Adonel Concrete was named the Top Business of the Year (50+ employees) by the Greater Miami Chamber of Commerce during its recently held Top Entrepreneurial Awards ceremony. The Top Entrepreneurial Awards program celebrates South Florida’s entrepreneurial spirit and rich cultural diversity. “It’s a great honor for Adonel Concrete to be recognized by the Greater Miami Chamber of Commerce,” said Luis Garcia, president. “The Chamber continues to be a catalyst for improving the economic vitality of South Florida. Its impact on enhancing economic opportunities and the quality of life in our community is immeasurable.”
At their March 12 Quarterly Luncheon, the BASF Trustees will hear from two Members of Congress from the South Florida delegation regarding the possible FAA height limitations on downtown high-rise buildings. Congresswoman Frederica Wilson (D-24) and Congressman Carlos Curbelo (R-26) will be two of the four panelists to discuss this important development issue before the Trustees, a select group of builders and developers from Miami to Fort Lauderdale. For reservations, contact firstname.lastname@example.org or call BASF offices.
Here’s latest housing news from Capitol Hill…..FYI, TB
By a wide bipartisan 378-46 margin, the House last night approved H.R. 5771, the Tax Increase Prevention Act, which will renew scores of temporary tax provisions known as “tax extenders” that expired this year, including several of interest to the housing community. The one-year retroactive renewal is through 2014 and dates back to Jan. 1.
NAHB is disappointed that a longer term deal was not reached, but the political situation and the calendar have forced Congress into a one-year deal everyone hoped to avoid.
Just one week ago, Congress was headed to a bipartisan, bicameral deal which would have extended all of the expired provisions for two years through 2015. The agreement also would have also made a handful of extenders, such as the research and development tax credit, permanent.
Just hours after word of the agreement leaked out, the White House scuttled the deal by announcing the President would veto any bill that contained these permanent provisions.
In a letter to the House prior to the bill’s passage, NAHB urged lawmakers to support the legislation. We also expressed concern that these short-term tax bills create difficulties for our members by denying builders the certainty needed to finance complex projects and called on Congress to act quickly on a longer-term deal in early 2015
Key provisions in the tax extenders package for 2014 (retroactive to Jan. 1) include:
- Section 45L Tax Credit for Energy Efficient New Homes. Provides builders a $2,000 tax credit for exceeding energy standards by 50%. The base energy code is the 2006 International Energy Conservation Code plus supplements. Section 45L is expected to save home builders $267 million in taxes for 2014 construction activity.
- Fixed Credit Rate for 9% Low Income Housing Tax Credit projects. The bill will renew the 9% fixed rate, but only for 2014 allocations.
- Section 25C Tax Credit for Qualified Energy Efficiency Improvements. This is a credit worth up to $500 (subject to a $500 lifetime cap), with lower caps for certain products like windows, for consumers to install qualified energy efficient upgrades. Remodelers often leverage 25C tax credits when working with clients. Section 25C is expected to save home owners who remodel $832 million in taxes for 2014 improvements.
- Section 179D Energy Efficient Commercial Buildings Deduction. Provides a deduction up to $1.80 per square foot for commercial buildings, including multifamily buildings built under the commercial code, that exceed specific energy efficiency minimums.
- Section 163 Deduction for Private Mortgage Insurance. Allows taxpayers, subject to an income cap, to deduct premiums paid for private mortgage insurance. The deduction for PMI is expected to save home owners $919 million for tax year 2014.
- Bonus Depreciation. Extends the 50% bonus depreciation.
- Section 179 Expensing. Increases the maximum expensing amount to $500,000 for qualified property on up to $2 million in property placed in service.
- Short-sale mortgage debt forgiveness. The provision would extend through 2014 the exclusion from gross income of a discharge of qualified principal residence indebtedness due to a short sale.
The Senate is expected to take up and pass H.R. 5771 next week.
Miami-Dade and Broward County Endorsed Candidates List
from the political action committee of the Builders Association of South Florida Chapter, BASF
Primary Election Day: Tuesday, August 26, 2014
Miami-Dade County Commission
County Commission District 2: Commissioner Jean Monestime
County Commission District 8 : Commissioner Lynda Bell
County Commission District 10: Senator Javier Souto
County Commission District 12: Commissioner Jose “Pepe” Diaz
Florida House of Representatives
District 100 – Mr. Joseph Geller (D) (Miami Beach, Aventura, Hollywood)
District 111 – Mr. Bryan Avila (R) (Hialeah, Miami Springs)
Perla Lichi, ASID is a renowned interior designer who has designed hundreds of luxury homes and palaces around the world. A specialist in art history, color, and space planning, she creates sumptuous, richly detailed interiors that many refer to as having “The Perla Lichi Look.” Clients include doctors, lawyers, entrepreneurs and business people, well-known figures in the world of sports and entertainment, and royalty.
She is a champion of encouraging people to hire a professional interior designer and has given presentations in the USA and international venues. She was recently named spokesperson for high-end decorative hardware producer Bronces Mestre of Valencia, Spain. She is the exclusive UAE distributor of Enkeboll Fine Architectural woodcarvings, made in Carson, CA.
She has published four popular coffee table books, most recently, Palaces. Three previous books were published in a series entitled “Beautiful Rooms.” Her work has been widely celebrated in magazines, newspapers, television, radio and personal appearances around the world. Her book, Palaces was recently featured in The New York Times and two prestigious Middle East publications—Arabesque and Lamasat—feature her work in almost every issue! Today she continues to expand the Perla Lichi brand through her design work and the development of proprietary lines including fabrics, custom throws, furniture, and more.
Some Professional Memberships and Affiliations
Florida State licensed interior designer, FL License No.1727, American Society of Interior Designers (ASID), National Association of Home Builders (NAHB), Florida Atlantic Building Association (BASF), American Hotel & Lodging Association, Allied Member US Green Building Council Member, Professional Consultant Interior Design for LEEDS Projects
The improvement in housing markets over the last year has been a welcome, if long awaited, change for the economy as a whole. Improvements in home prices and building are widespread, with the NAHB/First American Improving Markets Index now standing at a count of 274 of 361 MSAs. With 76% of markets now making the list, there is no doubt the housing economy is on more solid footing than a year ago.
However, the pace of that improvement appeared to slow in February. Recent data suggest that continued tight credit access for buyers has the market more dependent on cash and investor buyers than in years past. And on the supply side, growth is challenging the ability of the housing pipeline – workers, lots and building materials – to meet rising demand. Given that housing has been a bright spot amidst an otherwise stagnant economy, this slowing of improvement could have important macroeconomic impacts.
The NAHB/Wells Fargo Housing Market Index, which tracks home builder confidence, fell to a level of 44 in March, down from 47 in December. For the most recent report, the decline was due to a decrease for the gauge of current sales, most likely connected to concerns about home buyer access to credit.
Consistent with the NAHB survey, the Census Bureau reported new home sales in February were down 4.6% from the preceding month. While the month-over-month drop was notable, it remains the case that the pace of new home sales remains significantly higher (12.3%) than this time a year ago. The February sales pace of 411,000 is in line with expectations for the year. NAHB expects new home sales to average 449,000 for 2013 as more consumers regain the confidence to purchase a home. At that rate, the home building industry remains at less than two-thirds of what would be considered a normal market.
The inventory of newly built home inventory remains historically low. The current months’- supply measure of new homes stands at 4.4. Prices of newly built homes are expected to increase in the coming year for multiple reasons. One is low supply, but rising building costs for lots, materials and labor will also boost new home sales prices. Similarly, pending sales of existing homes fell 0.4% in February, as reported by the National Association of Realtors (NAR). Existing home sales also showed relative weakness, remaining virtually flat with a 0.8% monthly increase. Nonetheless, existing sales remain strongly higher (8.7%) compared to a year ago.
However, recent price growth may be helping to add inventory to the existing home market. The Case-Shiller 20-city index measure of house prices was up 8.1% year over year for the January report. Likewise, the Federal Housing Finance Agency reported national home prices were up 6.5% from January 2012 to January 2013.
As a result, existing home inventory is on the rise. The total housing inventory at the end of February increased 9.6% from the previous month to 1.94 million existing homes for sale. Part of this rise was seasonal, but rising prices are also inducing more home owners to place their homes on the market. While inventory is rising, demand is rising faster. At the current sales rate, the February 2013 inventory represents a 4.7-month supply compared to a 6.4-month supply of homes a year ago.
Yet concerns remain about the mix of home buyers. NAR estimates that in February, all-cash transactions rose to 32% of all existing home sales. Investor buyers constituted 22% of sales. The number of first-time buyers remain historically low, at 30% of buyers in February, down from 32% from a year ago.
Other notes of caution come from the builder side of the supply equation. Due to the historic nature of the downturn in residential construction, it is not surprising that the infrastructure of building – buildable lots, workers with the right skills and a pipeline of building materials – will at times and in certain locations be insufficient to meet the demands of rising home construction.
NAHB survey data confirm that shortages of many types of labor are having an adverse effect for builders in some parts of the country. Between June 2012 and March 2013, the share of builders reporting at least some shortage increased in every category of labor. Averaged across all 12 categories, 27.8% reported a shortage of directly employed workers in 2013, up from 19.6% in 2012.
More than half of builders reported that labor shortages over the past six months have caused them to pay higher wages or subcontractor bids, and to raise home prices. Other effects include delays in completing projects on time, being forced to turn down some projects and lost or cancelled sales.
Additionally, building materials prices continue to rise. While overall producer prices have been relatively stable, the prices for certain building materials have risen rapidly as the housing recovery has gained momentum since the beginning of 2012. Overall producer prices are up less than 3% while softwood lumber, OSB and gypsum prices are 30%, 80% and 26% higher than at the start of 2012. According to data associated with the Consumer Price Index, gasoline prices were up 3.3% in February year over year.
Yet the long-term prospects of home building demand remain positive, with builders ramping up production despite the occasional monthly dips. Housing starts for February came in at a healthy pace for both single- and multifamily units according to Census data. Single-family housing starts in February ran at a 618,000 annual pace while multifamily starts came in at 299,000. This represents a continuation of the solid growth trajectory in single-family starts that began in earnest in late 2011 and carried through 2012. Issuance of new building permits is on track to sustain the current levels of production and NAHB expects that going forward, the pace of single-family production will accelerate, approaching 1 million starts by the end of 2014.
Looking at a particular submarket, Census data from the end of 2012 suggests that the market share of townhouses (single-family attached) continues to rise back after the Great Recession, with the current market share standing at around 12%.
In policy analysis news, NAHB recently examined state-level IRS data that maps the share of taxpayers who benefit from the mortgage interest deduction (MID) who earn less than $200,000 in adjusted gross income. Nationally, the data indicate that 91% of taxpayers who claim the MID make less than $200,000. Not surprisingly, the share tends to drop somewhat in high-cost states, such as New York and California, for which household incomes tend to be higher.
The Federal Reserve also recently affirmed its accommodating monetary policy stance, noting that it will keeping the federal funds target rate at the 0-25 basis point range, and asset purchases (QE3) totaling $85 billion per month ($40 billion in MBS and $45 billion in Treasury securities).
Finally, NAHB recently published its home buyer preference survey: What Home Buyers Really Want. Among the finding are data on desired home size. Among all home buyers, the median home size desired is 2,226 square feet. Age plays an important role, with the amount of space desired dropping steadily as the age of the buyer increases. Among those younger than 35, the size desired is 2,494 square feet, compared to 2,065 square feet among those 65 or older.
Some key legislative bills coming up for consideration include:
- Homeowner Association legislation (SB 580/HB7119)
- Impact fee bill (HB 1716/SB321)
- Workers Compensation tweaks (multiple bills moving now)
- Look for results of our annual Tallahassee lobbying, on April 16-17, 2013, in next edition of BASF’s Hard Hat News!
Roadway Impact fees – Miami-Dade Legislative Members have stopped impact fee increases at the County Commission for the past four years. However, given the slowly improving economic conditions, roadway impact fees are going up on April 19, 2013. PLEASE PAY YOUR IMPACT FEES PRIOR TO THIS DATE, TO AVOID A SIGINIFICANT STEP INCREASE.
School Concurrency Deficits Cropping Up – As builders make application for concurrency, high school classroom capacity in the eastern parts of the County are at a deficit. Miami-Dade Legislative members will be meeting with School Board staff to discuss the unnecessary complicated approach they have taken to establishing mitigation credits for certain builders.
This includes convoluted service area restrictions, requirements to obtain letters of credit (very difficult) for all builders, regardless of project or business size and requiring full payment of all fees within 30 days of a signed developer agreement. EAR-Based Master Plan Amendments go to first round of hearings – several key policy matters will be included in the Miami-Dade Planning Division’s Evaluation and Review (EAR) based Plan amendments. The Planning Advisory Board will hear these items at transmittal public hearing in late April. BASF’s Miami-Dade Legislative Staff is monitoring this process closely and in particular, the following issues:
- Population Projections – underreported projections is artificially reducing the amount of residential capacity to be brought into the master Plan.
- Climate change – County staff is “preparing to prepare” CDMP criteria to evaluate applications for sea level rise.
- Adding industrial land to fill in “Hole in the Donut” – Doral area to see inclusion of 250 acres of developable land (another 250 is in lakes).
Palm Beach County
Impact Fee Ordinance adopted at March public hearing – residential fees see no increase – Palm Beach County Impact fee ordinance – new fee schedule was adopted in mid-March public hearing for a mid-May implementation date. Given strong negotiations with BASF and other involved associations, residential fees will NOT increase this year; however, commercial fees will go up some. I can provide some analysis on the fee schedule for those who are interested. Write back in e-mail and I can provide same.
Miami-Dade Commercial Vehicle ID Ordinance Creating Value for Our Members Every Day
We recently learned from AGC that Miami Dade Police are enforcing the “Commercial Vehicle Identification” Ordinance (Sec 8A-276) resulting in at least one fine of $210.00. This ordinance defines “commercial vehicle” as “any vehicle whether horse-drawn, motor drive or towed, and used,constructed, or equipped for the transportation of goods, merchandise, tools, or equipment in trade, commerce, or industry.” It requires that all such vehicles must “at all times display, permanently affixed and plainly marked on both sides in letters and numerals not less than three (3)inches in height.”
The name, address and telephone number of the owner thereof The numbers of all occupational and business licenses issued to the owner thereof. If the vehicle is rented, all the requirements apply to the lessee or user and not the owner, may be paperboard, and attached by means of tape, at the time such vehicle is delivered to the user or lessee.
If your vehicles do not comply and you operate in Miami- Dade County, this is a “Head’s Up” to correct. For example, the vehicle ticketed and fined did not have the address of the owner, though all other information was properly displayed.
May 6, 2013 – The number of U.S. housing markets showing sustained improvement in three key measures fell slightly to 258 in May from 273 in April, according to the NAHB/First American Improving Markets Index (IMI), released today. This total includes entrants from all 50 states and the District of Columbia.
The IMI identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months. Four new markets were added to the list and 19 were dropped from it this month. Newcomers included the geographically diverse metros of Dothan, Ala.; Elizabethtown, Ky.; Salisbury, Md.; and Salem, Ore. “The fact that over 70 percent of all U.S. metros are holding onto their spots on the improving list is definitely good news, and representative of the generally brightening outlook for housing markets nationwide,” said NAHB Chairman Rick Judson, a home builder from Charlotte, N.C. “That said, our industry’s progress on the road to recovery is being slowed by rising challenges related to the availability of credit, building materials, labor and lots for development.”
“While seasonal trends in home prices resulted in an overall decline in the IMI this month, the index remains at a very strong level and continues to represent markets in every state,” noted NAHB Chief Economist David Crowe. “Some metropolitan areas that had previously charted marginal home-price gains dropped off the list this time as a result of typically softer prices seen in the winter months, which is similar to what the index showed in this same period last year.”
“Today’s report shows that the majority of U.S. metros are experiencing strengthening house prices, employment and permitting activity, which is a much more positive picture than the one we were seeing a year ago,” observed Kurt Pfotenhauer, vice chairman of First American Title Insurance Company. “That’s the big picture on which consumers need to focus.”
The IMI is designed to track housing markets throughout the country that are showing signs of improving economic health. The index measures three sets of independent monthly data to get a mark on the top Metropolitan Statistical Areas. The three indicators that are analyzed are employment growth from the Bureau of Labor Statistics, house price appreciation from Freddie Mac and single-family housing permit growth from the U.S. Census Bureau. NAHB uses the latest available data from these sources to generate a list of improving markets. A metro area must see improvement in all three measures for at least six consecutive months following those measures’ respective troughs before being included on the improving markets list.
A complete list of all 258 metropolitan areas currently on the IMI, and separate breakouts of metros newly added to or dropped from the list in May, is available at www.nahb.org/imi
When members of the Florida Home Builders Association calculate the return on their annual dues investment, the results of the 2013 Florida Legislative Session in Tallahassee should go a long way to proving FHBA’s worth. The state association achieved almost its entire legislative agenda, including promoting the passage of bills that: • Increase fines, penalties, and enforcement actions against unlicensed contractors and allocate $250,000 to the Department of Business and Professional Regulation (DBPR) to conduct stings and sweeps in search of unlicensed activity.
- Change the state’s drug re-packaging law in a way that should save businesses about 1 percent on their workers compensation rates.
- Save remodelers the time and expense related to receiving Department of Health (DOH) approval when a small remodeling job does not require expansion of a septic tank system./li>
- Speed up the mortgage foreclosure process, leading to a reduced inventory of distressed properties and a more favorable environment for new home sales.
- Preempt local “sick leave” ordinances and relieves employers of the burden of providing sick leave to non-fulltime employees.
- Better define the calculations for determining transportation concurrency, mobility fees, and proportionate share aspects of growth management regulations, allowing developers to more effectively “pay as they go.”
- Prohibit local governments from passing “Baby Hometown” laws that would require voter referenda on comp plan and land use changes.
- Set aside $40 million in down payment assistance from funds from a national mortgage fraud settlement (although the funds are limited to existing homes).
- Create new rules governing home owners associations.
- Fund statewide building code education ($925,000) and the training for the next generation of construction professionals ($250,000 for the Future Builders of America program) barring any line-item vetoes by Governor Rick Scott. According to FHBA Governmental Affairs Committee Chair Zac Extejt of Port Charlotte and chief lobbyist Doug Buck, the session’s biggest disappointment was the Legislature’s annual sweep of Sadowski Act funds earmarked for affordable housing,