In this issue
- Knoxville HBA puts focus on future housing needs
- The confusion of Lumber stories versus reality
- Computer savings & sales tax holidays
- NAHB Contracts on demand
- Interesting news items
- New climate priorities demand renovations and retrofits
- Get paid back, HBA Member rebate reminders
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Construction Challenges:
Knoxville needs 40,000 more homes in the next 30 years. Can builders meet the demand?
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John Cook, president and chief executive officer of Cook Bros. Homes, is photographed at the site of a home currently under construction in The Grove at Cedar Hills subdivision in Lenoir City.
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(Knoxville News Sentinel) – Knoxville’s housing shortage isn’t going away. One solution seems obvious: Build more homes.
But home builders face major challenges right now, including high material costs, supply delays, a labor shortage and a lack of available property. And the squeeze is just going to get tighter: Knoxville needs approximately 40,000 more housing units by 2050 for the area’s growing population, according to Amy Brooks, executive director of Knoxville-Knox County Planning.
John Cook, president and CEO of Cook Bros. Homes and current president of the Home Builders Association of Greater Knoxville, said Brooks’ estimate sounds low compared to the demand he’s experiencing on the job. “In the home-building world, 2021 is basically the best of times and the worst of times,” Cook told Knox News.
A study by the National Association of Realtors estimates the U.S. needs an additional 6.8 million housing units to meet demand. Homebuilders say it will take everyone working together to solve Knoxville’s supply issue and still save its reputation as an affordable place to live.
If Knoxville’s housing supply isn’t replenished, the area’s affordability and economic growth are at stake. “If there’s not enough housing, then what’s going to happen is… price will just continue to increase until it gets out of hand and people are priced out,” Cook said. “I don’t think that’s good for the community as a whole, and it certainly isn’t good for businesses locating here.”
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The media has excitedly reported on the recent drop in the commodity price of framing lumber. Builders know this has not actually translated a similar reduced price from suppliers. Suppliers are not yet seeing a price break either. Moreover, despite the June decreases, framing lumber remains much higher than two years ago.
Predictions of decreased demand as Americans started to go on vacations again instead of taking on renovation and building projects.
The disconnect — which has always existed — is inherent to the lumber supply chain.
The price of OSB has increased 510% since January 2020, exceeding the peak price increase in lumber by nearly 180 percentage points. Although plywood panel prices have substantially increased over the past 18 months as well, the increases have been less than half those seen in the OSB market.
HMI Survey: 82 % builders cite a lack of workers and subcontractors with the necessary experience as a significant barrier to switching away from wood framing.
Affordable housing builders are being forced to scale back projects amid escalating construction costs.
One out of four would-be home buyers couldn’t afford new construction in 2020. The affordability gap will probably be worse next year.
Notifies 164 buyers the cost of their homes likely will increase beyond the original agreed-upon price in their contracts, and that construction could be delayed up to a year.
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Are the right people in your company getting these messages?
TN Homebuilders would be excited to add more of your team members to our weekly distribution. If you want to add a co-worker, reply to this link CSchneider@hbat.org – be sure in include your teammate’s Full Name and Email address.
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Computers and technology are an important part of every businesses process these days and they don’t last forever. When you are in the market for a new unit or accessory consider using NAHB Member Savings.
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Take advantage of HBA member discounts on select Dell PCs, electronics and accessories. Choose the Dell line of business that suits your technology needs.
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Date for 2021 Sales Tax Holidays
Speaking savings, Tennessee is offering three different tax free holidays this year.
July 30th – August 1st: Back to School: clothing, school supplies and computers
July 30th – August 5th: Groceries: food, food ingredients and prepared food
Now – June, 30 2022: Firearm Safety: gun safes and safety devices
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NAHB Contracts on-demand
Protect yourself from unpredictable prices and material shortages.
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NAHB Contracts offers a variety of residential construction contracts, exclusively for home builders and remodelers. You will save hours of work — which means saving hundreds of dollars — with every contract.
Each contract product is delivered as a downloadable Word document. Choose the product and pricing option(s) that best meet your needs. View options.
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U.S. job openings hit record 9.2 million, but businesses can’t find enough workers to fill them
(MarketWatch) – Businesses are trying to fill the mountain of available jobs, but it’s not going as fast as they would like. Although the U.S. created 850,000 new jobs in June, it would take more than a year at that rate to restore employment to pre-pandemic trends.
The competition for workers has given jobseekers the upper hand. A record 4 million people quit two months ago — most to take a better or better-paying job. That’s nearly double the number of people quitting a year earlier.
“People are moving from one job to the next,” said Anthony Nieves, chairman of a monthly survey of service-oriented companies that asks how business is going.
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Justice Department Withdraws from Settlement with the National Association of Realtors
On July 1st the U.S. Justice Department’s Antitrust Division withdrew from a proposed settlement with the National Association of Realtors (NAR). The DOJ stated it determined the settlement would not adequately protect the department’s rights to investigate other conduct by NAR that could impact competition in the real estate market and may harm home sellers and home buyers. The DOJ is taking this action to permit a broader investigation of NAR’s rules and conduct to proceed without restriction.
The National Association of Realtors is calling this an “unprecedented move”. NAR’s Deputy General Counsel Lesley Muchow provides a one-minute update on the Realtor perspective.
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Can Knoxville Utility Board build and provide broadband equitably and affordably?
(Knoxville News Sentinel) – Thousands of households in East Tennessee will have access to the internet for the first time when the Knoxville Utilities Board establishes its public broadband internet program.
But will those households be able to afford it?
KUB has not announced its master plan for the physical rollout of broadband, which will take an estimated seven years to reach all 210,000 households in its area. KUB serves households in mostly Knox. Union, Grainger and Sevier counties.
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European Parliament to Pass Updated Climate Priorities
10 key policies in Brussels’ plan to slash emissions
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In the last 20 years environmental priorities started in Europe have often crossed the Atlantic creating a flash point in America politics.
Europe gets a renovation
What’s the plan? Buildings use around 40 percent of the EU’s energy: the new package requires nearly half of that energy is renewable by 2030. EU countries will also need to increase the share of renewable energy used in heating or cooling buildings by 1.1 percent each year. Plus, the Commission wants countries to renovate public buildings at all levels at a rate of 3 percent each year. And a new standalone Emissions Trading System for buildings ramps up pressure on governments to speed up the pace of energy-efficient renovations — or risk dealing with social discontent from people burdened with ever-growing power bills.
What will that mean? The legislation reinforces the Renovation Wave Strategy, which Brussels says is both good for the environment and also a great job creator. This was identified early on in the pandemic as a key stimulus measure to get countries on board.
Initial reactions: Industry voices called the measures a “big step forward” in tackling building emissions. But echoed the concerns of countries that admit they don’t have the cash to underwrite the needed renovations. The package’s success “hinges on the financial and advisory support the EU is able to provide to households and businesses,” she said.
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Get Paid Back with Rebates Available to HBA Members
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Home Builders preach the benefits of doing business with a member. We want you to do business with like-minded people who support our industry. We also encourage you to take advantage of savings by participating in Rebate Programs.
Builders and Remodelers, if you’re not participating in this rebate program, you’re leaving money on the table. Register and claim your rebates www.HBATrebates.com
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One of the great benefits of your HBA membership is access to multiple savings programs on products you already purchase. We encourage all members to use these programs. New participants are often surprised they save 2x-4x the amount of their annual dues.
Need new work trucks? Click on the image below for more information.
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NAHB has Additional Savings Programs for Business Savvy Members
Whether it’s a discount on a product or service or a more efficient way to operate, the smart business person is always looking at ways to cut costs and maximize returns.
Through agreements with more than 20 national companies, NAHB offers exclusive discounts on a variety of products and services that can benefit your business, employees and family.
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