Buildersoutlook2013issue7

Page 1

www.elpasobuilders.com www.epbuilders.org

Builders

utlook

2013 issue 7

NAHB: Code Amendments Can Save Home Buyers, Builders Big Bucks When a state moves to update or modify its energy code, the decision can have major cost repercussions for home builders and home buyers. NAHB's successful effort to amend or prevent adoption of the 2012 International Energy Conservation Code (IECC) in several states was a victory for sensible, flexible, cost-effective regulation. According to the Home Innovation Research Labs' (formerly known as the NAHB Research Center) 2012 IECC Cost Effectiveness Analysis, it costs $7,034 more to build a home to the 2012 IECC than to the 2006 IECC. Bringing the code up the 2012 version would be tremendously difficult and expensive in states that have not updated their codes in recent years. While states often amend codes to fit their specific needs, the 2012 version adds considerably to cost, is less flexible, favors certain products and oftentimes saves little energy. For states that may be contemplating a switch to the 2012 IECC, NAHB has proposed several amendments the states should consider implementing to make the code more cost effective rather than adopting the energy code as published: • Eliminate requirements for insulating hot water pipes in a home. The estimated cost of this provision varies from $500 to $1,000 for an average size house. The energy cost savings would be $5 to $9 per year, meaning it could take as long as 200 years to recoup the additional expense. • Reinstate energy-neutral equipment trade-offs. This would provide builders the flexibility to decide the most cost-effective way to comply with the 2012 IECC. For example, a builder could potentially choose to install a high-efficiency furnace rather than put in additional wall or attic insulation as prescribed by the code. This could reduce the overall cost to both the builder and the consumer.

2012 Energy Code training August 14 8:00 am - 12:00 pm Location: El Paso Assciation of Builders 6046 Surety El Paso, Texas Reservations: 778-5387 Training provided by: "Energy Systems Lab" from Texas A&M Sponsored by: • The City of El Paso • The Lone Star Chapter of the Sierra Club • The El Paso Association of Builders

• Provide the flexibility to ease the air tightness rating requirement for all homes. The 2012 IECC is the only version to mandate this type of testing for all residential buildings. The rating standard varies depending on the climate zone (1 through 8) where a house is located. Fewer than 10% of existing homes nationwide meet the requirements for Climate Zones 3-8 (3 air changes – the number of times air is replaced in a home — per hour when tested at 50 pascals of pressure). Today's new homes are already far more energy-efficient than the existing housing stock. Placing even more stringent requirements on new home construction would be prohibitively costly while only marginally improving energy savings.

• Ease wall insulation requirements in Climate Zone 3. The 2012 IECC increased the wall insulation requirements in Climate Zone 3 (Southeast and South Central U.S.) from R-13 to R-20. Based on NAHB calculations, this will add $1,199 to the cost of a new home. This mandate would provide an energy savings of only about $50 per year, and it would take 24 years to recoup the initial cost. • Reduce wall insulation requirements in Climate Zone 6. The 2012 IECC increased the wall insulation requirements in Climate Zone 6 (northern New England and upper Midwest) from an R-20 cavity insulation to R-20 cavity insulation plus R5 continuous insulation. This is the first time the energy code has included a prescriptive requirement for

continuous insulation. Based on NAHB calculations, this will increase the cost of construction by $1,819 for an average house. With an estimated annual energy savings of $33, it would be 55 years before a home owner would save money on this insulation cost. • Lower basement insulation requirements in Climate Zone 5. The 2012 IECC increased the basement wall requirements from R-10 to R-15 in Climate Zone 5 (a swath of states stretching from coast-to-coast across the central part of the nation). This increase in insulation is expected to cost an average of $590 per house with an associated payback of just $7 per year. That means it would be 84 years before a home owner would net any savings.


2

Builders Outlook

2013 issue 7

WE’RE PROUD TO SERVE THOSE WHO’VE SERVED US ALL.

ONEOK, Inc.

Oklahoma Natural Gas

Kansas Gas Service

ONEOK Partners, L.P.

ONEOK Energy Services

Texas Gas Service provides natural gas to more than 620,000 customers in the state of Texas, including customers in Austin, El Paso, the Gulf Coast and the Rio Grande Valley. Texas Gas Service is a division of ONEOK, Inc. (NYSE: OKE), a diversified energy company. ONEOK is the general partner and owns 43.4 percent of ONEOK Partners, L.P. (NYSE: OKS), one of the largest publicly traded limited partnerships, which is a leader in the gathering, processing, storage and transportation of natural gas in the U.S. and owns one of the nation’s premier natural gas liquids (NGL) systems, connecting much of the NGL supply in the Mid-Continent with key market centers. ONEOK is among the largest natural gas distributors in the United States, serving more than 2 million customers in Oklahoma, Kansas and Texas. Its energy services operation focuses primarily on marketing natural gas and related services throughout the U.S. ONEOK is a Fortune 500 company. For more information, visit www.texasgasservice.com. © 2013


2013 issue 7

3

Builders Outlook

President’s Message | Edmundo Dena

El Paso Disposal

President, El Paso Association of Builders

I’d like to start by sending out my deepest thanks to all the people involved in the Parade of Homes, from the developer Hunt, to the builders, to the association staff, and the great volunteers. I especially want to thank Frank Torres, my Vice President and the chairman of the Parade. He did so much work on this that I really don’t know how to repay him. There are few things that you can say about someone who gave so much effort and time to an event like he did. He’ll tell you he didn’t do it alone and that is true, but Frank just did so much. Thank you Paco, you done everyone proud. Thanks Ray, Margaret, Kathy Parry, Edgar Montiel, Robert Baeza and Lorraine Huit for your efforts during the show. To the dozens of volunteers at the gate thanks for putting up with the thousands of visitors. Our little casita ticket booth has paid for itself over and over again, this time was no exception. Ray has told you that we kind of shut down in July but the work continues even though you may not have a meeting or something. Our calendar is pretty much full with the bowling event and a meet and greet for the Mayor and City Council on the agenda. I hope to have some time off but frankly I’m so busy now that we just have to pull ourselves away or we won’t. Last I’d like to congratulate the recently announced Pioneer Award winners: George D. Thomas (who I worked for); Jack Winton (who I work for now) and Robert Bobby Bowling III (who I respect so much). These awards will be presented at the installation banquet in December. Another event that we’re planning right now. I told you we were busy. Have a safe rest of July and August. Go sell something.

772-7495

Showroom: 2131 Missouri 915 • 533 • 6045

fax • 533• 6096

Thomas R. Brown, Owner


4

Builders Outlook

Perspective

2013 issue 7

|

Ray Adauto, Executive Vice President EPAB

The implosion of El Paso’s city hall was just the start of challenges for their employees and the public. If you are wondering what I mean take a lesson from me and try to understand. First off, there is no official city hall. The reason is simple, not all city employees reside in one ginormous building with elevators and bullet holes. No you see there are city departments here, there, everywhere but just where and who’s there is a little bit more difficult than before. First the Mayor and Council, along with most of the mucky mucks (slang for chiefs or jefe’s) cozied up to renovated office space at the old El Paso Times building. That building however still houses the printing presses for the Times, so it really isn’t just a “city hall”. Parking is a HUGE problem unless you want to pay six bucks at the Wells Fargo parking garage or try to find a meter that takes only quarters, even though it will swallow and not refund dimes and nickels. Even handicap parking is a premium. How many city employees are at this location? I’m sure someone knows but I think it’s pretty easy to play hooky now. Lots of cubicles make the place a lot like a rat maze.

Trying to figure out who’s who and where they might be

Other city departments are housed in the old Tillman Health Center and the old YMCA on Montana. It is presumed that all the “dangerous” medical samples were removed from Tillman and that the rooms at the Y were sanitized as well. Some departments moved in with other departments but here’s what I find most interesting about the dispersed departments. There is no need to have a four day, 10 hour day anymore, if we are to believe the reasoning for it in the first place. According to the City Manager’s office closing city hall on Friday would save on heating and cooling of the building. Since the building is now in a million pieces from the implosion that reason is out the window. Friday is back at your nearby city building. That means that city employees will now be open for business on Friday and those long days of 7am to 6 pm days are just a memory. Many of us, including a lot of businesses from the local Chamber had demanded that Friday be a regular day at the city. Closing down meant that development, permits, and regular city business was closed. Oh well, and so the golf game will have to suffer one more time. New Mayor Oscar Leeser

said so much in his first official day. July is traditionally the month that people in the building trades take time off for vacation or long weekends. The Association doesn’t hold board or general meetings because of that and we also try to take some time off. We look forward to whatever we decide to do in July because the second half of the year is normally pretty busy. We are working on the fall golf tournament, the installation banquet, a speed

ome Your New H eva

Su Casa Nu e e best tim NOW is th new to buy your so! Pa El home in

el Ahora es ra tiempo pa comprar eva nu sa ca a un ! en El Paso

networking event, and some other stuff we can’t mention right now. Stay tuned and get ready for the second half. For those of you going on vacation in August have fun and be safe. If you’ve already been on vacation it’s time to think of the next one.

Reserve your advertising space in the next edition of Your New Home/Su Casa Nueva The most complete home buying guide in both English & Spanish • Unmatched distribution and circulation • Unique dual language layout • Great advertising opportunity Call Margaret today at 778-5387


2013 issue 7

NEWS New-Home Sales Jump 8.3 Percent Sales of newly built, single-family homes surged 8.3 percent to a seasonally adjusted, annual rate of 497,000 units in June, their fastest pace in the last five years, according to data released today by HUD and the U.S. Census Bureau. “New-home buyers are returning to the market in larger numbers as firming prices, shrinking inventories of homes for sale and improving local economies convince them that now is the time to make their move,” said Rick Judson, chairman of the National Association of Home Builders (NAHB) and a home builder from Charlotte, N.C. “Meanwhile, the very low supply of new homes on the market is indicative of the difficulty that builders are having in keeping up with

5

Builders Outlook

demand due to availability issues with regard to materials, credit, labor and lots for development.” “The takeaway from this report is that the housing recovery is solidly on track and isn’t going to be derailed by slightly higher mortgage rates,” said NAHB Chief Economist David Crowe. “After years of fence-sitting, buyers are back and are ready to move forward with an investment in homeownership.” Looking ahead, he said he anticipates further, though more incremental gains in sales through the end of this year. Three out of four regions saw solid gains in new-home sales activity in June, with the Northeast, South and West posting increases of 18.5 percent, 10.9 percent and 13.8 percent, respectively. The Midwest posted an 11.8 percent decline following an above-trend bump in activity in May. The inventory of new homes for sale declined to 161,000 units in June, marking a razor-thin, 3.9-month supply at the current sales pace. The months’ supply of homes for sale has not fallen below this level since March of 2004.

NAHB Seeks Changes to the PATH Act The National Association of Home Builders (NAHB) told Congress in July that it will work with lawmakers to make changes to the Protecting American Taxpayers and Homeowners (PATH) Act legislative proposal to ensure that it provides the federal support necessary to maintain a strong and liquid housing finance system. Testifying before the House Financial Services Committee, NAHB CEO Jerry Howard urged the committee to modify the PATH Act to make sure that the federal government continues to provide a backstop for a reliable and adequate flow of affordable housing credit in all economic and financial conditions. “NAHB believes federal support is particularly important to ensure that 30year, fixed-rate mortgages, the bedrock of the nation’s housing finance system since the 1930s, remain available at reasonable interest rates and terms,” said Howard. “As currently drafted, the

PATH Act does not provide the federal support necessary to ensure a strong and liquid housing finance system, and we urge the committee to make the necessary changes.” There are some positive elements in the PATH Act, and NAHB agrees that private capital must be the dominant source of mortgage credit, Howard said. However, ensuring the safety and stability of the housing finance system cannot be left entirely to the private sector. “The historical record clearly shows that the private sector is not capable of providing a consistent and adequate supply of housing credit without a federal backstop,” he said. NAHB has recommended to the committee that Fannie Mae and Freddie Mac be gradually phased into a private sector oriented system, where the federal government’s role is explicit but its exposure is limited. Federal support would be limited to catastrophic situations where carefully calibrated levels of private capital and insurance reserves would be depleted before any public funds were employed to shore up the mortgage market. NAHB also urged House lawmakers to modify the sections of the bill outlining changes to the Federal Housing Administration (FHA). “The PATH Act would drastically diminish FHA’s vital liquidity mission,” said Howard. “By simultaneously leaving all federal support for housing to FHA, and then by greatly reducing the overall scope and reach of FHA’s programs, the PATH Act would greatly limit homeownership and rental housing opportunities for many financially responsible and qualified Americans.” Because there is currently a great deal of uncertainty among consumers and home builders due to the unresolved debate on reforming the housing finance system and the government sponsored enterprises, Howard urged the committee to move forward in a careful, prudent manner to provide needed assurance for the industry and consumers. “At a time when housing is just starting to get back on its feet and provide job and economic growth, we don’t want to do anything that would reverse this positive momentum,” he said. “It’s definitely important that Congress be mindful of housing’s important role in the economy going forward.” “NAHB looks forward to working with lawmakers to create a sustainable housing finance system that will ensure stability and liquidity in the financial system that supports homeownership and rental housing,” Howard added.

www.elpasobuilders.com www.epbuilders.org

Builders

utlook

2013 issue 3

Growing Labor Shortages Impede Housing and Economic Recovery

308*/( -"#03 4)035"(&4 */ "-'"$&54 0' 5)& 3&4*%&/5*"$0/4536$5*0/ 4&$503 "3& *.1&%*/( 5)& )064*/( "/% &$0/0.*$ 3&$07&3: "$$03%*/( 50 " /&8 4637&: $0/%6$5&% #: 5)& "5*0/"440$*"5*0/ 0' 0.& 6*-%&34 = )& 4637&: 0' 063 .&.#&34 4)084 5)"5 4*/$& 6/& 0' 3&4*%&/5*"- $0/4536$5*0/ '*3.4 "3& 3&1035*/( "/ */$3&"4*/( /6.#&3 0' 4)035"(&4 */ "-- "41&$54 0' 5)& */%6453: < '30. $"31&/5&34 &9$"7"5034 '3".&34 300'&34 "/% 1-6.#&34 50 #3*$,-":&34 #6*-%*/( ."*/5&/"/$& ."/"(&34 "/% 8&"5)&3*;"5*0/ 803,&34 )& 4".& )0-%4 536& '03 46#$0/53"$5034 > 4"*% )*&' $0/0.*45 "7*% 308& )& 4637&: "-40 '06/% 5)"5 .03& 5)"/ )"-' 0' 5)& #6*-%&34 3&1035&% 5)"5 -"#03 4)035"(&4 07&3 5)& 1"45 4*9 .0/5)4 )"7& $"64&% 5)&. 50 1": )*()&3 8"(&4 03 46#$0/53"$503 #*%4 50 4&$63& 130+&$54 "/% $0/4&26&/5-: 50 3"*4& )0.& 13*$&4 03&07&3 1&3$&/5 0' 5)& #6*-%&34 4637&:&% &91&3*&/$&% %&-":4 */ $0.1-&5*/( 130+&$54 0/ 5*.& 1&3$&/5 )"% 50 563/ %08/ 40.& 130+&$54 "/% 1&3$&/5 -045 03 $"/$&--&% 4"-&4 "4 " 3&46-5 0' 3&$&/5 -"#03 4)035"(&4 "35 0' 5)& 3&"40/ '03 5)& -"#03 4)035"(&4 $"/ #& "553*#65&% 50 5)& '"$5 5)"5 ."/: 4,*--&% 3&4*%&/5*"$0/4536$5*0/ 803,&34 8&3& '03$&% 50 4&&, &.1-0:.&/5 &-4&8)&3& %63*/( 5)& 3&$&44*0/ "/% "3& /0 -0/(&3 $633&/5-: "7"*-"#-& =!)"5 64&% 50 #& )*() 1":*/( 4,*--&% +0#4 7"/*4)&% "4 #6*-%&34

"$3044 5)& /"5*0/ 8&/5 065 0' #64*/&44 03 8&3& '03$&% 50 -&5 803,&34 (0 > 4"*% )"*3."/ *$, 6%40/ " )0.& #6*-%&3 '30. )"3-055& )& -044 0' 5&/4 0' 5)064"/%4 0' )064*/( +0#4 .64)300.&% 50 .*--*0/ %63*/( 5)& .03& 5)"/ 1&", 0' 5)& %08/563/ 63*/( 5)*4 1&3*0% ."/: 53"%&4 3&53"*/&% $0/4536$5*0/ 803,&34 "/% 5)&: "3& /05 3&563/*/( 50 5)& 3&4*%&/5*"$0/4536$5*0/ 4&$503 &"/8)*-& " -"$, 0' #6*-%"#-& -054 "/% */$3&"4&% $0454 '03 ."5&3*"-4 "/% -"#03 "3& "-40 $0/53*#65*/( 50 5)& 130#-&. "4 5)& */'3"4536$563& 5)"5 46110354 )0.& #6*-%*/( .07&4 50 3& &45"#-*4) *54&-' '0--08*/( 5)& 80345 )064*/( %08/563/ 4*/$& 5)& 3&"5 &13&44*0/ 308& 4"*% 0 )&-1 .&&5 5)& (308*/( %&."/% '03 4,*--&% -"#03 8*5)*/ 5)& )064*/( 4&$503 5)& 0.& 6*-%&34 /45*565& */ 1"35/&34)*1 8*5) 1307*%&4 $"3&&3 53"*/*/( "/% +0# 1-"$&.&/5 */ 5)& #6*-%*/( */%6453: 0''&34 "/ "33": 0' 1035"#-& 13& "113&/5*$&4)*1 53"*/*/( 130(3".4 */ " 7"3*&5: 0'

4,*--&% 53"%&4 5)"5 $"/ #& $6450.*;&% 50 .&&5 5)& 803,'03$& /&&%4 0' $0..6/*5*&4 "$3044 5)& /"5*0/ 3&(6-"3-: 1-"$&4 "11309*."5&-: 1&3$&/5 0' *54 456%&/5 (3"%6"5&4 */ +0#4 */ 5)& #6*-%*/( 4&$503 =!& "3& 3".1*/( 61 063 &''0354 50 53"*/ %*7&34& 1016-"5*0/4 "/% 1-"$& 5)&. */ +0#4 50 .&&5 5)& (308*/( %&."/% 0' 5)& #6*-%*/( 4&$503 > 4"*% 3&4*%&/5 "/% 0)/ 06340/ = 7&/ */ " 1&3*0% 0' 3&-"5*7&-: )*() 6/&.1-0:.&/5 8& 45*-- /&&% 50 $0.1-&.&/5 063 +0# 53"*/*/( &''0354 #: #3*/(*/( */ '03&*(/ 803,&34 50 .&&5 5)& /&&%4 0' )0.& #6*-%&34 "/% )0.& #6:&34 > "%%&% 6%40/ )& 803,&3 4)035"(&4 "3& /05 0/-: 4-08*/( 5)& )064*/( 3&$07&3: #65 "-40 )635*/( +0# "/% &$0/0.*$ (3085) "5*0/"--: 5)& $0/4536$5*0/ 0' 4*/(-& '".*-: )0.&4 (&/&3"5&4 .03& 5)"/ +0#4 "11309*."5&-: .*--*0/ */ 8"(&4 "/% .03& 5)"/ .*--*0/ */ '&%&3"- 45"5& "/% -0$"- 5"9 3&7&/6&4 )"5 %0&4/?5 &7&/ $06/5

5)& */$3&"4& */ "//6"- 1301&35: 5"9&4 5)"5 -0$"- .6/*$*1"-*5*&4 3&-: 0/ 50 '6/% 4$)00-4 10-*$& "/% '*3&'*()5&34 4 5)& &$0/0.: .&/%4 1&/5 61 %&."/% '03 )064*/( 8*-- $0/5*/6& 50 (308 "4 306()-: .*--*0/ )064&)0-% '03."5*0/4 8&3& %&-":&% "4 " 3&46-5 0' 5)& 3&"5 &$&44*0/ / /03."- &$0/0.*$ 5*.&4 %&."/% '03 /&8 )0.&4 4)06-% #& "#065 .*--*0/ "//6"--: *4 "/5*$*1"5*/( 505")064*/( 45"354 0' 5)*4 :&"3 "/% .*--*0/ */ "4 5)& ."3,&5 $0/5*/6&4 *54 (3"%6"3&#06/% =!& /&&% 50 -00, )0-*45*$"--: "5 5)& )0.& #6*-%*/( */'3"4536$563& 50 .&&5 (308*/( "/% '6563& %&."/% > 4"*% 6%40/ = 0 "70*% " 36/ 61 */ 13*$&4 */ )05 ."3,&54 %6& 50 -"#03 *446&4 8& /&&% 50 $0.1-&.&/5 063 $633&/5 53"*/*/( 130(3".4 8*5) " ."3,&5 #"4&% 7*4" 4:45&. 5)"5 806-% "--08 .03& *..*(3"/54 50 -&("--: &/5&3 5)& $0/4536$5*0/ 803,'03$& &"$) :&"3 8)&/ 5)&3& *4 " %&"35) 0' 803,&34 50 '*-- 5)& +0#4 5)"5 "3& /&&%&% >

Advertise in the

Builders Outlook Call Margaret at the El Paso Association of Builders 915-778-5387


6

Builders Outlook

2013 issue 7


2013 ISSUE 7

7

Builders Outlook

Setting the Record Straight on the Mortgage Interest Deduction default and in foreclosure. Eliminating the mortgage interest deduction would reduce the financial resources families can draw on for education, entrepreneurship and retirement. And if home values fall, then state and local tax revenues fall, making it harder to fund schools, infrastructure, public safety and other important government functions. Repealing the MID have serious economic would consequences. As the Senate examines existing tax policies as part of its “blank slate” approach to tax reform, and as the House Ways and Means Committee continues its review of the tax code, it is appropriate to keep in mind the importance of the mortgage interest deduction (MID) as a middle-class tax provision that makes it possible for many families to achieve homeownership. It is also useful to review some of the claims against the MID to determine if those claims are valid. Economists at the National Association of Home Builders (NAHB) have analyzed data from the IRS and the Census Bureau, as well as estimates from other sources, to assess the validity of these claims. Claim #1: The wealthy get most of the benefit from the mortgage interest deduction. Fact: The majority of the tax benefits from the MID go to middle-class households. Data from the Congressional Joint Committee on Taxation shows that 86 percent of households who benefit from the

mortgage interest deduction have incomes of less than $200,000. It is also useful to keep in mind that the majority of home owning households are married couples, so the household income measure will often include two incomes. Claim #2: Repealing the mortgage interest deduction would not damage the economy or individual households. Fact: Almost all studies examining the elimination of the mortgage interest deduction find that it would reduce demand for housing by raising taxes on prospective home buyers. This reduction in housing demand would also lower home values for existing home owners who would experience a significant loss in wealth. A 1 percent decline in home prices would result in a loss of $185 billion to American households. Just a 6 percent decline would eliminate $1 trillion in household net worth. If repealing the deduction lowered prices by 10 percent or more, Americans would lose trillions of dollars in household net worth. If home values fall, then more families will find themselves under water, in

+

Claim #3: Only a small percentage of home owners claim the mortgage interest deduction. Fact: The mortgage interest deduction is broadly claimed. Seventy percent of home owners with a mortgage claim the MID in a given year, and almost all home owners benefit from the deduction at some point during their homeownership lifecycle. The argument that only an estimated “quarter of taxpayers” claim the deduction is misleading because it ignores the lifecycle element of homeownership. Of the two-thirds of households who are home owners, one-third own free-and-clear with no mortgage. And of those with a mortgage who claim the standard deduction in lieu of the MID, many are in the final years of a mortgage and are paying small amounts of interest and greater amounts of principal. In the early years of their mortgage when much greater amounts went to interest, those home owners very likely claimed the mortgage interest deduction. Claim #4: Repealing the mortgage interest deduction would make the tax code more progressive. Fact: A progressive tax system is one in which taxpayers with lower incomes pay a smaller share of their earnings in taxes than higher income households. Repealing the mortgage interest deduction would result in larger tax hikes – as a share of household income – for the middle class. For example, for households with less than $200,000 in adjusted gross income (AGI), the typical mortgage interest deduction is worth 1.76 percent of that family’s AGI. For taxpayers reporting more than $200,000 in income, the benefit falls to 1.5 percent of AGI. Thus, in the event of repeal, middle-class home owners face a larger tax hike as a share of their income, making the tax system less progressive. Claim #5: The mortgage interest deduction incentivizes buyers to purchase a larger home. Fact: While the mortgage interest deduction is sometimes connected with larger homes, evidence shows that it is more often the case that the tax benefit reflects family size and underlying housing demand. Larger families require a larger home, which in turn means a greater amount of mortgage interest paid and a larger tax benefit. And NAHB analysis of IRS data confirms this. Taxpayers with two personal exemptions (a measure of family size) who claimed the MID had an average tax benefit of $1,500. Taxpayers with four personal exemptions had an average benefit of approximately $1,950. In fact, the benefit increased correspondingly from one dependent to five-plus personal exemptions, which is consistent with the notion that larger families require larger homes.

TM

of Texas

Claim #6: Renters do not support the mortgage interest deduction. Fact: Public opinion polling has generally found the MID to be popular with renters, most of whom hope to become home owners. Given that recent home buyers receive the greatest tax benefits from the deduction, such renters would have much to lose in case of repeal. A 2012 poll found that a majority of renters were opposed to eliminating the mortgage interest deduction.

Claim #7: Because mortgages on second homes also qualify for the mortgage interest deduction, taxpayers are subsidizing vacation homes for the wealthy. Fact: The rules relating to second homes are complicated, and often apply to situations that do not involve a vacation home. The rule allows owners who sell their home and buy another – those who own more than one primary residence in a tax year – to claim the MID for both homes on their annual tax return. The rules also allow home owners who are building a new home to claim construction loan interest as a deduction. And the rules support investment in seasonal residences that provide an economic foundation for many parts of the country. In fact, 49 states in the U.S. have at least one county where more than 10 percent of the housing stock fits the tax definition of a second home. But we are not talking about million-dollar homes on the beach, which are usually paid for in cash or claimed as rental property. According to an analysis of the Consumer Expenditure Survey, the average income of a household with a mortgage on a second home is $71,344. Claim #8: While the mortgage interest deduction supports homeownership, federal policy neglects renters. Fact: Housing policy support, in dollar terms, is roughly proportional to the total population living in renter- and owneroccupied homes. For example, the report of the Housing Commission of the Bipartisan Policy Center, which looked at all of the tax and spending programs for rentership and homeownership, found that about one-third of housing policy spending is attributable to rental housing, which is equal to the share of the population living in that form of housing. Such analysis is important because it shines a spotlight on important housing programs for affordable rental housing, including the Low-Income Housing Tax Credit (LIHTC). Claim #9: Since not all home owners itemize, a credit would be better for the market. Fact: Identifying winners and losers from moving from an itemized deduction to a credit depends on a number of factors, most importantly the tax credit rate. For example, the Simpson-Bowles report recommended a 12 percent tax credit, meaning a tax benefit of 12 cents for every dollar of qualified mortgage interest paid. A revenue-neutral tax credit would be approximately 20 percent. Thus, such a low rate as 12 percent would represent a significant tax hike for home owners. Moreover, it is important to remember that under most MID tax credit proposals, the property tax deduction (worth on average about one-third of the value of the MID) would cease to exist, further increasing the tax burden on home owners. Claim #10: There is too much policy support for housing. Fact: At the federal level, much of the focus on housing tax policy is centered on important and long-standing policies like the MID and the LIHTC, but this focus ignores the fact that home owners pay property taxes that are not collected on other forms of investment. For example, owners of owner-occupied and rental housing pay approximately $300 billion a year in property taxes to local and state governments. Such tax burdens should not be ignored in federal tax debates when considering the overall effective tax rate on housing.


Builders

utlook on the scene |

Bowling Tournament The biannual bowling event that is held by the Associates council took place on July 10 at Bowl El Paso. Thirteen teams bowled for nothing more than their pride and camaraderie with a lot of passion and fun. “This is always a great way to just have a good time and enjoy and afternoon of fun,” said Sam Shallenberger, Associates Chair. “We enjoy the time together and frankly we get to see some friends who won’t do golf or other outdoor events during the summer,” he continued. The bowling lanes welcomed every type of bowler, from the novice to the near professionals like our own Frank Torres and Edgar Montiel. “Sometimes I just have to show my employees that I really do take this game seriously,” said Montiel. “Of course you know that I am kidding, but I think this is a really cool deal that lets us just have a good competitive time together,” Montiel continued. “I have picture proof that I can bowl since Ray took the picture of my score card,” Frank Torres commented. “I know that I really had a good time, almost as well as when I golf, but this is still a good time all around,” he continued. The EPAB congratulates all the participants and we especially thank our KING PIN advertisers, Sierra Title; Tropicana Homes; and Lawyers Title. Our next bowling outing is being planned for some time in November.


2013 issue 7 Build PAC welcomes new Mayor, council The Association conference room was filled with well-wishers as the El Paso Build PAC held a meet and greets for all the City Council and newly elected Mayor Oscar Leeser. The crowd was thrilled to have five sitting city representatives and the Mayor join them for a celebration. “I can’t remember ever having a sitting Mayor and five city representatives in our office ever,” said Bobby Bowling IV. “This event is an indication of the seriousness this council and Mayor place on a business relationship between us and the City of El Paso,” he continued. Each representative gave a quick talk about what they see as the most important issues regarding business in general and home building in particular. “I remember seeing members of the association working hard and employing workers when the economy was down, even at times when they themselves couldn’t make money,” City Representative Eddie Holguin commented to the crowd. “I will always remember that this group kept going even when others gave up,” he continued. Emma Acosta, City Rep for District 3 reminded the gathering that the meet and greet and association building is in her district. “I want to welcome all of you to District 3,” she said, pointedly. “What a great event on top of a great relationship that I personally think I have with the builders,” she said. Carl Robinson was equally praiseworthy saying “I know that when we’ve had battles in the past we have fought together for the good of El Paso, always for the good of ALL El Paso.” Newly elected City Representatives Lilly Limon (District 7) and Larry Romero (District 2) told the PAC and visitors how much they appreciated the support during the election. The vowed to ensure that City hall and the employees understand how important it is to business friendly. “I have to tell you that it may take me a little while to totally grasp all the complexities involved at the City but I’m a quick learner,” Limon told the audience. The evening was made even better with the outstanding food prepared by El Paso’s own Chef Adam Alper, executive and owner of Club Gourmet. “When Ray approached me to cater the event I knew that if Mayor Leeser was coming I had it all figured out since he and I go back a while,” Chef Adam told the Outlook. The overwhelming positive response from all the attendees confirmed that Chef Adam had done his homework and offered the celebrants something to remember. “This wasn’t a pig in a blanket night was it.” said Edmundo Dena. “We are so blessed to have had one of the best, if not the best events ever at the EPAB. I’m proud to say it was during my tenure as President,” he reminded all those within earshot.


10

Builders Outlook

2013 issue 7

Going Green: Eight Great Green Building Trends In 2013, Green Building continues to grow and expand in all corners of the globe. More importantly, things such as client and market demand, lower operating costs, and public relations opportunities are being cited as reasons for this growth, according to the Global Green Building Trends Report. This certainly leads one to conclude that green building is taking hold and will continue to influence building in the years ahead. With this in mind, here are eight green building trends to be aware of: Greening of Existing Buildings Half of the firms surveyed in the Global Green Building Trends Report have mentioned plans for green retrofits to an existing building in the next three years. In fact, certifications for LEED for Existing Buildings Operations and Maintenance (LEED O+M) have already exceeded new construction certifications in terms of total floor area! With a little shorter payback period, and similar expectations for reduced operating costs and increased building values when compared to new green buildings, there’s no surprise that firms are increasingly looking at renovation options for increasing the environmental benefits for existing structures. Disclosing Green Building Performance Increasingly, more cities and states will join the likes of Washington D.C., Seattle, New York, San Francisco, Washington state, and California in requiring buildings, especially large buildings, to perform energy audits. Audits consist of reporting utility data to a governing body, along with building size, configuration, and age to allow for benchmarking. This data can then be made available to tenants, buyers or even the public at large in hopes of influencing investment in energy efficiency. Water Conservation Already a major factor in building in many parts of the world, water conservation will continue to get more emphasis in the U.S. Rainwater capture systems and other devices that will help reduce water use and improve water efficiency will become increasingly common building design elements. Net-Zero Energy Buildings As builders look to differentiate their buildings in terms of energy efficiency, they will begin to turn to net-zero energy buildings. These buildings represent the pinnacle of energy efficiency, for now, and provide greater marketing and branding opportunities than LEED or Energy Star certifications. (Check out GBTV coverage of the Green Leaf Inn; first net-zero energy hotel being built in North America.) Avoiding “Red List” Chemicals As LEED begins to award points for avoiding materials proven to be harmful to human health and the environment, look for builders to place a larger emphasis on using

alternatives to these materials. Building product manufactures will likely begin to market to this trend with more openness about their products contents as they look to differentiate their products. Certainly something to be on the lookout for. Green Building Mandates A step above simply disclosing green building performance, cities and states will also begin to mandate environmental building requirements. Applying mostly to public and large scale private buildings, though eventually to all buildings, these mandates will strong arm efforts to conserve energy and water and promote recycling, and use of more sustainable materials. Nearly two dozen

large cities have already codified such mandates. More Solar! The culmination of the increased push for net-zero buildings and new building mandates from governments is that solar will take an even greater role in green building. Whether home based systems, larger systems financed through third parties, or solar collectives – solar energy will increasingly be integrated into green building plans. Emerging practices such as solar air-conditioning and building integrated photo voltaic, where solar panels serve as materials in parts of the building envelope, should also help spur further solar incorporation.

Home and Building Automation Though much of the technology for home or building automation has existed for years, it is now becoming easier to use and more affordable. These systems come in all sorts of forms, from the simple to the complex, and have proven to be an adequate line of defense against energy waste, especially from HVACs, lighting, and appliances. Builders should continue to integrate these systems into old and new buildings alike. Source:http://greenbuildtv.com/blog/8-great-greenbuilding-trends/


2013 issue 7

11

Builders Outlook

The options builders asked for are right here. Developed with the backing of the strongest insurance carriers serving the Texas building industry, the exclusive TAB endorsed insurance program offers new flexible options and rates that are more competitive than ever before.

Give your customers the ‘option of the sun’ Now more than ever, El Paso home buyers are planning for the future.

Program Highlights t i"w SBUFE BENJUUFE JOTVSBODF DPNQBOJFT TFWFSBM PQUJPOT BWBJMBCMF t (- PĂŞFSJOH DPWFSBHF GPS QSPQFSUZ EBNBHF UIBU SFTVMUT GSPN GBVMUZ defective, or poor workmanship in your work t (- MJNJUT PG VQ UP NJMMJPO BOE IJHIFS BWBJMBCMF t &YQBOEFE QPMJDZ GPSN GPS DPNNFSDJBM QSPKFDUT t #VJMEFS T 3JTL NBTUFS QPMJDJFT NPOUIMZ SFQPSUJOH BOOVBM BOE POF TIPUT t 8PSLFST $PNQ UXP IJHIMZ DPTU FĂŞFDUJWF QSPHSBNT t &YDFTT -JBCJMJUZ GPS DPNNFSDJBM HFOFSBM DPOUSBDUPST t $PNNFSDJBM 6NCSFMMB

Contact your local approved agent today! El Paso, Permian Basin and Surrounding Area )6# *OUFSOBUJPOBM *OTVSBODF 4FSWJDFT -BODF 7BO %FNBO $-$4 www.builderagentnetwork.com www.hubinternational.com

Border Solar can help you oer your customers solar power as a sensible alternative.

Crossing to Clean Energy

7365 Remcon Circle El Paso, TX 79912 (915) 613•4168

The future starts today. follow us on twitter and facebook: BorderSolar

www.bordersolar.com

Call 778-5387 for more information today.


12

Builders Outlook

2013 issue 7

Expert Advice

What’s trending in Hardware?

David De Rego Hardware Specialities & Glass Co., Inc.

Why You Need Keyless Entry Locks Imagine juggling bags of groceries while fishing for your keys is a frustration most people have experienced at one time or another. Holding a squirming child in your arms as you struggle to get the door open only increases the challenge. Try doing these tasks in the dark and you’ll fully appreciate the convenience behind home automation and keyless entry locks. Keyless Entry Systems Increase Personal Safety Just a few things are more frightening than approaching your front door with the fear that someone is following close behind you. Your gut wrenches as you fumble for your keys, praying you can open the door quickly. Wouldn’t it be great to be able

to unlock the door, turn on a light and activate a camera with a button click from twenty feet away? Using a key fob transmitter or your smart phone for remote control access to your home introduces a whole new dimension to your home security system. You can unlock the door and turn on the porch light as you walk up the pathway or pull into the driveway. For a small investment, you can provide a security feature for you and your loved ones that is priceless. Where Home Automation Fits In Many keyless lock systems exist that have nothing to do with home automation. Those systems lack the flexibility afforded from a home automation keyless entry system. When compatible products such as cameras, light modules and thermostats are integrated with your home automation system, your doors can be locked or unlocked, video surveillance can be enabled, lighting can be controlled and the temperature of your house can be maintained to a comfort level of your choosing from anywhere in the home and even anywhere in the world as long as you have an active internet connection. No longer will you need to get out of bed to let the kids in late at night or adjust your thermostat.

Finding the Right Keyless Entry Products No one solution fits everyone. You may prefer doorknobs with a brass finish or a satin one. You might want a standard latch or a deadbolt. Perhaps you like levers instead of knobs. You may even need to use a keyless entry on a sliding door. Whatever type of door you’re looking to automate, there is a solution for you. \ Some questions you will need to answer before you start shopping include: • Do you want the keyless lock to look like a normal doorknob, deadbolt or both? • Do you want to operate the door using a remote control, and if so, how many remotes will you need? • Would you like to use a smart phone instead? • Do you want your system to be scalable? • Do you want a system that is electric, battery-powered or both? • Will you want to unlock the keyless door before you get out of your car? • Are you interested in self monitored home security • Will you want to allow or restrict access to your home without having to hand out keys?

• Do you want to save money on your utility bills? With technology becoming more and more advanced choices are plenty and overall costs are far more reasonable giving you better peace of mind. For more information consult your local home automation professional or the specialized hardware distributor in your area.


2013 Issue 7

13

Builders Outlook

Membership News www.elpasobuilders.com

UPCOMING EVENTS | AUGUST 5 ASSOCIATES MEETING 3:00 EPAB OFFICE

AUGUST 8 11:00 BOARD MEETING 12:00 GENERAL MEETING EL PASO CLUB CHASE BANK BLDG.

RENEWALS | AJP Delvelopment Casa Ford & Casa Nissan Dunn Edwards Wellborn Paint Hardware Specialties Icon Custom Home Builder Longhorn Remodeling & Roofing Mission Homes Ramos Drilling & Water Treatment TRE & Associates United Bank Of El Paso Del Norte

SODA SPONSOR | Thanks to our JULY SODA  SPONSOR: Rassette Homes

Jaime’s Courier Service,Inc. 915-549-4533 or 915-478-2404 11395 James Watt, Suite A-11 79936 915-633-8002

Bonded, insured for your peace of mind.


14

Builders Outlook

2013 issue 7

Record number of visitors attend Parade of Homes The 2013 El Paso Association of Builders/HUNT Parade of Homes finished with a flurry of visitors and buyers. The show which lasted 17 days set some high visitor records as over 7200 persons came through the gates during show hours. The strongest attendance days were traditional weekend days Saturday and Sunday. This year there were 13 homes in the Parade and every one of them showcased ideas and layouts that El Pasoan’s were anxious to see. “We set out to build a nice home to start with and then we just kept adding to it and adding to it until we felt that we had something unique to offer in the show home,” said Mark Dyer of the Winton/Flair home on display. “I can honestly say that we had features that just stood out,” said Danny Andrus of Trinity Homes. The Parade of Homes kicked off with a sold out preview party that saw over 1300 visitors come in on that night alone. “We were slammed at the gate,” said Margaret Adauto of the El Paso Association of Builders. “Between Kathy Parry, Ray and myself we greeted the throng of people until we couldn’t move anymore,” she said. The participating builders were: Palo Verde; Crown Heritage; Pointe Homes; Icon Custom Homes; Winton/Flair Homes; Trinity Homes; Punto Living; R

C Baeza; M A Homes; Quality Craft Homes; Joseph Homes; Bella Vista Homes and Phillips Homes. The subdivision belongs to HUNT and is a master planned smart code community. The subdivision is in the Canutillo School District that just announced a combined grade and Middle school bearing the name of Silvestre and Carolina Reyes. The ground breaking ceremony was to be held in mid-July. In response to the great turnout Kathy Parry of HUNT said this: “The numbers are incredible and illustrate the pent up demand by the public to have a show like this. We are thankful for all that the Association did to get the word out and for all the dedicated volunteers that manned the ticket booth”. Adding his own compliments Ray Adauto, Executive Vice President of the El Paso Association of Builders said “The Association is grateful to HUNT and the 13 builders who spent hundreds of hours planning, executing and presenting these beautiful homes.” “We want to single out Parade Chairman Frank Torres, Vice President of the EPAB for his tremendous work putting the show on,” Adauto said. As of press time the builders had contracts on six of the 13 homes and several sales have been generated through the show on different lots located around the Parade area.

Call 778-5387 for more information today.


Builders

utlook

www.elpasobuilders.com www.epbuilders.org 6046 Surety Dr. El Paso, TX 79905 915-778-5387 • Fax: 915-772-3038 ■ execuTive oFFicerS edmundo Dena – President Accent Homes Frank Torres – vice President GMF Custom Homes edgar montiel – Secretary/Treasurer Palo Verde Homes Sam Shallenberger – Associates chair Western Wholesale Frank Arroyos- immediate Past President Cisco Homes ray Adauto – executive vice President El Paso Association of Builders

■ TAB STATe DirecTorS Doug Borrett, Karam Co., Life Director Randy Bowling, Tropicana Homes ■ NATioNAL DirecTorS Bobby Bowling IV. Demetrio Jimenez NATioNAL ASSociATioN oF Home BuiLDerS (800) 368-5242

TexAS ASSociATioN oF ■ couNciL/commiTTee cHAirS Associates council Sam Shallenberger Build PAc Randy Bowling Desert Green Building council Javier Ruiz Land use council Sal Masoud Young Designer Award John Chaney remodelers council Rudy Guel membership retention Mike Santamaria, Greg Bowling Finance committee Edgar Montiel Women’s council Lorraine Huit ■ ADviSorY To THe BoArD J. Crawford Kerr, Attorney, Firth, Johnston & Martinez ■ BoArD oF DirecTorS Juanita Garcia, Icon Custom Builders Samira Gonzalez, Edwards Homes Walter Lujan, Dawco Construction Carlos Villalobos, Pointe Homes Don Rassette, Rassette Homes Beverly Clevenger, Automated Division 6 Builders Frank Spencer, Aztec Contractors Kathy Parry, Hunt Communities Sal Masoud, Del Rio Engineering Robert L. Foster, Southwest Land Development Services Leti Navarette, Custom Dream Homes Linda Troncoso, TR-Engineering Lance VanDeman, Hub International John Chaney, Passage Supply Joe Bernal, El Paso Employee Benefits Ken Wade, El Paso Building Materials Ruben Orquiz, MTI Ready Mix Kathy Carrillo, Pioneer Bank Henry Tinajero, West Star Bank Paul Zacour, Zacour & Associates Chuck Gabriel, Carpets West Ted Escobedo, Snappy Publishing Lorraine Huit, Cardel Design Javier Ruiz, Border Solar & Senercon

BuiLDerS (800)252-3625

2012 Builder member of The Year Frank Arroyos Cisco Homes 2012 Pat cox Award Mike Santamaria Mountain Vista Homes 2012 Associate of The Year Sam Shallenberger Western Wholesale Supply John Schatzman Award Hunt Companies

Honorary Life members Rudy Guel Brad Roe Cliff Anthes Wayne Grinnell Chester Lovelady Don Henderson Anna Gil

Past Presidents committed to Serve Greg Bowling Kelly Sorenson Mark Dyer Mike Santamaria John Cullers Randy Bowling Doug Schwartz Robert Baeza

Bobby Bowling, IV Rudy Guel Anna Gil Bradley Roe Bob Bowling, III E. H. Baeza Hershel Stringfield

ePAB mission Statement: The El Paso Association of Builders is a federated professional organization representing the home building industry, committed to enhancing the quality of life in our community by providing affordable homes of excellence and value. The El Paso Association of Builders is a 501C(6) trade organization. © 2013 Builder’s Outlook is published and distributed for the El Paso Association of Builders by Snappy Publishing 240 Thunderbird • Suite C El Paso • Texas • 79912 915-820-2800


DEVELOPING DREAMS. IN EAST AND WEST EL PASO.

Hunt is developing family focused neighborhoods in both east and west El Paso. Our communities feature amenities such as neighborhood parks, walking trails, bike paths, and landscaped roadways. Only in a community by Hunt will you find home options for everyone – from the first-time buyer to those searching for their ultimate dream home.

EAST Horizon Mesa

Eastlake Boulevard to Horizon Mesa Boulevard

Emerald Estates

Eastlake Boulevard to Emerald Park Drive

Emerald Pass

Eastlake Boulevard to Emerald Sands Drive

Mission Ridge www.liveatmissionridge.com I-10 and Eastlake Boulevard

WEST Cimarron www.liveatcimarron.com Helen of Troy at Redd Road

www.huntcompanies.com


Turn static files into dynamic content formats.

Create a flipbook
Issuu converts static files into: digital portfolios, online yearbooks, online catalogs, digital photo albums and more. Sign up and create your flipbook.