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7
EL PASO
BUILDERS
A S S O C I AT I O N O F
National, State & Local
Building Industry News
2017: Issue 9
Study Finds Green The latest in a series of studies As consumers become more familiar home builders are less concerned about
Home Building
conducted by Dodge Data & Analytics in with the impact that their homes can higher start-up costs than in previous
partnership with the National Association have on their health and well-being, we studies. There was also a decline among
Continues to Gain
of Home Builders (NAHB), the study wouldnt be surprised to see the influence people who think consumers will not pay
shows that green homes are continuing of this factor continue to grow, said additional costs for green building.
Traction
to gain market share. Steve Jones, Dodges Senior Director of Finally, between one half and two thirds
At least one third of single family and Industry Insights Research. Homes are of respondents say seven different
multifamily builders who were surveyed following the larger trend that Dodge has drivers are pushing them to build green,
said that green building is a significant been tracking across commercial and instead of one or two drivers as in the
portion of their overall activity (more than institutional sectors for healthier buildings past. In fact, these top drivers, selected
60 percent of their portfolio). By 2022, to become an increasingly important part by between 64 and 57 percent of single
this number should increase to nearly of being sustainable. family builders, include customer
one half in both the single family and The report also found that a demand; greater availability and
multifamily sectors. Within this group, considerable number of builders are affordability of green products; the
nearly 30 percent of multifamily builders developing net zero homes or plan to prospect of producing a higher quality
fall into the category of dedicated green build net zero homes in the near future. home; appraisers recognizing greater
builders (more than 90 percent of their Among those surveyed, 29 percent of value in green homes; government or
portfolio). On the single family side, the single family home builders have built a utility incentives; and changes in codes,
percentage of dedicated green builders net zero home in the past two years, and ordinances and regulations.
is nearly 20 percent, but that share is 44 percent expect to do so in the next Multifamily builders see government or
expected to grow sizably by 2022. two years. Builders see increased utility incentives; customer demand; and
These findings show that green customer demand and a competitive changes in codes, ordinances, and
building has become an established part advantage as the top two drivers to regulations as the top drivers for future
of the residential construction landscape, develop net zero homes. green building activity. With respect to
One third of builders surveyed say said NAHB Chairman Granger Another reason for the rise in net zero green building obstacles, multifamily
green building is a significant share of MacDonald, a home builder and homes is the increasing use of renewable builders are most concerned about the
overall activity, and many have built a net developer from Kerrville, Texas. It is no technologies, especially solar costs associated with green; higher start-
zero home. longer a niche business; our members photovoltaic panels. In two years, the up costs; and the unwillingness of
Green construction is rapidly gaining recognize the value of building green and percentage of builders who used these consumers to pay more for green
traction among both single family and are incorporating these elements into panels increased from 19 to 23 percent. construction. Single family builders agree
multifamily home builders, according to their standard business practices. Nearly half (43 percent) of the builders about the challenge of consumers not
new research published in the Green Increasing energy efficiency continues surveyed expect to use this technology in being willing to pay, the top obstacle for
Multifamily and Single Family Homes to be the most common method of the future. them.
2017 SmartMarket Brief. The report is improving the performance of a green Other SmartMarket findings suggest -NAHB
available for free download at home, followed by creating a healthy the single family green home market is
www.nahb.org/SMR. indoor living environment. maturing. For one, the report found that
2 Builders Outlook 2017 Issue 9
Natural gas can help. From grills and fire pits to lights and torches, building
outdoor living spaces equipped with safe, clean and efficient natural gas gives your
customers a chance to enjoy the big game from the comfort of home.
Please continue to direct service line and meter set requests to the Texas Gas
Service Builder Hotline at slimgas-metroElPaso@onegas.com or 1-866-206-9587.
2017 Issue 9 Builders Outlook 3
Presidents Don
Message
Rassette
President,
El Paso Association
of Builders
Home building just got a little tougher, but there is some good news too
Earlier this year I wrote on how of better paying and more consistent Construction Month. This recognizes another possible savings for our
easy it is to build houses, and then work. In addition, are you aware that and brings more attention to the need industry.
listed several of the speed bumps and the average age of a skilled to grow the construction workforce to I was remiss in mentioning last time,
problems to this statement which construction worker, across the meet the housing needs of Texas. that September was NAHBs
included lot shortages, restricted country, is more than 50 years old? Additionally, at our August board Associate Member Appreciation
financing, labor shortages and With this being the average age, our meeting, I mentioned how well TAB Month. Across the country, about two-
material delays to name a few. Now industry is slowly losing skilled trades did this year in the legislative session thirds of the total membership comes
with the latest natural disasters; such and workers. These trades are not and briefly touched on the $2,000.00 from associate members. Locally, our
as Harvey, Irma and Maria, plus the being filled by younger workers, which Energy Efficient New Homes Tax numbers are very similar. So, to the
recent fires in the northwest and west, only compounds to the difficulty of Credit. The U.S. Department of Associate Members of EPAB, THANK
earthquakes in Mexico, our finding skilled labor. Energy approved this Tax Credit on YOU FOR MAKING OUR
construction industrys ease of The U.S. unemployment rate is near June 26, 2017. Please do your own ASSOCIATION BIGGER AND
building problems will only increase. its lowest level in 16 years, so those due diligence and verification, but BETTER!
Our suppliers warehouses and who want a job can get a job. So be here in a nutshell are the eligibility We are in the last quarter of this
factories may be flooded or have prepared that certain trades, sub- requirements: calendar year and I would like every
caught on fire. Workers in these contractors and suppliers will have Single family and multi-family member to look at what they do for
warehouses/factories may not be able problems getting workers and homes up to 3 stories, EPAB. Thats right what do you do for
to get to work due to living, materials and there will be delays with Units must be 50% above the our association? I encourage you to
warehouse/factory and road deliveries of the materials and 2006 IECC, get involved or be more involved for
conditions. This means we will see a supplies that are needed on jobsites Raters must use DOE approved 2018. Its easy to be a cruiser, rather
longer delivery time and increase in everywhere. This will lead to longer software to generate the energy than a carrier.
cost as these suppliers work to re- cycle times and we all know the savings calculations, In closing, BE PREPARE TO
build. sayings that time is money or time Homes must be inspected and SUCCEED!
At the same time as many cities are is of the essence. certified by a certified HERS Rater,
working to re-build homes, business Some good news: through Tax credits are retroactive for up to
and infrastructure many skilled labors cooperation and lobbying by TAB, 3 years.
from around the country and from Governor Greg Abbott has declared Here again is the strength of our
here in El Paso, will move for the offer October 2017, as Careers in associations, working and adding
4
Executives Association showcases affodablity
Builders Outlook 2017 Issue 9
Message
$60,000 or even $100,000 range. at between $25 and $30. The our rescue to reseal the front door
No, those days are gone and simple rule is that a finished as it was looking worn and dry.
Ray Adauto, surprise, its going to get even house is four to six times the cost He also cleaned up some of the
Executive more expensive as goods, land, of the lot. So, its not farfetched to cracked paint on the sidewalk and
Vice President and labor costs go up. Land costs see if a lot is sold to the builder for replaced some stones that had
EPAB are going up as the cost of $50,000 then the finished house come off. Thank you, Rudy Guel
development and the all the new should run somewhere in the $250 Construction.
codes and things like lumber, to $300,000 range. A lot depends Our reception for the Mayor and
nails, paint and things needed to on what goes into the home, but council went rather well on
The Association enjoyed a very build a home. On the day I wrote its still a good guesstimate. September 20. We had Chef
good el Paseo de Casas, what we this our member builders were So affordable doesnt mean Rulis cater and 915 Bartending
dubbed an affordable showcase. selecting lots far out Montana YOU can afford it, but rather that it serve the drinks. Thanks to our
While we had success with the nearer and nearer to Hueco is affordable for the marketplace. members who came and heard
presentation and the activities Tanks. You read right, Hueco If a builder misprices the home the Mayor. Get ready to hear
associated with the Paseo some Tanks. A lot of what is happening that builder will either go broke or State Rep Joe Pickett at our
in the community couldnt believe is that there is no more cheap be out of business rather quickly. membership meeting on
that our homes were priced from land like a few years ago and that Again, the key is what the price of THURSDAY, October 12. El Paso
the mid $160s to $220s. Gasp, translates to higher costs. Let me land is going for. Club. Please mark the date
what do you mean affordable? give you a simple accounting of Id like to take time to thank change and place.
some asked. Well the answers what a house will be priced at. If some of our members for some
are relatively simple as the price the land were to cost $5 then the work done on the EPAB building.
of new homes is no longer in the completed house should be priced Rudy Guel once again came to
Hurricane Harvey:
Rebuilding with
Confidence
Builder News
Granger MacDonald
Index gauges builder perceptions of
current single-family home sales and
Builder Confidence
developer from Kerrville, Texas, today seasonally adjusted index where any
issued the following statement on the tax availability of labor and the cost of number over 50 indicates that more
As Hurricanes Add
NAHB commends President Trump developer from Kerrville, Texas. Once the All three HMI components posted
and Congress for making the vital issue of rebuilding process is underway, I expect losses in September but remain at healthy
Uncertainty
tax reform a top priority. During the past builder confidence will return to the high levels. The component gauging current
several months, we have conveyed our levels we saw this spring. sales conditions fell four points to 70 and
views and concerns to policymakers and Despite this months drop, builder the index charting sales expectations in
we firmly believe that the plan unveiled n Builder confidence in the market for confidence is still on very firm ground, the next six months dropped four points to
today represents a positive step in the newly-built single-family homes fell three said NAHB Chief Economist Robert Dietz. 74. Meanwhile, the component measuring
right direction. points to a level of 64 in September from With ongoing job creation, economic buyer traffic slipped a single point to 47.
By lowering the pass-through rate, the a downwardly revised August reading of growth and rising consumer confidence, Looking at the three-month moving
plan will reduce the tax bill of thousands 67 on the National Association of Home we should see the housing market averages for regional HMI scores, the
of small businesses and help to spur job Builders/Wells Fargo Housing Market continue to recover at a gradual, steady West increased three points to 77 and the
and economic growth. More importantly, Index (HMI). pace throughout the rest of the year. Northeast rose one point to 49. The South
the blueprint maintains the Low Income The recent hurricanes have intensified Derived from a monthly survey that dropped a single point to 66 and the
Housing Tax Credit, the most our members concerns about the NAHB has been conducting for 30 years, Midwest fell three points to 63.
indispensable tool to help produce
affordable rental housing. The plan also
retains a business interest deduction for
small businesses, which would ensure
that our future tax code is truly pro-
growth.
On an issue of such significance, we
recognize difficult trade-offs must be
made. Although the mortgage interest
deduction remains untouched, its
effectiveness could be diminished as
more families elect to take a higher
standard deduction. As the process
advances, NAHB looks forward to working
with policymakers to mitigate any
detrimental effects that this development
could have on the housing market. In
addition, we will also seek to ensure that
tax relief efforts put more money into the
pockets of hard-working families and that
affordable homeownership and rental
housing opportunities remain an
accessible goal.
Special Guest:
Ahmed Hassan, Celebrity
tA rated carriers, several available
Economic
Forescast
After failing to repeal the wrath of dozens of interest groups, Reducing corporate taxes is an idea that has
broad support across the political spectrum
or replace Obamacare, as well as court the potential loss of
Elliot Eisenberg Republican seats in high tax states
perverse effects.
friend. Proposals that look great in same reason, the mortgage interest
theory are routinely derailed by details. deduction and charitable deduction are
And, that is why there has been no already off limits.
significant tax reform since 1986. Reducing corporate taxes is an idea
Moreover, passing tax reform has that has broad support across the
historically required a bipartisan political spectrum since many US- being a small tax cut. While a large tax oppose tax breaks for renewable
coalition to withstand the many headquartered firms have already cut might seem more appealing, with energy, but members of Congress from
opposition groups that intensively moved to Europe to escape high US an existing budget deficit that is states with substantial wind and solar
lobby to protect their deductions. corporate taxes. The problem is that already large, and on track to get energy will strongly disagree. While
Moreover, it will be inordinately difficult financing the lower tax rate requires much worse over the next decade, Republicans may agree on the broad
for Republicans to pass revenue- eliminating corporate deductions for, because of rising healthcare and outline of tax policy, such as lower
neutral tax reform on a partisan basis among other things, investment, and retirement costs, the votes for a large rates and fewer loopholes, they will
with a slim two-vote majority in the doing that would have perverse tax cut that will increase our already divide on the details as they reveal
Senate and with a president with an effects. It would raise the cost of new enormous debt are simply not there. In themselves. With a slim Republican
approval rating in the upper-thirties. investment and thus reduce economic short, the inability to increase the majority, Democrats in no mood to
Thus, expect -- a small tax cut, but no growth, the opposite of the intended deficit on one hand and the political help, and an election year fast
structural tax changes. effect. If we reduce the corporate rate inability to raise revenues by closing approaching, meaningful tax reform
Republicans generally agree that to 15% or 20%, enough to overcome loopholes on the other makes this will wait for another Congress. Despite
individuals should not be able to the investment problem, we create entire exercise very difficult. the legislative need, I peg the chances
deduct state and local income taxes enormous incentives for people to re- Tax reform is hard, demands of a meaningful tax cut at 65%/35%.
from their federal taxes. The problem characterize wage income as business unpleasant trade-offs, and even
is that if Congressional Republicans income, leading to enormous deficits. creates divisions that cut across party
attack this deduction, they will incur This leaves the most likely outcome lines. For example, some Republicans
nahb.org/MA
EPAB ON THESCENE
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CELEBRATING
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member of the El Paso Association of Builders.
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As the plan sponsor, you can determine the Allow in-service distributions Mailed monthly to thousands of local homes
different types of compensation eligible for NQDC plans are unfunded contractual
employee elective deferrals or employer obligations to pay benefits to a plan participant El Paso Airport distribution
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12 Builders Outlook 2017 Issue 9
If you have an event or meeting that you would like to share with
News & Events
EPAB members, please submit your information to:
margaret1@elpasobuilders.com
Advertise your
business Builders National,
State &
Local Bu
ilding Ind
ustry New
Outlook
2015: Iss s
to the
ue 10
2016: H
ousing
UPCOMING www.elp
asobuil
ders.co
Recover
up steam
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challeng mid
home S teady em
demand
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OCTOBER 12
upward ll keep the
trend in e
headwind
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and labor, to shortag wever, on a
along wi es and av persistent
impedin th rising ailability
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ga material of lots
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industry
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feel
The goo ard. tinue le mortgag e.
d news, expecte e interest
total U.S Crowe add d to
. employm ed, is that averaging rise over the nea rates are
well abo ent of 142 mill 4.5 perc r-term,
ve the prev ion is now percent ent in 201 Single-Fam
that occ ious pea in 2017, 6 and 5.5 ily Continu
urred in k of 138 mill exp ected to Cro we said Turning
The one 2008. ion have an this is not to the fore es to Pos
been con cav eat is that job
recovery
. As the imp act projecting cast, NAH t Gains
cen and wag econom on the housing 719,000 B is
sector, whi trated heavily growth has e growth y gets bett 2015, up
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OCTOBER 13-15
on. stands at Supply to 914,000
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le biggest Crowe note nds 354,000 tifamily side
peoples asset in d several units last , prod uction ran
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said Cro is ga at
we. Thats the home they NAHB surv more robust reco that are level of
level that htly abo
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primary
purchas importa own, ey of its very. Citin producti is considered a
sellers of ers of new nt because the builders
reported members, 13 perc g an sam expecte
d to rise
on. Multifam normal
ily starts
existing homes are labor was the ent of e concern this yea 9
homes. a significa cost and availab r and pos percent to 387,000 are
Fall Hom
nt problem decline
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About one jumped to 61 perc in 2011 and Concern t up to 58 percent 2011 and unit ent
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-fifth of buil ent
ders sha in 2014. at 58 perc s over building in 2014.
forecasted remodeling 2016.
Garden
ent amo mat
red the from 33 ng builders erials stood over last to increase 6.8
activity is
Show
percent in 2014, year and perc
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attracts
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CIVIC CENTER
really mad together
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of actually more interesting. wcase home
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6
thousan Garden the faint ing is not s on
Judson ds of peo show hearted. somethi
Will ple Habitat We wer ng for
show kick iams Convention into the for
could from Humanity to don
e asked
by
ed
people wer off October 9. Center as the could, Torr this build, and ate wha t
presente e greeted by a
The thro
ngs of Im prou we
d show very nice the showca es told the Out d that we
produce complim ly look. The
r Show ents waiting for se was quickly rest of
Antonio. Technology of the take
out of San parts that some of the fram n to a lot
could be e
The sho
w waste. used so and other
showcase featured a spe Ove
NOVEMBER 1
to not go
ctac showcase rall a very bea to
Metro Homhome by new buil ular for years home that will con l green
utifu
der mem
was mad es. The design ber to come. tinue to
e of The Fall give
site in orde to be partially con the display show of Home and
structed
established r to meet the time off its Garden
center was kind this year sinc was the only some time
that eve for the lines e the civic , said Ass
n with that show. I have to Bowling taken ove
r for the Sam Sha
llenberg ociates
Chairma
Cha
GOLF TOURNAMENT
hustled addition tell Mens
to make al time we you center turn mpionship (AB and exh er.
ibitors and We had new n bring to
product sure we C).
had a grea really complet ed into a large bow The civic have. that was disp the
CTU Met
to show,
said Fernan t e with state ling alle a nice thin lays whats hot consumer bec
run into The pres g to in the wor ause
ro
staged the Homes. Beautifu do Torres of situations of the art lanes. y enting attra said. ld of wal I know
l and eleg center or like this We Wiz ard, Bria ction was ls, Santos
the show house became antly that can
halls we when the
civic demons n Santos the Wall Our sinc
winning the favo use are trati who did and all the ere thanks to CTU
efforts. Best of rite of fit the ons duri several
We Show for of Show our shows, said only ones I really
love com ng the three day
off our mod are excited to Technology Acosta Reasuppliers and the Metro Homes
7
readers online, the Builders Outlook is an important
7
advertising medium for any business that want to reach
Builders: this valuable market.
www.elpasobuilders.com
Call 778-5387 today for
EL PASO
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14 Builders Outlook 2017 Issue 9
EPAB
on the Scene EPAB among key agencies to meet students
The El Paso Association of Builders was said Bob Ayoub. I couldnt see us not
invited to participate in an unusual event at being here because we need workers,
the El Paso Civic Center designed to skilled and unskilled labor and
introduce high school students to job and professionals to take the reins of the
careers available in El Paso. Bob Ayoub industry, Ayoub continued. Anita
of MIMCO lead the group that included Dominguez is a senior commercial escrow
WestStar Home Loans, SLI Engineering officer at WestStar Home Loans. I am so
and the EPAB. I took place on September enthusiastic with the prospects and
28. interest the kids showed, she said. I think
Students were bussed in from the El this was a really good event for them as
Paso Independent School District put well as us. Georges Halloul, P.E. of SLI
together by Workforce Solutions. In the Engineering was asked dozens of
event students could visit booths set up by questions by students wanting to know
numerous government agencies like the about what it takes to be and engineer. I
Border Patrol, FBI, El Paso Fire told the kids that math is the key, and
Department and others. Also represented getting a good start in college goes a long
were private sector employers like TFCU way, but I also told them that engineering
Credit Union, GECU, Providence Hospital, requires business sense to be successful,
Texas Tech, UMC, Texas Gas, El Paso Halloul told the Outlook.
Electric, and others. Also, UTEP was well Plans call for the event to get bigger
represented with several booths from with more school districts involved. This
different departments. Amazon was also could be a great recruiting tool for us and
displaying raising some interest as they we hope to participate again, Ayoub
look to fill the thousands of jobs being concluded.
created across the country.
Joyce Wilson, former City Manager was
ecstatic about the event. First of all, I am
thrilled that the El Paso Association of
Builders is here with us, she told a group
gathered in front of the booth. This show
is something that all employers in El Paso
would benefit doing and this booth with
MIMCO, SLI Engineering, WestStar Home
Loans and the builders is giving our kids a
look at good jobs with real possibilities,
she went on to say.
I want to make sure that our real estate
industry is represented and I am so happy
to have had the Association join us in
bringing that message to our students
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