Tax Bill Keeps Energy Credits in 2011
EcoHome
“Homeowners looking to make upgrades on Uncle Sam’s penny have another year to do so, thanks to an extension of the home energy-efficiency improvement tax credits.”

Housing market perks up as economy strengthens
Washington Post
“The housing market is showing surprising signs of improvement in recent months, as the broader economy strengthens slightly heading into 2011.”

NAHB study: Small builders rule the housing market
Professional Builder
“Small home builders are the mainstay of the nation’s housing industry, including a sizable number of self-employed mom-and-pop operations, according to a new study by economists at the National Association of Home Builders.”

When things slow in January, builders should cast their gaze to clean technology, which benefits from a tax credit that won’t expire until Dec. 31, 2016.

Just like the expiring tax credit, which offers a 30 percent tax credit on qualifying windows, doors, HVAC systems, insulation, water heaters and roofing, the clean tech tax credit offers a 30 percent tax credit on solar energy systems, geothermal heat pumps and residential wind turbines. Here’s the major difference: The clean tech tax credit has no upper limit, inviting consumers to spend away.

Builders can leverage the clean tech tax credit for new business by learning the extensive incentives involved. Homeowners with solar panels, for instance, can receive federal, state and city incentives, which can help offset the considerable initial expenses. Trust — the incentives add up.

The U.S. Department of Energy’s Database of State Incentives for Renewables & Efficiency (DSIRE) is a great resource for builders working with consumers who are committed to owning a smart, energy efficient home. The clean tech incentives are boundless, but DSIRE is nothing if not easily navigable.

The first piece explores whether the tax credit might have been a mistake:

Clearly, temporary tax credits succeeded in getting buyers to change their behavior. But once the tax credits disappeared, so did the buyers. “Why would you have signed a contract in May and not in April when you could have gotten an $8,000 tax credit?” says John Burns, a housing consultant based in Irvine, Calif.

What’s less clear is whether stimulus has done anything else to change demand. While mortgage rates continue to fall every week into record territory, the expiration of tax credits shows that housing demand is not much better than it was 18 months ago, when the market was in freefall.

Some analysts say that even if the tax credit has simply shifted demand around, the tax credit did help to stabilize the market when the patient—the banking system, the economy, home-buyer psychology—was in the greatest need of help.

A second article examines the outlook for home builders:

This morning, the Commerce Department reported that new home sales hit their lowest-ever level in July, with just 276,000 homes expected to move in 2010, based on last month’s numbers. … So what do these record lows mean for builders? …

[M]ost analysts Wednesday were very cautious about the future, and some downright dismal about the prospect of seeing any good earnings reports next quarter. Buck Horne, an analyst with Raymond James & Associates Inc., said Toll’s balance sheet is weighed down with land assets, which will hurt their margins in the coming months. Analysts from Keefe, Bruyette & Woods Inc. predicted “a sharp slowdown in home sales over the coming months” and Ticonderoga Securities found “little to get excited about” in the new-home sales numbers.

A few analysts struck a positive note on the sector as a whole, including J.P. Morgan’s Michael Rehault, who predicted a return to profitability for the building sector by year-end.

What are you seeing in the marketplace? What’s your outlook for the coming months, years? Did the tax credit affect your business — positively or negatively? Let us know in the comments.

[chart via WSJ]

Green Homes Sell Faster, But Harder to Appraise
HGTV Pro – NAHB (Nation’s Building News)
“While official statistics may be lacking, many builders attending the NAHB National Green Building Conference in Raleigh, N.C., on May 16-18 said that they have been able to sell sustainably built homes considerably faster than the traditionally built new homes that have been languishing in today’s tough market.

Green builders, however, have little immunity from the tight financial conditions that have been plaguing the housing market and imposing difficulties for both home buyers and sellers. And the widespread problem of low appraisals — driven largely by a glut of foreclosed properties and a slow market — has been doubly frustrating for green builders because the vast majority of appraisers are unable to recognize the value that green features add to the home.”

New Lead Paint Laws Updated
Charles & Hudson
“The new lead paint rule instituted by the EPA that requires special handling when remodeling all pre-1978 homes has now been slightly altered.”

Home-Efficiency Program Takes Hit
WSJ – Developments Blog
“White House-backed effort to encourage home-energy improvements was dealt a blow Tuesday after a federal regulator said the program posed significant risks to mortgage lenders and investors. The Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, suggested the mortgage finance titans should avoid participating in the program or should tighten their lending standards where the initiative moves forward.”

U.S. Average House Size Shrinks in 2009
Big Builder Online
“The average size of a new single-family house shrank significantly from 2008 to 2009, the census figures show. Nationally the average decrease was 51 square feet, to 2,422 square feet.” The Wall Street Journal Developments Blog also comments on this trend here.

Job Growth is Key for Housing Recovery
Residential Architect
“According to the JCHS report, the housing recovery will hinge on employment recovery. Historically, high employment rates have driven both existing-home purchases and new-home purchases. Unemployment is at an all-time high, and as of April 2010, 6.7 million workers had been out of work for six months or longer.”

Demand for Windows Forecasted to Rise
Pro Sales Online
“Demand for windows in the United States will reverse a four-year slide in 2010, climbing 10.5% to 43 million units and then continuing to rise steadily through 2013, a research group working for two major trade associations has forecast.”

A last-minute report from the Associated Press paints a picture of eager and hurried homebuyers and frantic real estate agents in a mad dash to get deals done, saying, “The tax incentives — offered to both first-time buyers and some current homeowners — are fueling a strong spring selling season and helping home prices stabilize.” Later, the report says:

After the tax credit is gone, though, the surge could be short-lived. Many analysts project sales will drop sharply in the second half of the year. Some expect prices to plunge as well, especially if mortgage rates rise and a wave of foreclosed homes hits the market. …

Still, the housing market seems finally to be regaining its footing after the worst downturn since the Depression.

Builder magazine, however, throws some cold water on the hype: “Despite the last-minute push, though, it appears as though — for better or for worse — this tax credit extension has only brought a limited sales boost to builders this year.”

What are you seeing the marketplace? Has the tax credit had an impact on your business? What are your plans for the post-tax credit era?

[photo]

The Housing Market After April 30: Going Up or Going Down?
Old House Web
“The big question is what happens after April 30? The spring buying season is traditionally good for selling new and existing homes, and then it drops off slightly as families go on vacation and are busy with summertime activities. The tax credit will have expired, and the federal programs holding down interest rates are also running out. Mortgage rates are headed upward: USA Today reports that home buyers are rushing to purchase before rates rise too much, and they can no longer afford to buy.”

Small Entity Compliance Guide to Renovate Right EPA’s Lead-Based Paint Renovation, Repair, and Painting Program
Home Construction & Improvement
“The EPA’s new Lead Paint Law takes effect on April 22, 2010 and there seems to be more questions than answers especially from small business owners. Many of the smaller contractors have questions about Contractor Lead Paint Certification, waivers, personnel training and costs associated with this new law. The EPA has created a publication to help educate small businesses about the new Lead Paint Law.”

Smart Meters Hit Bumps in the Road
Inhabitat
“Last week in Texas, a state senator responding to consumer complaints about skyrocketing bills asked the Public Utility Commission to halt Oncor’s installation of the devices. This week, the California PUC announced that it would investigate similar complaints about meters installed by Pacific Gas & Electric Co.. (Both utilities insist the bills stemmed from heavier usage, not the meters.) Then San Francisco-based online privacy watchdog the Electronic Frontier Foundation seized the opportunity to send the PUC a laundry list of related privacy concerns.”

Home Design Find recently profiled the Cold Spring Green Condos in Massachusetts. What makes these condos green? Let’s count the ways:

• Geothermal energy! Instead of using electricity to heat and cool, Cold Spring Green uses a geothermal system from wells in front of each building. This leads to a 70 percent cost savings on heating and cooling. Best of all, there won’t be any difference between this and a more traditional system: the condos will remain at comfortable temperatures year-round.
• The roofs are ready for solar panels! This will further help reduce energy costs.
• The kitchens have energy-efficient appliances.
• Open floor plans help air to circulate.

As Home Design Find points out, there are many tax rebates and credits for green building, both federally and in Massachusetts. As a matter of fact, they estimate that with solar panels, owners could save nearly $100,000 over 20 years.

How much do you think you could save your customers by building green?

Photos courtesy of Home Design Find.

California’s Tax Credit: Will Home Buyers Stampede for $18,000?
WSJ Developments blog
“Tuesday, we told you that the (financially troubled) state of California is poised to offer home buyers up to $10,000 to get off the fence and to the dotted line. The $200 million program, split between first-time buyers of existing homes and new units, should keep the Golden State’s sales moving along post spring-selling season. But, it might not get off to a peaceful start on May 1: Get ready for a stampede early on as some buyers rush to overlap with the federal tax credit that’s dangling as much as $8,000 to buyers. (Yes, that’s up to $18,000 for buying a house.)”

HOMESTAR 101
Center for American Progress
“The HOME STAR program is a new initiative to create jobs in the construction industry and make it easy for every American homeowner to quickly and immediately cut their rising monthly energy bills by improving the energy efficiency of their homes. HOME STAR will empower homeowners to seize control of skyrocketing energy costs, create good living-wage jobs, and drive economic recovery in the United States. The program is designed to jumpstart construction and manufacturing jobs by offering rebates to consumers who invest in home energy improvements and energy efficient products and services.”

People power in short supply for green tech
CNet’s Green Tech blog
“In the burgeoning clean-energy business, there’s a clear need for technical breakthroughs and investment dollars. A less visible resource that’s also badly needed is seasoned entrepreneurs. One of the biggest challenges facing newly formed green-tech companies–and the field overall–is a lack of people with the appropriate technical and business skills, say experts. That’s not surprising given that so many industries, such as energy storage or solar, were relatively quiet the past two decades.”

The Home-Buyer Tax Credit Countdowns Begin
WSJ.com Developments blog
“Time is almost up on the federal home-buyer tax credit, the government’s gift of up to $8,000, crafted to jump-start a stalled housing market. Just about six weeks remain for buyers to get those contracts inked. Home builder Lennar has a bright countdown on its Web site. “TIME IS RUNNING OUT,” warns KB Home (yes, it is in all caps), which is tracking the expiration to the millisecond. …
In honor of the countdown, here are six things to keep in mind:”

How Economic Downturn Can be a Driving Force for Sustainability
Inhabitat
“The world is currently experiencing an economic downturn or recession, but by examining The Great Depression in the 1920-30’s, one may find clues as to what lies ahead for the future of design. Like The Great Depression, this recession began with a market crash, affected almost every country, caused personal income and interest rates to drop and unemployment rates to soar. However the past is filled with examples of successful, efficient designs that flourished during trying times.”

Are Tough Appraisal Rules Holding Back Housing?
WSJ.com Developments blog
“Our story on Page One today takes a look at how folks who want to build or buy homes with unusual materials are having a lot of trouble getting financing because underwriting standards are much tighter today. The problem: homes made of tires or houses caved into mountainsides don’t have any comparable sales. Without “comps,” banks won’t lend.

Even home buyers living in regular homes might be more familiar with these struggles. Appraisals have emerged as a big obstacle for homeowners of all types during the housing downturn because with fewer transactions and rapid fluctuations in prices, putting a value on homes is more difficult. In some markets, prices are falling so fast that lenders won’t accept comparable sales that are more than three months old. And reeling from rising losses, lenders have urged appraisers to be conservative.”