After weeks of debate, Congress passed a $787 billion economic stimulus bill that includes a tax credit of $8,000 for first-time home buyers who purchase a principle residence between Jan. 1, 2009, and Dec. 1, 2009. President Obama is expected to sign the bill on Tuesday, Feb. 17.
While this bill is disappointing to the home building industry, there are positives for our industry. This bill eliminates the repayment provision of the $7,500 tax credit that was already in place, and thus makes this a much better selling tool for builders and realtors. Secondly, all indications point to the Obama Administration turning their attention to a housing and finance bill, so there is still an opportunity for the housing industry to shape policy.
You may be thinking that all of your calls and letters to our representatives in Congress were a waste of time. This is not the case. There is no doubt that we got the attention of our delegation with the thousands of phone calls and petitions that were faxed and hand-delivered. In fact, Sen. Richard Burr was quoted last week as being opposed to the compromise bill, due in part to the fact that it does little for housing. "If the theory behind stimulating the economy is you got to go in big, you make a splash, don't stick a toe in, how can they take a component like housing and cut it...?" Burr asked.
Our representation is beginning to understand how important housing is to the U.S. economy, thanks to our efforts. Now that we have their attention, when it comes time to negotiate the housing and finance bill, we may need your help again. A phone call or petition takes only minutes of your time and hopefully will pay huge dividends for our industry. Thank you for all of your efforts to "Fix Housing First."
Specifically, the legislation improves upon the existing first-time buyer tax credit by: - Raising it to $8,000 and removing its payback provisions;
- Extending its sunset date to Dec. 1, 2009; - Keeping it refundable (or claimable regardless of tax liability); - Allowing tax credit home buyers to participate in the mortgage revenue bond program; and - Permitting state housing finance agencies to help buyers at closing by advancing the credit amount as a loan using tax-exempt bond proceeds.
The final stimulus bill also includes several other provisions that will help small businesses and otherwise bolster the housing market. For example, it will: - Reinstate FHA, Fannie Mae and Freddie Mac loan limits of $729,750 in high-cost areas through the end of this year;
- Temporarily allow exchange of LIHTC allocating authority for tax-exempt grants and appropriate $2 billion in HOME funding for affordable housing projects;
- Provide up to a 10-year deferral of tax due to business debt restructuring;
- Expand the net operating loss carryback period for small businesses from 2 years to 5 years for losses arising in the 2008 tax year; Extend the 25C existing home remodeler credit through the end of 2010,
- Increase the credit rate from 10% to 30%, increase its lifetime cap from $500 to $1,500, and expand the set of qualifying property; Provide an Alternative Minimum Tax (AMT) patch for 2009;
- Increase bonus depreciation and Sec. 179 small business expensing for business investment in 2009;
- Increase the New Markets Tax Credit allocating authority for 2008 and 2009; and
- Delay for one year the start of the 3% government contractor withholding requirement (from 2011 to 2012).
Once this legislation is signed in to law, NAHB will be reaching out to members and local HBAs with information and marketing tools aimed at making home buyers aware of the tax credit and helping builders utilize other aspects of the legislation to benefit their businesses.
Congratulations to the Appalachian State University NAHB Student Chapter for taking home fourth place and Rookie of the Year honors at the Residential Construction Management Competition during last month's International Builders' Show.
The annual competition officially began in the fall, giving teams approximately three months to complete a construction project modeled after an actual Centex Homes development in San Antonio, Tex. The 2008-2009 competition featured 66 teams, in three divisions: four-year universities, two-year colleges and secondary schools.
All had to demonstrate their knowledge of the home building process, from start to finish. Students submitted their work to the judges prior to the show and spent the final weeks of the competition preparing for their presentations at IBS. For three grueling days, the judges — who were real project members from NAHB-member companies — listened to presentations and challenged the students to defend their work. The competition culminated on Jan. 21 with an awards ceremony at Caesars Palace attended by more than 1,100 people.
East Carolina University and Western Carolina University also participated in the competition.
The NAHB Student Chapters program is administered by the Home Builders Institute, the workforce development arm of NAHB.
The Avery County Board of Elections officially certified results of the Feb. 3 special election in Avery County to implement a land transfer tax. The measure failed by 35 votes, with 1,449 voting against the tax and 1,414 in favor. Officials initially thought the measure had passed after some polling places erroneously reported results on election night.
The latest result marks the 24th consecutive time that a county land-transfer tax has failed to earn favor with North Carolina voters since November 2007. The Avery County vote was the closest the tax has come to passing, with other referenda failing by an average of 75 percent to 25 percent.
The NCHBA Regional Meetings held Feb. 2-6 were very successful. In summary, 43 of the sixty local HBAs (72 percent) were represented at the nine regional meetings that were held. More importantly, however, these 43 locals represented more than 90 percent of our membership in the nine regions that held meetings. Thus, it is clear that the meetings were an unqualified success in reaching the leadership of our local associations that represent nine out of 10 of our members statewide.
Our leadership and staff will be working on those issues raised that necessitate our attention. Thanks to all who participated in these meetings. Your participation has helped us focus on issues important to the grassroots. Now, we hope your participation will extend to the next level: attendance at one of our upcoming state quarterly meetings. If you will come once, we promise you will want to come back.
The Region VIII meeting in Conover was cancelled due to inclement weather and will be rescheduled for March.
Be sure to look for an in-depth description of the regional meetings in the March issue of North Carolina Builder.
The “Employee Free Choice Act”--better known as the Card Check bill--is a proposed law that would change how unions are allowed to organize workers in the United States. Big labor unions like the AFL-CIO, SEIU, and the Change to Win Coalition spent heavily during the 2008 elections (estimated at $4.7 million in NC), and are hoping their hard work will not go ignored. Nationally, union membership has been declining and the unions hope the Card Check bill will reverse that trend. If the Employee Free Choice Act is passed, it would change the entire landscape of the business community.
In May 2008, NAHB unanimously approved a resolution that urged Congress and the Administration to oppose any effort to replace the current secret ballot process with a less private unionization vote or “card check” system. NAHB is part of a group called the Coalition for a Democratic Workplace (www.myprivateballot.com) that opposes the Card Check bill. NCHBA’s Government Affairs staff is participating in the North Carolinians to Preserve Employee Choice, a coalition of North Carolina businesses and trade associations that will oppose measures that weaken North Carolina’s laws and tradition as a Right-to-Work state.
We Need Your Help!
The group Americans for Prosperity has organized two events this week (in Greensboro Feb. 16 and in Raleigh Feb. 17) that aim to draw attention to North Carolina’s widespread opposition to this bill. Click here for a flyer for the events. Please consider promoting these events to your membership, especially if you are in the greater Greensboro or greater Raleigh areas. While we are just beginning our grassroots efforts against this legislation, a strong showing at these events will be extremely helpful in influencing folks, such as Senator Kay Hagan, who remain “undecided” on the issue.
Two associations are offering the "Green Building for Building Professionals" and "Business Management for Building Professionals" classes. These classes are part of the NAHB Certified Green Professional designation.
The Hickory & Catawba Valley Home Builders Association classes are scheduled for March 30-31 and April 1. Carl Seville of Seville Consulting is the instructor. Classes will be held at the Hickory Metro Convention Center. See flyer for cost and registration information.
The High Country Home Builders Association classes are scheduled for April 1-2 and April 3. Michael Chandler is the instructor for Green Building for Building Professionals and J. Wallace West will teach the Business Management course. Classes will be held at the Builders Plaza in Boone. See flyer for cost and registration form.
The N.C. Building Code Council will meet March 9-10. The council will hold a work session at 9 a.m. on March 9, followed by a public hearing at 1 p.m. The council meeting will be held at 9 a.m. on March 10. For more information, visit the N.C. Department of Insurance Building Code Council Web site at http://www.ncdoi.com/OSFM/Engineering/BCC/engineering_bcc_calendar.asp.
The Spring 2009 North Carolina Builder Institute session is scheduled for March 3-5 at the McKimmon Center in Raleigh. Registration is now open for a wide range of courses.
The North Carolina Home Builders Educational & Charitable Foundation, Inc. is now accepting nominations and applications for its college scholarships. The foundation awards scholarships based on a combination of need and merit to four-year college students entering their junior or senior year and technical school students entering their second year who have declared their major in a construction related field.
To be eligible a student must meet the following criteria:
Applicants must be nominated by a NCHBA member firm.
Nominees shall be immediate family members - related by blood, (i.e. children, step-children or grandchildren). Students related by marriage, (i.e. son-in-law, daughter-in-law, etc.) shall not be eligible.
Immediate family members of any current trustee of the NCHB Educational & Charitable Foundation, Inc. shall not be eligible.
Awards are for one year, but scholarship winners may submit a renewal application and be considered for renewal if they make satisfactory progress in their studies.
Only full-time students will be considered. NCHBA defines a full-time student as one taking a minimum of 12 credit hours per semester.
The deadline for entries is April 30, 2009. For a nomination form or an application packet, contact NCHBA at (800) 662-7129; (919) 676-9090 or e-mail: . Mail completed applications to: North Carolina Home Builders Association (NCHBA), P. O. Box 99090, Raleigh, NC 27624.
NAHB Publishes Resources for Media Covering Housing and the Economy Each year, the National Association of Home Builders (NAHB) prepares a list of the release dates for major housing economic indicators collected and reported by NAHB and various government agencies and provides it to media who report on housing. Members of the press can access NAHB's Housing Market Index and statistics on housing starts, building permits and other government data through NAHB. Click here for the entire article.
Builder Confidence In Multifamily Market Remains Low The deepening recession and ongoing credit crunch continue to drag down builder confidence in the multifamily housing market, according to the latest results of the Multifamily Rental Market Index (MRMI) and Multifamily Condo Market Index (MCMI), released today by the National Association of Home Builders (NAHB).
“Job losses and tightening credit continue to depress current and future multifamily construction,” said David Crowe, NAHB’s Chief Economist. “Without job growth as a demand driver for rental apartments, new construction is declining. And without access to credit, the pipeline for future construction is running dry.” Click here for the entire article.
