All posts by Editor

Federal Code Mandates Costly and the Wrong Approach to Boost Energy Efficiency

The National Association of Home Builders (NAHB) today urged Congress to oppose any federal mandates that require the adoption of more stringent building codes because it would harm housing affordability, prevent healthy competition in the marketplace and may not achieve the intended results.

Testifying on behalf of NAHB before the House Select Committee on the Climate Crisis, Jimmy Rutland, a home builder and developer from Montgomery, Ala., said that maintaining housing affordability must be the cornerstone to any efforts to create cleaner and stronger homes.

“Any efforts to improve or increase the efficiency or resiliency of the U.S. housing stock should focus on cost-effective, market-driven solutions,” said Rutland.

New homes built to modern codes are efficient, safe and resilient, which makes increasing code stringency unnecessary, Rutland told lawmakers. “Similarly, because the codes are nearing a point of diminishing returns in terms of the cost-benefit ratio, additional updates may not be cost effective.”

As policymakers seek to improve efficiency and mitigate the effects of future natural disasters, they need to create opportunities and incentives to facilitate upgrades and improvements to the older homes, structures and infrastructure that are less resilient to natural disasters. A full 130 million homes out of the nation’s housing stock of 137 million were built before 2010, and therefore, were not subject to the new building codes now in effect.

“Since these homes also represent the biggest energy users and are the least resilient, programs and policies that focus on the existing housing stock would reap the most benefits,” said Rutland.

He also stressed the following points to lawmakers:

  • State and local governments must retain authority over land use and their code adoption processes so they can continue to direct community development and implement the codes that best fit their jurisdictions.
  • Climate change mitigation programs that recognize and promote voluntary-above code compliance have a proven track record and demonstrate that mandates are not necessary.
  • Incentives play an important role in providing home owners a cost-effective way to invest in energy efficiency and resiliency. Mandates, which fail to consider the needs or desires of consumers, lack the flexibility needed for realistic, widespread application, and add unnecessary costs to home construction and retrofits, are an unwise approach to improving efficiency and home performance.

Original Source

Single-Family Housing Starts Hold Firm in September

Due to a decline in multifamily housing starts, total housing starts fell 9.4 percent in September to a seasonally adjusted annual rate of 1.26 million units, according to a report from the U.S. Housing and Urban Development and Commerce Department.

The September reading of 1.26 million starts is the number of housing units builders would begin if they kept this pace for the next 12 months. Within this overall number, single-family starts increased 0.3 percent to 918,000 units. The multifamily sector, which includes apartment buildings and condos, fell 28.2 percent to a 338,000 pace.

“Single-family builders continue to see positive conditions for housing, and this is reflected in NAHB’s Housing Market Index, which measures builder sentiment,” said Greg Ugalde, chairman of the National Association of Home Builders (NAHB) and a home builder and developer from Torrington, Conn. “However, builders are still being somewhat cautious as they continue to deal with supply-side challenges which impact housing affordability.”

“Multifamily housing starts fell from an unsustainably high level in August and are running at a solid pace despite the sharp monthly decline,” said NAHB Chief Economist Robert Dietz. “Meanwhile, the rebound for single-family construction continues. Single-family permits have increased since April, and single-family starts have posted gains since May. In another positive development, September marked the first monthly increase for the number of single-family homes currently under construction since January.”

On a regional and year-to-date basis, combined single-family and multifamily starts in September rose 6.0 percent in the South. Starts declined 0.6 percent in the Northeast, 6.2 percent in the Midwest and 12.2 percent in the West.

Overall permits, which are a harbinger of future housing production, fell 2.7 percent to a 1.39 million unit annualized rate in September. Single-family permits increased 0.8 percent to an 882,000 rate while multifamily permits declined 8.2 percent to a 505,000 pace.

Looking at regional permit data on a year-to-date basis, permits rose 8.1 percent in the Northeast and 3.4 percent in the South. Permits fell 4.9 percent in the Midwest and 3.5 percent in the South.

Original Source

Remodelers’ Confidence Holds Steady in Third Quarter of 2019

The National Association of Home Builders’ (NAHB) Remodeling Market Index (RMI) posted a reading of 55 in the third quarter of 2019, remaining stable from the previous quarter. The RMI has been consistently above 50—indicating that more remodelers report market activity is higher compared to the prior quarter than report it is lower—since the second quarter of 2013. The overall RMI averages current remodeling activity and future indicators.

“Remodelers are reporting increased activity, especially in areas of the country impacted by recent natural disasters,” said NAHB Remodelers Chair Tim Ellis, CAPS, CGP, CGR, GMR, Master CGP, a remodeler from Bel Air, Md.

Current market conditions fell one point from the previous quarter to 54. Among its three major components, major additions and alterations dropped one point to 52, minor additions and alterations decreased by two points to 53 and the home maintenance and repair component rose one point to 57.

The future market indicators gained two points from the previous quarter to 57. Calls for bids increased by one to 55, amount of work committed for the next three months gained two points to 54, the backlog of remodeling jobs increased one point to 59 and appointments for proposals jumped by five points to 60.

“The demand for remodeling is fueled by a healthy labor market and low interest rates,” said NAHB Chief Economist Robert Dietz. “However, the remodeling market is still constrained by high costs and lack of skilled labor.”

For the full RMI tables, please visit www.nahb.org/rmi. For more information about remodeling, visit www.nahb.org/remodel.

Original Source

MGM Resorts Selling Bellagio Assets to Blackstone for Approximately $4.2 Billion

MGM Resorts International (NYSE: MGM) said it has agreed to form a joint venture with Blackstone Real Estate Income Trust (BREIT) that will acquire MGM’s Bellagio real estate assets. MGM will receive a 5% stake in the joint venture and cash of approximately $4.2 billion.

MGM Resorts is a tenant of MGM Growth Properties LLC (NYSE: MGP).

The joint venture will lease the Bellagio assets back to a subsidiary of MGM Resorts for an initial annual rent of $245 million.

Original Source