March 2016 Building Business News

Page 1

March 2016

NAHB Fire Safety Statement – page 8 Eisenberg’s Economic Report – page 17 Marketing Specialist Seminar – page 22

Find out everything you need to know about the Greater Kansas City Home Show – page 9

Tom Woods Recognized as 2015 NAHB Chairman of the Board Tom Woods, founder of Blue Springsbased Woods Custom Homes, was recognized for his service as the 2015 chairman of the National Association of Home Builders (NAHB) during the association’s International Builders’ Show in Las Vegas on January 21, 2016. “Tom Woods has dedicated most of his adult life to improving communities through new home construction and development. It’s been gratifying to watch Tom in action, working on behalf of homebuilders all over the U.S. to bring about important legislative changes that encourage homeownership and new home construction,” said Brenner Holland, president of the Home Builders Association of Greater Kansas City A top initiative for Woods during his tenure involved urging Congress to enact housing finance reform ensuring the availability of the 30-year-fixed-rate mortgage as well as working to protect tax code measures that encourage home ownership, such as the mortgage

Tom Woods onstage at IBS as he was honored for his year as NAHB Chairman

interest deduction and the Low Income Housing Tax Credit. “Our primary focus has been to promote NAHB activities that keep the housing market moving forward and spur job growth,” Woods said. “We also have worked hard to fight unnecessary regulations that hurt home buyers, home builders and remodelers.” At the IBS ceremony, Woods was presented with a special pair of “Muddy Boots”, representing his hands-on approach to home building along with a personalized Royals jersey. The Kansas City Home Builders Association is proud to call Tom one of our own. Thank you, Tom, for representing the heart of America so well!


www.kchba.org | Volume 22, No. 3 | March 2016

Missouri North Area Council Meeting: Progress and Growth in the Northland

March Calendar March 3

An overflow crowd gathered at the Staley Farms Golf Club to hear from Greg Franzen, Assistant Director of Planning and Development for Kansas City, Missouri; Kansas City Councilman and Mayor Pro Tem Scott Wagner and Alicia Stephens, Executive Director of the Platte County Economic Development

OSHA Update

March 18-20 Greater Kansas City Home Show March 22

Board of Directors Meeting

March 23

Kansas Area Council Meeting

For more information or to register for any event, go to www.kchba.org or call 816-942-8800

procedures. Franzen also remarked that his department has added staff and that has allowed them to stay current with inspections. Councilman Wagner touched on important issues like the city budget and how the Shoal Creek TIF made sewers and roads possible in the area and that this

Shown left to right: Clay McQuerry, Brent Dobberstine, Don Julian, George Schluter, Matt Ernst, Greg Franzen, Alicia Stephens, Scott Wagner, Sara Corless and Brenner Holland

Council. Thanks go to Matt Ernst and Brent Dobberstine, chair and co-chair of the MO-N Council as well as to Misty Hanson and Chris Ragland for their work in making the meeting a success. Clay McQuerry, Executive Director of Rebuilding Together Clay County, provided a summary of the many ways the non-profit organization aids local residents. Local builders are encouraged to donate excess building materials or volunteer services to repairing homes.

2

Greg Franzen commented that the city is unlikely to make any major code changes in the coming months as his office values the consistency of using the 2012 IRC. He reminded builders to be aware of ADA requirements and to look for more guidance to be issued. He stated that the city’s current electronic permitting capability and a forthcoming process that will include more departments in a single application will further streamline permit

infrastructure will bring jobs and housing to the area. He also reviewed the cost and benefits of improving the highways in the area and improving surface streets as they access the highway system. This led to a discussion of his Big Idea Northland Project, which provides anyone with a computer the opportunity to share his or her vision for future development and progress in the Northland. He encouraged people to participate by visiting www.kcmomentum.org. Alicia Stephens focused on the possibilities several cities in Platte county have for growth, mentioning Platte City, Parkville and Riverside as areas with great potential. Stephens reviewed the impact a new airport would have on the surrounding area and advised those present to learn about all the options and costs. She stated that a new terminal would be the biggest project and best avenue for job growth in Platte County since the airport was originally built.


March 2016 | Volume 22, No. 3 | www.kchba.org

2016 Elections Election season is upon us. Depending on the results of earlier primaries, Kansas and Missouri may help narrow the field of presidential hopefuls. The Kansas caucuses will be held on Saturday, March 5, and the Missouri primary will be Tuesday, March 15. The next round of elections will take place on April 5 for local elected officials. These municipal elections, held in both Kansas and Missouri, vary from city to city. Depending on how the staggered terms are set up, some municipalities will elect new mayors and others just city council members. Visit the website listed for your county for details on elections in your city. As far as state elections, those are varied as well. In Missouri, all members of the House of Representatives are up for re-election, half of the Senators, the Governor, and many statewide officials. In Kansas, all Senators and Representatives are up for re-election, but not the Governor or state officials. The primaries for both state elections will be held Show Election federal on August 2, and the General lawmakers the8. will of course take place on November

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www.kchba.org | Volume 22, No. 3 | March 2016

Kansas Legislative Day

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Mark Mather, George Schluter, David Elliott, Sara Corless, Rep. Stan Frownfelter and Justin Reys (NAHB Field Rep)

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On Wednesday, January 27, KCHBA and other members of the Kansas Building Industry Association (KBIA) gathered in Topeka for Kansas Legislative Day. The day served as an important opportunity to meet with legislators face-to-face and discuss current issues affecting home builders. Notable meetings with legislators from KCHBA’s jurisdiction included Majority Floor Leader Jene Vickrey, Senator Kay Wolf, Representative and Chair of the House Committee on Taxation Marvin David Elliott, Sean Miller, George Schluter and Mark Kleeb and Representative Mather in the Kansas Capitol Stan Frownfelter, who specializes in housing issues ning, members attended the legislative for the minority party. The purpose of reception held by KBIA that was open these meetings was to share KCHBA’s to all Kansas legislators. There was a legislative agenda for Kansas, to make strong showing of Senators and Represure our legislative positions on cersentatives, giving members the chance tain issues are clear, and to encourage to continue to build relationships with support of the home building industry elected officials who are regularly makas the session continues. In the eveing decisions that impact the industry.

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February 2016 | Volume 22, No. 2 | www.kchba.org

Kansas Property Tax Lid Legislation Legislation was added into the Kansas budget discussion at the very end of the 2015 session which, beginning in January 2018, prohibits cities and counties from increasing property taxes more than the preceding year, adjusted for changes in inflation, unless the tax

road construction, legal fees, and federal or state mandated expenditures. At the latest KBIA Board meeting, which took place January 27 at Kansas Legislative Day, members voted to oppose SB 316 and other new changes to the property tax lid. They expressed con-

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increase is taken to a public vote. Due to the last minute adoption of this measure, no public hearings were held and city and county officials had no chance to oppose the plan. SB 316, legislation introduced by Senator LaTurner (R-Pittsburg), would put additional limitations on the types of local property taxes that could be increased under the lid and changes the effective date to July 2016 instead of 2018. It removes almost all of the exemptions, including those relating to new and existing infrastructure, new

Comm State Of Ks College State Of Ks

cern that further tying the hands of local government and restricting the ability to fund new infrastructure and roads would have significant consequences for cities and counties. It could lead to harmful budget cuts, slower economic growth in terms of new development and jobs, and a search for other sources of revenue. Unfortunately, that search might result in increased fees for those in the home building industry, with those funds being spent on unrelated projects.

5


www.kchba.org | Volume 22, No. 3 | March 2016

NAHB Value Covers Your Dues Investment Talk about a return on investment – for a $625 dues payment ($182 of which goes to NAHB), a typical home builder will receive a value of $5,700 per start as a result of key NAHB advocacy victories and other services to members. According to the NAHB Economics and Housing Policy Group, these are just some of the major areas where the NAHB achieved savings for the home building industry: 1. FHA Mortgage Insurance Premium Decrease In a victory for NAHB, President Obama announced in January 2015 that the Federal Housing Administration (FHA) would reduce its annual mortgage insurance premiums by 0.5 percentage points, from 1.35 percent to 0.85 percent. For the typical first-time home buyer, FHA estimates this reduction translates into a

Mortgage Guarantee Fees

$900 reduction in their annual mortgage payment.

In an important victory for NAHB and home owners, the association was able to

2. NAHB Defeats Proposal to Raise

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ensure that a five-year highway bill did not use guarantee fees (g-fees) collected by Fannie Mae and Freddie Mac to Continued on page 5

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March 2016 | Volume 22, No. 3 | www.kchba.org

NAHB Value pay for Continued from page 4 transportation programs. NAHB led the charge to strip a provision from the legislation that would have used g-fees to help offset a funding shortfall. To help fund the long-term transportation bill, lawmakers proposed a four-year extension to a previously-imposed g-fee increase of 10 basis points. Extending the 10 basis point fee increase for an additional four years would have amounted to a $1.9 billion tax on home owners. 3. PMI Tax Deduction Extended H.R. 2029, the Protecting Americans from Tax Hikes Act of 2015, extended the deduction for mortgage insurance for 2015 and 2016, including mortgage insurance fees paid for FHA and VA loans. Such deductions reduce the after-tax cost of purchasing a home with a low down payment, which is common among firsttime home buyers. 4. Energy Efficient Home Tax Credit for Builders Extended The 45L credit provides builders with a $2,000 tax credit for the sale of homes that achieve a 50 percent improvement in energy efficiency over the 2006 International Energy Conservation Code. Congress extended the credit for 2015 and 2016 under H.R. 2029, the Protecting Americans from Tax Hikes Act of 2015. In 2016, home builders are expected to qualify for $361 million in tax savings due to 45L, according to estimates from the congressional Joint Committee on Taxation.

140,000 jobs in remodeling in 2009. Government data indicates that the typical energy-efficient remodeling project costs a little more than $2,800. 6. Onerous OSHA Silica Requirements Delayed OSHA has been working for eight years on a rule to minimize the release of crystalline silica particles on construction work sites. During that time, NAHB has communicated frequently with OSHA, emphasizing that proposed requirements for frequent worker monitoring and reporting and/ or tracking the silicate content in every substrate that every employee works on would be very costly. Without continual action by NAHB, OSHA would certainly have issued the final rule by now.

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NAHB members continue to invest time, effort and money to attain professional designations offered by NAHB, which they clearly wouldn’t do unless they believed the designations provided value. There is further evidence in NAHB’s latest consumer survey, where 64 percent of recent and prospective home buyers agreed that contractors with such specialized professional designations are “worth paying a higher price for.”

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5. Energy Efficient Remodeling Tax Credit Extended The 25C tax credit provides consumers a tax credit of up to $500 for the purchase of qualifying energy-efficient products. The 25C tax credit supported almost

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www.kchba.org | Volume 22, No. 3 | March 2016

It’s More than Just Smoke Alarms

ARE YOU READY TO TAKE YOUR BUSINESS TO THE NEXT LEVEL? We have the communication & marketing solutions to help ONLINE • MAGAZINE • NEWSPAPER • EVENTS

The Society of Fire Protection Engineers has invited NAHB to write a “Viewpoint” article discussing the residential construction industry’s view on fire safety. The piece will run early this year, but we’re sharing it in advance with our members.

There have been significant improvements to the fire safety of homes over the past few decades, leading to a dramatic, continued decrease in fires, injury, death and property loss. As fire safety professionals know, fire deaths have decreased by over 60% since 1960 (50%

The National Association of Home Builders is a firm believer in safe, affordable homes. Our members have a vested interest in the safety of their products, both during the building process and after the house becomes someone’s home. For that reason, home builders are active participants in the codes and standards development process, helping to make sure that each advance in building science and technology is weighed for the appropriate balance of safety, efficiency and cost to help ensure that each code cycle results in advances that improve homes without pricing them out of reach.

since 1978), while the death rate based on population size has decreased by well over 70%.

The home builder acts as a consumer advocate, offering counterpoint to code change proposals that benefit particular brands or products. And when it comes to advances in fire safety technology, our members are proud to produce homes built to building codes designed to keep their occupants safer than homes built in previous generations.

For information about promoting your business or new home community directly to new home buyers in your geographic area contact:

Jared Webb at 816-234-4734 or jwebb@kcstar.com 8

Technological innovations in building techniques include advanced heating and electrical systems, egress windows, hardwired, interconnected smoke alarm systems, and fire-resistant materials and features like the separation between the house and the garage and fireblocking in concealed spaces. When home owners combine these advances with proper maintenance, homes stay safer. And as more of the existing housing stock that doesn’t include these improved fire safety features is replaced, this trend will continue. Why Smoke Alarms Matter The effectiveness of smoke alarms cannot be underestimated. Hardwired, interconnected smoke alarms have been required by NFPA 72, National Fire Alarm and Signaling Code since 1989, and continue to become Continued on page 16


March 2016 | Volume 22, No. 3 | www.kchba.org

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www.kchba.org | Volume 22, No. 3 | March 2016

Greater Kansas City Home Show 2016 The original Greater Kansas City Home Show returns in spectacular fashion to Bartle Hall on March 18 – 20. Hundreds of exhibitors will showcase new opportunities and choices for homeowners to get a jump on spring home improvement, decorating and garden projects. A stellar line-up of stage presenters will include Chip and Joanna Gaines (Fixer Upper), Pete Nelson (Treehouse Masters), and Jennifer Bertrand (Design Star). When : Friday-Sunday, March 18 - 20 Where : Bartle Hall, 301 W. 13 St. KCMO Hours: Friday: 12 pm – 8 pm Saturday: 10 am – 8 pm Sunday: 10 am – 5 pm Online Ticket Purchase: kchomeshow.com Friday only ticket - $7.00 One-day admission (Fri, Sat or Sun) - $10.00 Price Chopper Stores Friday only ticket – n/a One-day admission (Fri, Sat or Sun) - $10.00 Bartle Hall Box Office Friday only ticket – n/a One-day admission (Fri, Sat or Sun) - $12.00 Children 12 and under are free

Special Friday Presentation: Pete Nelson of Treehouse Masters His creations have been featured on countless TV shows and newspaper articles. He continues to challenge himself and his team to build the most luxurious lifestyles in the lofty heights of trees around the world.

“The Treehouse Guy” Pete Nelson is the star of Animal Planet’s Treehouse Masters. With a reputation for limitless imagination and incomparable skills, Pete is widely known as the best treehouse builder in the world. Living by the motto “if you dream it, you can build it,” he constantly pushes his clients’ treehouse expectations to the max. With an arsenal of experience Pete continues to design and build treehouses the world has never seen before.

Pete will speak from the Designer Stage on Friday, March 18 at 2 pm and 6 pm. Don’t miss this opportunity to see his amazing structures!

Boy Scouts Bring the Outdoors into Bartle Hall

Chip and Joanna Gaines Return to the Greater Kansas City Home Show Chip and Joanna Gaines, stars of HGTV’s Fixer Upper, drew record crowds to the 2015 Home Show. Along with filming the second season of Fixer Upper, Chip and Joanna have continued to operate their Magnolia Homes business, opened Magnolia Market at the Silos, written a book, and renovated a one-hundred plus year old house as a bed and breakfast— all while raising four children! Natural and unassuming, Chip and Joanna have a relaxed charm and appealing chemistry that shines through as they help clients purchase a home and renovate it to function for today’s lifestyle. Their presentations will include how Chip’s construction background, matched with Joanna’s flair to add just the right touch, evolved into Magnolia Homes, their small-town home renovation business, and their instant success on HGTV.

Members of the Boy Scouts will be on hand throughout the weekend to help you try your hand at a rock-climbing tower. Safety comes first – all climbers will be equipped with a helmet and a climbing harness. Home show visitors can also explore a 25-foot tall teepee, previously on display at the Nelson-Atkins Museum of Art. The Boy Scout climbing tower and teepee will be located in the center of the Home Show’s landscaping displays. 10

For the 2016 home show, Chip and Joanna will speak from the Spaces stage with increased seating capacity on Saturday, March 19 at 3 pm and on Sunday, March 30 at noon.


March 2016 | Volume 22, No. 3 | www.kchba.org

INSPIRATION from the Designer Stage

Continuing a Tradition: The Kansas City Home Builders Association Home Show for 2016 The year was 1948 – World War II was over; our own Harry Truman was in the White House; a first class stamp cost 3 cents; and, in Kansas City’s Municipal Auditorium, a brand new event was held – the Home Builders Association Home Show. Crowds flocked to see current trends in home improvement and decorating, including the latest technology in clothing care— an automatic washer with attached wringer!

groups such as Wayside Waifs and other pet adoption efforts, an Ask a Builder booth and appearances by well-known architects, interior decorators and home improvement experts.

Jennifer Bertrand HGTV Design Star Winner

For sixty-eight years, the Home Builders Association has offered Kansas City the most current and wide-ranging displays of home improvement, technology, and decorating ideas as well as a funfilled day with activities for all ages.

Jennifer Bertrand is best known as the winner of HGTV’s Design Star, drawing over 5 million viewers to her no-nonsense, accessible approach to making positive and impactful design changes without breaking the bank. Owner of Kansas City’s Bertrand Designs, Jennifer believes “great design should make you happy and make your life easier.”

Chris Ragland, Homes by Chris For more than ten years, Homes by Chris has been an award-winning designer/builder in the Kansas City area. Although each home is custom and unique, Chris’ signature style is streamlined and fresh, with hints of craftsman details, featuring extensive woodwork and natural stone, marrying the exterior and interior with outdoor living areas.

Darol Rodrock Rodrock Development and Darol Rodrock Foundation

Throughout the years since that first show, special features have ranged from Jones Store fashion shows, Worlds of Fun characters roaming the floor, to a 1987 vision of the SMART HOUSE. Even though that 1987 vision of the future relied on a single wiring system and now we’ve moved on to the internet of things, that vision did include many current features appearing in new homes.

Darol Rodrock will share his two passions with Kansas City area residents—home and community building and improving the lives of children in foster care. In building a home in the middle of Bartle Hall, Darol will share his years of experience in quality construction and exacting standards along with the latest in decorating and the finishing touches of a home.

Decorating trends may come and go, technology and house construction is ever-improving, but home remains the place where memories are made. The members of the Home Builders Association of Greater Kansas City are proud to offer local residents a chance to experience the best ways to make their home a place of comfort and beauty.

Jennifer Allwood Owner of The Magic Brush, Inc. Jennifer Allwood believes that with a little encouragement and inspiration, everyone is capable of creating a home they love. Her blog and social media channels serve over 250,000 DIYers with tips on painting, decorating, and balancing life and work. Meet her in person where she’ll be demonstrating how to paint nontraditional paint surfaces including tile, fabric, lights and more!

A home built inside Bartle Hall, featuring the latest in construction materials and decorating trends has been a special attraction for many years. The Home Show has included community 11


www.kchba.org | Volume 22, No. 3 | March 2016

WEST DOCK

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March 2016 | Volume 22, No. 3 | www.kchba.org

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www.kchba.org | Volume 22, No. 3 | March 2016

Don’t Be Afraid of Smart Home Technology The smart-home technology craze began years ago in some parts of the country, but in many other areas, it’s only just begun. If you’re just entering this market, or have yet to do so because you think you don’t have the know-how, fear not – you don’t need to be a technology specialist. But you should become familiar with what’s trending and how you can address your clients’ needs before they go to another builder.

Get a feel for what’s really trending During an education session at this year’s International Builders’ Show, Greg Haupert, the executive director of Business Networking International and a home-technology integration specialist, listed several smart-home trends that have truly started to take root, including:

STYLE THAT

WORKS

Contemporary comfort with automated thermostats, lighting and security systems that quickly learn the owner’s preferences and can be controlled and monitored from anywhere in the world. High-tech appliances like refrigerators with internal cameras that allow the owner to remotely check its contents, and an automated compressor that adjusts its speed according to how much food is inside.

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Smart TVs – not simply those that run apps like Netflix and Hulu, but rather, TVs that are integrated to create a smart-home hub through which many, if not all of the home’s smart features can be controlled.

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Team up with an expert Once you know what’s hot among consumers, but don’t feel confident enough to market yourself as a smart-home specialist, Haupert suggests partnering with one. It’s okay to admit you don’t have all the technology answers as long as you partner with or employ someone who does, and who can comfortably interact with the client. Furthermore, he suggests working with contractors who can offer service contracts to the client. This will reduce your liability if (or rather, when) issues arise.

Plan ahead But before you get too far down the road with a client, it’s critical to develop a technology plan as early as possible. Custom A/V and smart-home technology is best integrated when planned for well in advance. Pre-wiring a new home can save the client thousands down the road. Haupert strongly advises that builders find out which pieces of technology the client wants and how they want to use them in their home. From there, go through the floor plan room by room and ask how they might want to use the technology in each space. NAHBNow, 2/8/16

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KCSTAR_SHOWGUIDE_RODROCK_NEW.pdf

1

March 2016 | Volume 22, No. 3 | www.kchba.org

2/22/16

3:47 PM

Over Three Decades of Residential Development

Take Time To Tour

The Darol Rodrock

Farmhouse While At The Home Show

Rodrock Development and The Darol Rodrock Foundation are beyond thrilled to be the presenting sponsor for what promises to be three days chockfull of the latest in design and homebuilding trends at this year’s Greater Kansas City Home Show at Bartle Hall. And Kansas Citians are absolutely ecstatic for the return of the incredibly popular decorating duo Chip and Joanna Gaines to this year’s Show. In an exciting addition this year, Darol Rodrock Homes will be building a tiny farmhouse—at about 700 square feet—which will be the perfect display piece to feature Joanna Gaines’ distinctive flair. Show attendees can tour the adorable mini abode, which uses Joanna’s decorative approach as inspiration.

FEATURING THE INSPIRATION OF:

Chip & Joanna Gaines

Factory Direct Appliance Fike’s Painting Heartland Truss, Inc. NSPJ Architects Pella Windows & Door Porter Paints Schutte Lumber Company Shamrock Cabinets & Fixtures Sun Lumber Wilson Lighting

HGTV’s Stars of FIXER UPPER

CONTRIBUTING VENDORS Acme Floor Company Austin Tile, Inc. Central States Tile, Inc. Century Roofing Complete Home Concepts Epic Landscaping Productions Ferguson

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www.kchba.org | Volume 22, No. 3 | March 2016

This month’s pro tip is:

IBS Best in Show Winner: Winbag

PROMISE Bank of Blue Valley promises a partner, not just a bank.

When was the last time you saw a truly new kind of tool out there? Sure there are updates, improvements and new designs of many tools available regularly. But how often do you come across something genuinely new? It will strike you at first as an odd looking product and you will most likely have second thoughts about buying a craftsman tool that looks more like something out of your doctor’s office for measuring blood pressure.

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It’s More than Just Smoke Alarms (Continued from page 8) more effective with ongoing technical advances. There is also continued research aimed at improving the detection logarithm to greatly reduce false alarms from cooking. All these improvements are still unfolding, and can be expected to further reduce the number of fatalities. And throughout the country, local home building associations often work with community fire departments on fire safety campaigns and to ensure that consumers take advantage of this life-saving technology by conducting awareness campaigns and even donating new units.

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But don’t let the appearance fool you. The WINBAG is the most versatile and revolutionary tool that has been put on US market in many years. It will completely change the way installers do all kinds of work, making their lives a lot easier while saving them tons of time. Go to www.winbagusa.com to see how this product can help you install windows, doors, appliances and be helpful for many other uses.

© 2015 Andersen Corporation. All rights reserved

This education and awareness is vital, 16

because the main causes of unintentional, non-confined home fires are heating equipment and electrical malfunction, both primarily associated with older homes. New homes are equipped with new heating appliances with clearances, vents, and chimneys in accordance with current codes as well as additional safety features, making them more reliable and producing a more balanced airflow reducing the need for supplemental heaters, which are more likely to start a fire. Going forward, it is important to carefully consider any additional requirements so we don’t put safer new homes financially out of Continued on page 18


March 2016 | Volume 22, No. 3 | www.kchba.org

Bowtie Economist Sees 2016 as a Repeat of 2015 The always entertaining and informative Elliot Eisenberg spoke to a full room at the HBA on February 10th. Elliot’s primary message: “The Economy in 2016: Much Like 2015” with interest rates expected to remain stable, wage growth slowly improving, no inflation, and housing improving in fits and starts. The action item he recommends to builders: get to know the millennial generation and what they will want in a home. Some of the data that Elliot shared included: The good news is households are repairing their balance sheets and thus have income to spend. The bad news is – if consumers start to slack off in spending, the other parts of the economy won’t be able to make up for that decrease. Consumer confidence, restaurant spending, Las Vegas visitors and hotel occupancy rates all point to a strengthening economy. Thirty-year mortgage rates should remain should remain stable as the Federal Reserve raises the federal funds rate very slowly, if at all. The rate of new household formation has finally started to increase with an increase of 1.7 million in 2015. However, most of those new households were formed by people age 55 and older.

lation are those aged 22 – 24 years old. With the average age of a first-time home buyer at 31, there may be a surge of activity in about six years. Elliot advises

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“Multi-family party may be starting to end” as the vacancy rate is up two quarters in a row for the first time since 2009. Existing home sales should rise by 4% to 6% in 2016 although first-time buyers are still largely missing in action.

and many more...

nahb.org/MA

The largest age cohort in the US popu17


www.kchba.org | Volume 22, No. 3 | March 2016

Labor is Top Challenge for Builders Topping the list of problems builders faced in 2015 and expect to face in 2016 is the Cost/Availability of Labor, an issue for 76% of builders who expect it to increase in 2016 and which has increased in importance the past three years. In 2013, 53% of builders rated labor as a significant problem, followed by 61% in 2014 and 71% in 2015. An expected skilled labor shortage can constrain an improving housing market. The monthly NAHB/Wells Fargo Housing Market Index often includes a set of “special” questions on a topic of current interest to the housing industry. In January 2016, the special questions asked builders about the problems they faced in 2015 and expect to face in 2016.

The second most significant problem was Cost/Availability of Developed Lots for 59% of builders for 2016. In 2013, the Cost/Availability of Lots was rated significant by 46% of builders who responded to the survey. That share increased to 55% in 2014 and again to 58% for 2015. Both the availability of labor and lots highlight the expected constraints of a recovering housing market. Federal Environmental Regulations and Policies is expected to remain a significant problem for 51% of builders in 2016. In 2013, the federal environmental regulations and policies was rated a significant problem by 46% of builders, increasing to 53% in 2014 and then 55% in 2015.

Building Material Prices continue to be a problem for builders. In 2013, 68% of builders rated building material prices as a significant problem, but that share decreased to 58% in 2014 and further declined to 42% in 2015. However, 56% of builders responding to the latest survey expect it to be a problem in 2016.

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At 55% each, the Concern about the Employment/Economic situation and Impact/Hook-up/Inspection or other Fees are other significant problems

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expected by a majority of builders in 2016. The Concern about the Employment/Economic situation was a significant problem in 2013 for 60% of reporting builders, the issue dropped in significance to 51% in 2014, and again dropped to 47% in 2015. On the other hand, the Impact/Hook-up/Inspection or other Fees was a problem faced by 46% of builders in 2013, 52% in 2014 and 53% in 2015.

It is a sad irony when Americans cannot afford to be safe. Families who cannot qualify to purchase homes due to the increased costs from well-meant, but expensive and ultimately unnecessary safety features will remain in housing that is less safe, because it’s built to less stringent code requirements. These older homes can have outdated appliances, space heaters, faulty wiring, or

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other characteristics that might lead to a greater risk of a fire starting, or a lack of smoke alarms and egress windows installed to today’s codes which increase the chances of dying in that fire. For that reason, we take our code development responsibilities very seriously. We must ensure that new homes are safe, but not just available to the wealthy. NAHBNow, 1/17/16


March 2016 | Volume 22, No. 3 | www.kchba.org

HBA Staff Sara Corless Executive Vice President scorless@kchba.org, 816-733-2216

Kelcee Schlotzhauer Events and Administration Assistant kelcee@kchba.org, 816-942-8800

Gina Battle Director of Parade of Homes gina@kchba.org, 816-733-2219

Katie Walkley Government Affairs Manager katie@kchba.org, 816-733-2241

Dawn Allen Director of Member Services and Events dawn@kchba.org, 816-942-8800

Marcia Jurgens Director of Administration marcia@kchba.org, 816-733-2215

Tricia French Project Manager tricia@kchba.org, 816-733-2241

The Home Builders Association of Greater Kansas City Thanks the 2016 Sponsors AFFINITY SPONSOR

Stewart Specialty Insurance Services PLATINUM SPONSORS

St. Louis – Kansas City Carpenters’ Regional Council Kansas City Star Media Company Wells Fargo Home Mortgage

Stewart Specialty Insurance Services is the proud new insurance and risk management associate for the Home Builders Association of Greater Kansas City.

GOLD SPONSORS

Bank of Blue Valley Bovard Insurance Group Capitol Federal Fasone & Partners Ferguson Enterprises First Federal Bank Kansas Gas Service K&E Flatwork Kenny’s Tile Laclede Gas McCray Lumber

Northcraft Flooring & Granite Owen Lumber Phelps Engineering ProBuild Rew Materials Star Companies, Inc Stewart Title Sun Lumber United Heating, Cooling & Plumbing

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19


www.kchba.org | Volume 22, No. 3 | March 2016

New Members Compi Distributions, Inc. Patrick Angevine 5900 Equitable Road Kansas City, MO 64120 (636) 296-1111 www.compidistributors.com Made in the Shade Blinds and More Andrew Morstatter 5985 NW 48th St. Kansas City, MO 64151 (816) 368-8155 www.mitsblinds.com/kansascity Prime Homes, Inc. Dan Elliott 5425 W. 100th St. Overland Park, KS 66207 (913) 915-7900 www.kcprimehomes.com Rockwood Builders Richard Pfaff 12741 Bradshaw St. Apt. 1106 Trim size: Overland Park, KS 66213 4.75 x 4.75 (913) 602-4819

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Renovation Office: 913-234-2925

Information is accurate as of date of printing and is subject to change without notice. Wells Fargo Home Mortgage is a division of Wells Fargo Bank, N.A. © 2014 Wells Fargo Bank, N.A. All rights reserved. NMLSR ID 399801. AS1055681 Expires 5/2015 20

(816) 245-4219 www.ffbkc.com Hearthside Homes of Kansas City John Zeller Jerry Copeland Fred Foster Chris Sellers Brett Smith PO Box 545 Liberty, MO 64069-0545 (816) 781-0234 www.hearthside-kc.com Reece & Nichols Meredith Tolliver Sherri Cole Russell Roberts 11601 Granada Leawood, KS 66211 www.reeceandnichols.com Shawnee Mission Ford Roger Klein 11501 W Shawnee Mission Pkwy Shawnee, KS 66203 (913) 248-2296 www.shawneemissionford.com The Jennifer Harvey Team Diedre Williams 6744 Longview Shawnee, KS 66218 (913) 221-8863 www.justcalljennkc.com


March 2016 | Volume 22, No. 3 | www.kchba.org

Member Anniversaries 1948 Western Chandelier Company 1964 James D. Neighbors Construction Company, Inc. North American Savings Bank 1970 Richard Mather Builders, Inc. 1973 Steve Foley Construction Co., Inc. 1976 Woods Custom Homes LLC 1977 Hensler Homes, Inc. 1979 Jim Tharp Builder, Inc. The Hayes Company 1985 Martens Family Enterprises, Inc. Robert Montgomery Homes, Inc. 1988 Bordner Installation Group, Inc 1993 SAB Homes, Inc. 1994 Gordon Energy & Drainage 1996 Century Roofing Clay County Savings Bank 2001 EPIC Landscape 2003 Nebraska Furniture Mart, Builder Division The Land Source 2004 Bovard Insurance Group Mather Development Missouri Gas Energy 2007 Cedar Creek Development Co., Inc 2008 Tim Cunningham Homes LLC 2009 DaVinci Roofscapes

2012 Construction & Planning Services, Inc 2013 Brummel Lawn and Landscape PCDI Homes 2014 Buckley Roofing & Stucco Crider Carpet E.S. Photography Glueck Development, LLC Jim’s Disposal Service Meridian Homes, Inc. RAM Metal Products Shawnee Mission Ford 2015 Beginnings KC Real Estate Country Club Bank Delta Construction, LLC First Service Residential Neenan Company Pro Builders since 1994 LLC

Perfect Balance Trying to stand out from the competition doesn’t have to drive you nuts. Deckorators helps set you apart with decking from the same source you’ve relied on for railings, balusters, post caps and more. Plus, the Deckorators composite decking lineup is the only one backed by a 25-year Removal & Replacement warranty. Visit deckorators.com for more information.

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Call today 816-942-8800, or email gina@kchba.org or scorless@kchba.org 21


www.kchba.org | Volume 22, No. 3 | March 2016

JOIN US FOR

Detail Permit Report

Marketing That

Subscribe to the Detail Permit Report — monthly info on who’s building where throughout the 8 county area. Available only to HBA members, a oneyear’s subscription costs $460. Other reports also available.

MOVES People

Contact Marcia (Marcia@kchba.org) to subscribe.

WITH MOLLIE ELKMAN WHEN Wednesday, April 6, 2016 from 9am–10:30am WHERE The Home Builders Association of Greater Kansas City 600 E. 103rd St. Kansas City, MO 64131

You’ll definitely leave this program with real tools and strategies that you can implement in your business TODAY!

Please RSVP to Tricia at 816-942-8800 or Tricia@kchba.org • Seating is limited to 75.

• The importance of emotion-based marketing, and how it helps you connect with buyers and realtors.

• SMC Members are discounted • $20/Members • $40/guests

Brought to you by

9:00 – Coffee and Croissants 9:30 – Presentation Mollie Elkman is an international speaker on all subjects relating to marketing for the housing industry. She specializes in understanding the consumer experience, and creating successful, traffic-driving advertising programs for builders from coast to coast.

Need more info than the Statistics Report provides?

You’ll learn... • How to position yourself in the market • How to incorporate social media, online advertising, and the Parade of Homes into your overall marketing strategy. Mollie will provide real examples of builder marketing messages and visuals that make an emotional connection.

This is a CAN’T MISS opportunity! 22

BuildingBusinessNews THE OFFICIAL PUBLICATION OF THE HOME BUILDERS ASSOCIATION OF GREATER KANSAS CITY March 2016 • Volume 22 • Issue 3 Copyright 2016

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 Marcia Jurgens Contributing Writer Katie Walkley Graphics Karla Peterie, Creative Services

2016 Executive Committee Home Builders Association of Greater Kansas City

President Brenner Holland Vice President Harold Phelps Secretary/Treasurer Gary Kerns Immediate Past President Mark Mather Associate Representative Kevin Kirtley Past Presidents Representative Bob Frost To subscribe to Building Business News call (816) 733-2217 To advertise in Building Business News call (816) 733-2215 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


March 2016 | Volume 22, No. 3 | www.kchba.org

January Permits Continue Building Activity Trend The Home Builders Association of Greater Kansas City recently heard from economist Elliot Eisenberg who predicted that 2016 home building activity will continue at about the same rate as in 2015, with a gradual increase as the year progresses. Single family housing permits issued during January 2016 confirm that assessment, according to the Home Builders Association of Greater Kansas City’s (HBA) monthly Residential Building Permit Statistics report. With 265 single family units, the January total increased by 10% from the same month a year ago (January 2015) but dropped below the 2015 monthly average. A decrease in activity is common during January as home buyers and builders are affected by the holiday season and winter weather during December and January. Multi-family activity added 85 units to be built in the metro area. “With over 340 homes entered in the Spring Parade of Homes, we expect the spring buying season to be very active and that builders will be busy increasing the new home inventory as we move further into the warm weather season,” said HBA Executive Vice President Sara Corless. Kansas City issued the most permits in the eight county area with 71 during January, followed by Olathe with 28. Overland Park, Grain Valley and Lenexa rounded out the top five municipalities in residential permit counts. Johnson County was the top permitting county with 87, followed by Clay County with 58 and Jackson with 52.

January 2016

Residential Building Permit Statistics

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^

MultiFamily Units%

2 1 0 0 0 0 0 0 0 0 1 10 0 14 1 1 0 48 7 0 1 0 0 0 58

JANUARY 2016

Total Units

S-F Units YTD

M-F Units YTD

Total Units YTD

0 0 0 0 0 0 0 0 0 0 0 0 0 0

2 1 0 0 0 0 0 0 0 0 1 10 0 14

2 1 0 0 0 0 0 0 0 0 1 10 0 14

0 0 0 0 0 0 0 0 0 0 0 0 0 0

2 1 0 0 0 0 0 0 0 0 1 10 0 14

0 0 0 0 0 0 0 0 0 0 0

1 1 0 48 7 0 1 0 0 0 58

1 1 0 48 7 0 1 0 0 0 58

0 0 0 0 0 0 0 0 0 0 0

1 1 0 48 7 0 1 0 0 0 58

LEAVENWORTH COUNTY Basehor Lansing Leavenworth County Leavenworth Tonganoxie WYANDOTTE COUNTY Bonner Springs Edwardsville KCK/Wyandotte Co MIAMI COUNTY Louisburg Miami County Osawatomie Paola Spring Hill Totals

Single Family Units^

MultiFamily Units%

Total Units

S-F Units YTD

M-F Units YTD

Total Units YTD

5 1 3 0 1 10

0 0 0 0 0 0

5 1 3 0 1 10

5 1 3 0 1 10

0 0 0 0 0 0

5 1 3 0 1 10

0 0 6 6

0 0 0 0

0 0 6 6

0 0 6 6

0 0 0 0

0 0 6 6

4 2 0 0 0 6

0 0 0 0 0 0

4 2 0 0 0 6

4 2 0 0 0 6

0 0 0 0 0 0

4 2 0 0 0 6

265

85

350

265

85

350

Comparison of Single Family Building Units for Greater Kansas City (Cass, Clay, Jackson, Platte, Johnson, Leavenworth, Miami, Wyandotte Counties)

9 0 16 0 1 1 1 8 0 9 7 0 0 52

0 0 0 0 0 0 0 30 0 0 0 0 0 30

9 0 16 0 1 1 1 38 0 9 7 0 0 82

9 0 16 0 1 1 1 8 0 9 7 0 0 52

0 0 0 0 0 0 0 30 0 0 0 0 0 30

9 0 16 0 1 1 1 38 0 9 7 0 0 82

0 15 6 0 6 0 5 0 32

0 55 0 0 0 0 0 0 55

0 70 6 0 6 0 5 0 87

0 15 6 0 6 0 5 0 32

0 55 0 0 0 0 0 0 55

0 70 6 0 6 0 5 0 87

2 0 1 5 3 3 15 0 0 28 26 0 3 1 0 87

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

2 0 1 5 3 3 15 0 0 28 26 0 3 1 0 87

2 0 1 5 3 3 15 0 0 28 26 0 3 1 0 87

0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

2 0 1 5 3 3 15 0 0 28 26 0 3 1 0 87

23

Month/Year January February March April May June July August September October November December

2009

2010

2011

2012

2013

2014

2015

Annual Total

2,155

2,471

2,301

3,299

4,090

4,271

4,700

96 129 131 184 189 204 196 207 219 226 192 182

137 145 252 228 213 239 180 243 173 279 173 209

90 121 180 210 230 262 204 205 202 205 185 207

188 182 270 277 294 268 288 260 379 331 283 279

273 224 335 444 337 333 409 354 384 369 340 288

287 216 362 439 385 364 375 352 383 468 312 328

240 260 393 437 395 438 399 425 462 459 360 432

Comparison of Permits By Units Issued Year to Date 2009-2016 2009 2010 2011 2012 2013 2014 2015 2016

S-F Units 96 137 90 188 273 287 240 265

M-F Units

0 0 0 539 0 539 214 85

Total Units

96 137 90 727 273 826 454 350

^The Single Family number is units and includes both attached and detached units. %Multi-Family units are in buildings with 5 or more units. # 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. Copyright 2016 Home Builders Assoc of Greater Kansas City. All rights reserved.


www.kchba.org | Volume 22, No. 3 | March 2016

Regulations Eased for Threatened Bat Good news for members whose development plans were in danger of being derailed by new regulations regarding the Northern Long-Eared Bat: last month, the Fish and Wildlife Service (FWS) published a final rule that eases some of these restrictions. The “interim rule” restricted the removal of certain trees between April and September — the bats’ migration season — in the Eastern and North Central United States. NAHB submitted comments, and in the final rule, the original quarter-mile buffer around known-roosting sites has been reduced to 150 feet. That gives builders more room for tree-clearing operations to construct homes.

NATURAL GAS IS THE BLUEPRINT FOR SUCCESS. 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, contact Lyn Leet at lyn.leet@kansasgasservice.com or (913) 344-8808.

24

The quarter-mile buffer around hibernation habitat — such as caves and mines — remains the same. However, neither private landowners nor permit applicants need to conduct surveys to determine the bat’s presence on the property. Dropping the survey requirement removes a huge burden for builders, because these surveys were expensive and could only be performed during certain months of the year. Instead, FWS and the Army Corps of Engineers will rely on data from the natural heritage database maintained by each state. NAHBNow, 1/18/16


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