation efforts have forced governmental bodies and agencies at the state and federal levels to scale back or entirely eliminate efforts to limit or stop development on countless parcels nationwide.
February 2014 | Volume 20, No. 2 | www.kchba.org
Member Q&A
NAHB Wins Legal Victory for Businesses
Sara Corless Executive Vice President scorless@kchba.org, 816-733-2216 Beatriz Ibarra The National Labor Relations Board Vice President of Government Affairs bibarra@kchba.org, 816-733-2237 (NLRB) announced that it will not appeal Gina Battle a U.S. Court of Appeals decision that inDirector of Parade of Homes validated the NLRB’s Poster Rule. The gina@kchba.org, 816-733-2219 Poster Rule would have required employMarcia Jurgens ers to post a notice of employee unionizaPermit and Accounting Mgr. tion rights in the workplace. The National marcia@kchba.org, 816-733-2215 Association of Home Builders, as well as Stephanie Stollsteimer other business organizations, is a memDirector of Marketing & Communications ber of the Coalition for a Democratic stephanie@kchba.org, 816-733-2213 Workplace, which maintained that the Andrew McKeegan poster rule violated free speech rights, and Association Services Manager Andrew@kchba.org, 816-733-2224 amounted to little more than an imposed advertisement for union membership. Phil Yancey Membership Manager NLRB will not be able to impose this rule Phil@kchba.org, 816-733-2245 because it has been stayed by a temporary Dawn Allen injunction. Please contact Beatriz Ibarra Executive Assistant/Communication at bibarra@kchba.org with any questions. and Events dawn@kchba.org, 816-942-8800 Cara Thomas Director, Home Show cara@kchba.org, 816-733-2217
Name: Jeremy Beachner Title: Project Manager/Kitchen Designer Business: Shamrock Cabinet How did you get into the business? I have grown up around custom cabinets and Shamrock my whole life so it was a natural progression for me. You could say it’s in my blood. What are the goals for your business? Shamrock’s goal for this year is to keep improving for current customers and to gain more market share. We came out of the recession stronger and smarter and look forward to increasing production. What do you like to do outside of work? I enjoy spending time with my friends and family. Where do you like to go for fun? Eating out is my favorite thing to do. I love to go out and experience new restaurants. What is something people don’t know about you? I can cook! At least so I am told. I am my biggest critic. What is your favorite television show? Right now, thanks to Netflix, Arrested Development. Internet site? Probably Food Network, and um….www.shamrockcabinet.com … (shameless plug)
HBA Staff
What is your favorite movie? Shawshank Redemption What is your prediction for the home building industry? I think Shamrock sees steady consistent growth for the next few years. Nothing dramatic in terms of an upswing but we feel as if the companies that have made it through the recession and stronger and smarter and will help the industry grow.
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What is your favorite HBA event/meeting experience? It’s hard to beat the awards banquets. Fun, food, and drinks, what else is there? It is fun to meet my customers outside the normal business setting. Why are you a member of the HBA? Shamrock has been involved as a member long before I started here. Erik Blaney has challenged me to take over as Shamrock’s representative. I know from experience that the HBA has made a very positive difference for Shamrock. Erik pushes the benefits of networking and I know that most of the benefits on the surface seem great but that the more you get involved, the greater the opportunities. I am looking forward to attending meetings, getting to know everyone and learning as much as I can from the HBA.
HengesInsulation.com • 913-764-4600 13
www.kchba.org | Volume 20, No. 2 | February 2014
Housing Markets Continue to Show Gradual Improvement Markets in 56 out of the approximately 350 metro areas nationwide returned to or exceeded their last normal levels of economic and housing activity, according to the National Association of Home Builders/First American Leading Markets Index (LMI), in January. This represents a net gain of two from the previous month. The index’s nationwide score of .86 indicates that, based on current permits, prices and employment data, the nationwide average is running at 86 percent of normal economic and housing activity. “Forty-five percent of metro areas are recovering at a faster pace than the nation as a whole, with smaller markets leading the way,” said NAHB Chief Economist David Crowe. “Of the 56 markets that are at or above normal levels, 48 of them have populations that are less than 500,000, and many of these local metros are fueled by a strong energy sector, which is producing solid job and economic growth.” Baton Rouge, La., tops the list of major metros on the LMI, with a score of 1.42—
their annual average over the last period of normal growth. For single-family permits and home prices, 2000-2003 is used as the
or 42 percent better than its last normal market level. Other major metros at the top of the list include Honolulu, Oklahoma City, Austin and Houston, Texas, as well as Harrisburg, Pa., and Pittsburgh— all of whose LMI scores indicate that their market activity now exceeds previous norms.
Single Family Housing Finishes 2013 with 24 Percent Gain Over 2012 Single family housing experienced continued growth in 2013 over 2012 and reached the highest number since 2007 according to the Home Builders Association of Greater Kansas City’s (HBA) monthly Residential Building Permit Statistics report. The year ended up 24 percent over last year with 4,087 permits compared to 3,299 in 2012. Including multi-family units, the total for 2013 was 6,966 compared to 5,074 in 2012 for a 37 percent increase.
The LMI shifts the focus from identifying markets that have recently begun to recover, which was the aim of a previous gauge known as the Improving Markets Index, to identifying those areas that are now approaching and exceeding their previous normal levels of economic and housing activity. More than 350 metro areas are scored by taking their average permit, price and employment levels for the past 12 months and dividing each by
last normal period, and for employment, 2007 is the base comparison. The three components are then averaged to provide an overall score for each market; a national score is calculated based on national measures of the three metrics. An index value above one indicates that a market has advanced beyond its previous normal level of economic activity.
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“We crossed the threshold of building 4,000 homes last year and that’s cause for the local economy to celebrate,” said HBA Executive Vice President Sara Corless. “As we look to 2014 buyers will be pleased they have greater choice from a more balanced new home inventory. Builders will be watching pending contract and sales activity going into the spring for clues about what this year will bring.” Overland Park led the metropolitan area with a total of with 1,562 total units which included 422 single family units and 1,140 multi-family. Kansas City, Missouri followed with 1,502 residential units in its three-county reach. Of those, 675 were single family units and 827 were multi-family. Next was Olathe with 560 total units with 528 single family and 32 multi-family. The single family growth among the larger counties was led by Johnson County with a 32 percent increase over last year followed by Jackson County with a 26 percent increase, Wyandotte County with a 17 percent increase and Platte County with a 12 percent increase. The smaller counties of Leavenworth and Cass also had significant growth and Clay County remained relatively unchanged.
DO
Business with a
Member
Residential Building Permit Statistics February 2014 | Volume 20, No. 2 | www.kchba.org
Residential Building Permit Statistics
CASS COUNTY Archie Belton Cass County Cleveland Drexel Garden City Harrisonville Lake Winnebago Lee's Summit Peculiar Pleasant Hill Raymore Village of Loch Lloyd
CLAY COUNTY Clay County Excelsior Springs Gladstone Kansas City Kearney Lawson Liberty North Kansas City Pleasant Valley Smithville JACKSON COUNTY Blue Springs Buckner Grain Valley Grandview Greenwood Independence Jackson County Kansas City Lake Lotawana Lee's Summit Oak Grove Raytown Sugar Creek PLATTE COUNTY Edgerton Kansas City Parkville Platte City Platte County Riverside Weatherby Lake Weston JOHNSON COUNTY De Soto Edgerton Fairway Gardner Johnson County Leawood Lenexa Merriam Mission Hills Olathe Overland Park Prairie Village Shawnee Spring Hill Westwood
Single Family Units^
M-F Units Sale%
M-F Units Rent
Total Units
S-F Units YTD
M-F Sale YTD
0 1 3 0 0 0 0 0 1 0 1 19 0 25
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 1 3 0 0 0 0 0 1 0 1 19 0 25
0 12 26 0 0 0 4 1 38 3 26 110 13 233
5 0 1 40 0 0 2 0 0 3 51
0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0
5 0 1 40 0 0 2 0 0 3 51
7 0 4 0 1 3 3 2 1 17 1 0 0 39
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0 0 0 0
7 0 4 0 1 3 3 2 1 17 1 0 0 39
DECEMBER 2013 DECEMBER 2013 M-F Rent YTD
Total Units YTD
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 12 26 0 0 0 4 1 38 3 26 110 13 233
46 0 3 465 58 1 39 9 0 30 651
0 0 0 0 0 0 0 0 0 0 0
0 0 221 340 0 0 0 0 0 0 561
46 0 224 805 58 1 39 9 0 30 1212
139 0 47 22 33 66 37 60 21 296 12 0 1 734
0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 432 0 0 0 0 0 432
139 0 47 22 33 66 37 492 21 296 12 0 1 1166
LEAVENWORTH COUNTY Basehor Lansing Leav. County Leavenworth Tonganoxie WYANDOTTE COUNTY Bonner Springs Edwardsville KCK/Wyandotte Co MIAMI COUNTY Louisburg Miami County Osawatomie Paola Spring Hill
December 2013
0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0
0 12 2 0 9 0 0 0 23
0 150 54 0 181 0 4 0 389
0 0 0 0 0 0 0 0 0
0 55 0 0 0 0 0 0 55
0 205 54 0 181 0 4 0 444
0 0 0 6 2 11 18 0 0 48 20 1 11 2 0 119
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
0 0 0 0 0 0 0 0 0 0 87 0 0 0 0 87
0 0 0 6 2 11 18 0 0 48 107 1 11 2 0 206
22 0 4 78 40 119 217 11 7 528 422 9 153 65 2 1677
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0
28 0 0 0 0 170 131 0 0 32 1140 0 0 0 0 1501
50 0 4 78 40 289 348 11 7 560 1562 9 153 65 2 3178
M-F Units Sale%
M-F Units Rent
Total Units
S-F Units YTD
M-F Sale YTD
M-F Rent YTD
Total Units YTD
7 0 6 0 2 15
0 0 0 0 0 0
0 0 0 0 0 0
7 0 6 0 2 15
87 19 56 22 9 193
0 0 0 0 0 0
0 0 0 0 0 0
87 19 56 22 9 193
3 0 6 9
0 0 0 0
24 0 0 24
27 0 6 33
15 1 144 160
0 0 0 0
24 0 306 330
39 1 450 490
0 3 0 0 0 3
0 0 0 0 0 0
0 0 0 0 0 0
0 3 0 0 0 3
22 23 0 0 5 50
0 0 0 0 0 0
0 0 0 0 0 0
22 23 0 0 5 50
284
0
111
395
4087
0
2879
6966
Comparison of Single Family Building Units for Greater Kansas City
(Cass, Clay, Jackson, Platte, Johnson, Leavenworth, Miami, Wyandotte Counties)
Month/Year January February March April May June July August September October November December Annual Total*
0 12 2 0 9 0 0 0 23
Single Family Units^
2007
353 475 824 687 677 616 546 515 397 597 385 313
6,385
2008
2009
2010
3,232
2,155
2,471 2,301
221 262 353 441 231 260 311 293 264 314 167 115
96 129 131 184 189 204 196 207 219 226 192 182
137 145 252 228 213 239 180 243 173 279 173 209
2011
90 121 180 210 230 262 204 205 202 205 185 207
2012
2013
3,299
4,087
188 182 270 277 294 268 288 260 379 331 283 279
273 224 335 444 337 333 409 354 383 371 340 284
All numbers shown in the box above are ACTUAL NUMBERS.,
Comparison of Permits By Units Issued Year to Date* 2007 - 2013 2007 2008 2009 2010 2011 2012 2013
S-F Units 6385 3232 2155 2471 2301 3299 4087
M-F Units
1524 1830 1497 253 600 1775 2879
Total Units
7905 5062 3652 2724 2901 5074 6966
*Annual totals may not match seasonally adjusted numbers. ^The Single Family number is units and includes both attached and detached units. %Multi-Family units are in buildings with 5 or more units and are divided by sale/rent. # Not available at time of report Permit information reflects the most recent data at time of publication. In order to ensure accurate recording of residential building permit statistics, the HBA may revise monthly and year-to-date figures when updated data is made available. 15
www.kchba.org | Volume 20, No. 2 | February 2014
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