Housing Expands Amid Slowing Economy

By Rob Deitz, PhD., Chief Economist, National Association of Home Builders

The economy has slowed, as evidenced by a 1.9% estimated GDP growth rate in the third quarter of 2019. Yet, housing continues to rebound thanks largely to lower mortgage interest rates, resulting in gains for single-family permits and starts since last spring. The home building component of GDP, residential fixed investment, made a positive contribution to the headline third quarter GDP number after six prior quarters of declines. Home building contributed 0.18 basis points to the headline 1.9% growth rate.

However, the slowing economy and anchored inflation data led the Federal Reserve to lower its federal funds target to a top interest rate of 1.75%. This marks the third cut of 25 basis points in 2019, after four rate hikes in 2018. In retrospect, the 2018 tightening of monetary policy was a policy mistake given tame inflation data and rising macroeconomic headwinds. That said, the revised, current dovish stance of the Fed — particularly its effect of lowering mortgage interest rates — has been a positive factor for housing since the spring.

The rebound for housing in 2019 is clear in recent home building data. The NAHB/Wells Fargo Housing Market Index (HMI) increased to a level of 71 in October, a 20-month high. Single-family starts increased to a 918,000 annual pace in September, marking four months of gains. While new home sales were relatively flat in September, sales are running 7.2% higher in 2019 on a year-to-date basis compared to 2018 transaction volume. And new inventory is down to a 5.5-month supply, suggesting additional construction gains ahead.

HBA Elections, Bylaws Amendment, and Annual Meeting

To: Home Builders Association of Greenville Members

From: Matt Shouse, APB, President, Vice Chairman, Leadership Development Committee

James Speer, APB, Immediate Past President, Chairman, Leadership Development Committee

Re: Leadership Development Committee Report

As we approach the end of another year, your association will hold elections for our 2020 Board of Directors. Our Annual Meeting is set for Thursday, October 24, 2019, 5:30 p.m., at Elevations Cabinetry and Design by GBS. The Annual Meeting will be held in conjunction with the annual Chili Cook Off and Oyster Roast.

The Annual Meeting agenda will consist of election of the 2019 Board of Directors as well as on a proposal to amend our bylaws. We expect to convene the Annual Meeting at approximately 6:45 p.m., after the winners of the Chili Cook Off contest are announced.

As a member of your Home Builders Association, you are encouraged to exercise your privilege of voting on the slate of officers and directors who have agreed to lead your association in 2020 and on the proposed bylaws amendment. To do that, you can attend the annual meeting on October 24, or you can submit a proxy form to our Secretary-Treasurer, Scott Presley, who will cast your vote for you if you are unable to attend the Annual Meeting.

A Report of Nominations and proxy card have been mailed to each member in good standing at the mailing address we have on file for you.

Voting Online
The Report of Nominations is posted below.  To vote online, click this link and follow the instructions.

If you attend the annual meeting, the vote you cast there will be the vote that is counted. If you are not able to attend the Annual Meeting, please vote by proxy.

2020 Slate of Officers and Directors

The Leadership Development Committee met June 11, 2019, and August 6, 2019, as well as informally by email.  Michael Dey, Executive Vice President and Chief Executive Officer, also issued a call for nominations on behalf of the committee by publishing the call in Builder Review, the association’s newsletter.  The following is a report of nominations made for the various offices of the Home Builders Association of Greenville, S.C., Inc.  These nominations were reviewed and ratified by the Board of Directors at their meeting on August 20, 2019, and are recommended to the General Membership of the Home Builders Association of Greenville to be voted upon and approved in the manner provided for by the Bylaws and policies of the association.

Position                                        Member                                                                          Term Ends

President                                       Bill Kane, APB, Ryan Homes                                          12/31/2020

President Elect                              Ben Moseley, The Heirloom Companies                         12/31/2020

Vice President                               Steve Carson, APB, CarsonSpeer Builders                    12/31/2020

Associate Vice President              Dustin Hughes, Jeff Lynch Appliance and TV Center     12/31/2021

Immediate Past President             Matt Shouse, APB, LS Homes                                        12/31/2020

Secretary-Treasurer                      Chuck Childress, BB&T                                                   12/31/2021

Director                                         Chris Bailey, APB, Stoneledge Properties                       12/31/2022

Director                                         Drew Hamblen, APB, Fairview Custom Homes               12/31/2021

Director/SMC Chairman               Trina Montalbano, APB, DR Horton                                  12/31/2020

Director/PWB Chairman              Emily Raines, APB, Dan Ryan Builders                            12/31/2020

Additional Directors continuing in unexpired terms

The Leadership Development Committee also reports that the following director, who has previously been duly elected, will serve in 2020 in the following position:

Position                                         Member                                                                         Term Ends

Director                                         Will Cord, APB, Daniel Builders                                       12/31/2021

Director                                         Dave Hagan, APB, Ryan Homes                                     12/31/2020

Director                                         Alan Wilson, Clark’s Termite and Pest Control                 12/31/2020

Bylaws Amendment

Your association’s Board of Directors also has recommended amendments to the association’s bylaws.  These amendments are part of a routine review of the bylaws for compliance with the law as well as amendments that have been proposed to improve the association’s ability to respond to a changing housing, construction, and real estate development industry.  These amendments are in three key areas:

  1. Implement reforms to the association’s membership model.
  2. Shorten the bylaws by removing matters that are better addressed in policy, particularly matters that may need to be changed frequently to adjust to a changing association business environment that will help the association remain relevant.
  3. Address any changes in law or mandates from affiliated associations.

To review the fully annotated bylaws amendments, and to read the report of the bylaws amendments, click on the links below.

Bylaws DRAFT

Bylaws Report

To implement these Bylaws amendments, the Board of Directors has approved three new policies and amended a fourth policy.  Click on the links below to download and review them.

Affiliated Dues Payment Policy

Attendance Policy

Membership Categories Policy

Rules of Order

Mission, Vision, and Values

Voting rules from the Bylaws

The Designated Member of each member company, and Affiliate Members of each member company, are entitled to one vote each.  Members may vote in one of the following ways:

  1. In person at the Annual Meeting on Thursday, October 24, 5:30 p.m., at Elevations Cabinetry and Design by GBS, 711 Congaree Road, Greenville.
  2. Authorize Secretary-Treasurer Scott Presley to cast your vote for you by signing the enclosed proxy card and returning it to the Association.  The deadline to submit a proxy card is Wednesday, October 23, 2019, 5 p.m.
  3. Authorize Secretary-Treasurer Scott Presley to cast your vote for you by executing a proxy online by clicking here following the instructions.  The deadline to submit a proxy is Wednesday, October 23, 2019, 5 p.m.

Quorum: A quorum is 10 percent of the members in each membership category (Builder, Associate, and Affiliate).

Click here to vote by proxy

Your HBA is Remodeling!

Your HBA is Remodeling!

It is finally happening!  The remodel of your HBA Office is underway.  But we need your help.

Please consider making a donation to the association’s building remodel project.  Our needs include:

  • Flooring
  • Brush clearing and landscaping, including mulch and new plantings, and an extension of our existing irrigation system
  • Help painting the building inside and out (the paint has been donated!)
  • New signage
  • Monetary donations to help us purchase new furniture, to upgrade office technology, and pay for general contracting for the office up fits

In fact, monetary donations may be our most important need.  Members have been incredibly generous with in-kind contributions, but any remodel can’t be accomplished without hiring some of the work and paying for needs that are not typical of our industry, but needed for a modern association office.

Your association’s building should be a source of pride. Your association has owned its building since 1999.  It was beautiful then, but 20 years of wear and tear have taken its toll.
The association’s office belongs to every member. Can you help?  Together we can build an association office that is a source of pride and that positively represents your industry in the community.

For more information on specific needs, please contact Taylor at the HBA Office.

We also would like to thank our Project Chairman, James Anderson of HomeTrust Bank.  James has been on the phone with many of you already.  Thank you James for all of your hard work on this project.

Participate in the Greenville County Comprehensive Planning Process

Participate in the Greenville County Comprehensive Planning Process

Greenville County is updating its Comprehensive Land Use Plan for the next decade.

During the month of February, there will be nine community meetings, hundreds of hours at interactive stations and a mapping table, and thousands of citizen opinions provided in surveys and face-to-face discussions for the effort dubbed “Plan Greenville County.” In the words of the County Council Chairman Butch Kirven, “It’s a big deal!”

As Home Builders and real estate professionals, it is important that your voice is heard.  Drop-in style community meetings begin February 4. Officials say that citizen-driven priorities, preferences, and concerns will guide the creation of the 10-year plan.

Potential topics of discussion include growth, traffic, public transportation, housing, economic development, and jobs.

The Meeting Schedule

  • Monday, Feb. 4, 5-8 p.m. at Travelers Rest High School Commons/Cafeteria
  • Thursday, Feb. 7, 5-8 p.m. at Eastside High School Media Center
  • Monday, Feb. 11, 5-8 p.m. at Bells Crossing Elementary School Cafeteria
  • Tuesday, Feb. 12, 5-8 p.m. at Woodmont High School Commons/Cafeteria
  • Thursday, Feb. 14, 5-8 p.m. at Berea High School Commons/Cafeteria
  • Thursday, Feb. 21, 11 a.m.-7 p.m. at County Square, Suite 400
  • Monday, Feb. 25, 5-8 p.m. at Blue Ridge High School Commons/Cafeteria
  • Tuesday, Feb. 26, 5-8 p.m. at Ralph Chandler Middle School Cafeteria
  • Thursday, Feb. 28, 5-8 p.m. at Mount Pleasant Community Center

Visit the website by clicking here.

Entertainment Benefits Group is the Newest Member Savings Program

Entertainment Benefits Group is the Newest Member Savings Program

Being a member of NAHB has many perks, including access to great deals through your HBA’s Member Savings program. Members can enjoy discounts on everything from new computers to building supplies to vehicles.

Members can now add entertainment and travel to that list, thanks to a new affinity program with Entertainment Benefits Group (EBG). EBG, an e-commerce company, owns and operates the largest entertainment, sports and travel benefits program in the country. Products and services include:

  1. Hotels
  2. Theme parks (e.g., Disney, Universal Studios, SeaWorld)
  3. Movie tickets (including AMC, Regal, Cinemark, and more)
  4. Top shows and concerts
  5. Tours and attractions
  6. Zoos and aquariums
  7. Ski lift tickets and rental equipment

EBG serves more than 40,000 companies, providing more than 50 million employees with access to exclusive perks nationwide.

Learn more about these member perks from EBG and other important members savings programs at the NAHB Member Savings page.

Unearth the No. 1 Cause of Structural Failures

Unearth the No. 1 Cause of Structural Failures

by Walt Keaveny, MS, PE, PG, Risk Manager, 2-10 Home Buyers Warranty

What is the leading cause of residential structural failures? Did you guess expansive soils? Sof t organic soils? Improper drainage? How about inadequate engineering design? Low-strength concrete? Poor framing practices? Nope, none of those. What may surprise you is that the leading cause of structural failures is avoidable. Warnings to avoid this significant construction liability are found in project specifications, common codes, and industry standards. What then is this real hazard that is misunderstood and overlooked? Improperly compacted structural fill material.

2-10 Home Buyers Warranty (2-10 HBW) is the national leader in new home structural warranties, who has nearly 40 years of forensic analytics and investigations that concludes fill material is the leading cause of residential structural failures. These failures can occur anywhere that existing or new fill material is used to support a foundation. Since 80% of all structural failures are due to soil movement beneath the foundation, proper use of structural fill is every bit as critical as determining building location, selecting trade partners, and a sellable home design.

Structural fill material must be of sufficient quality and density, or else it can consolidate, causing excessive settlement. This may result in damage to foundations, framing, and interior finishes. Structural distress resulting from improper fill is likely to begin soon after construction is completed. Due to common over-irrigation of the new landscaping and concentrated roof drainage, the fill quickly consolidates under the new foundation load and it is saturated and further weakened. Less than a one foot thickness of improper fill may cause serious distress. The damage caused by fill is typically more severe and costly to repair than other causes of structural failures. This is because the entire foundation is commonly underlain by fill. The average cost to investigate and repair a qualifying fill claim is about $50,000. This does not include the cost of the home builder’s reputation for quality construction practices.

To avoid structural failures caused by fill material, builders should confirm that prospective land to be developed with “existing” fill was properly compacted and tested. Developers typically sell land “as-is”, leaving the home builder liable for any existing fill. “New” structural fill to be placed by the home builder should be properly compacted and tested to verify the density. This is an industry standard practice, and a requirement of the local, state, and International Building Codes (IBC), the building department, plans and specifications, geotechnical engineer, and Department of Housing and Urban Development (HUD).

HUD’s requirements are specified in their Data Sheet 79G Land Development with Controlled Earthwork which states, “For any development in which buildings are to be placed on graded areas, all earthwork shall be designed, engineered, and constructed in such a manner that there will be no adverse differential movement which may cause damage to the structure…” HUD further specifies that, “Field density tests shall be made by the Soils Engineer…” Structural fill material should be placed in relatively thin lifts at, or near, optimum moisture content. Just the right amount of moisture lubricates the fill which allows it to achieve optimum density. Optimum moisture and density for a particular fill are determined using a Proctor test in a soils laboratory. Each lif t should be properly compacted. It is important to note that the weight of the bull dozer or front-end loader used to place the fill is typically not sufficient to compact the fill. Dozers and loaders spread their weight over wide tracks, or tires, to avoid getting stuck, and are not designed to impart sufficient compactive effort like a true soil compactor. Density testing, conducted by a representative of the geotechnical engineer, should be used to confirm and document if proper compaction has been achieved to protect the home builder’s liability.

Home builders can rely on the expertise of a geotechnical engineer, as needed, in order to identify existing undocumented fill, specif y proper cut and fill methods, specify fill quality and compaction criteria, identify onsite and offsite fill sources, and test for proper fill density. The engineer can also assist the home builder to avoid other common problems associated with improperly compacted fill, such as slope failures, retaining wall failures, and drainage problems.

In summary, diligent practices regarding structural fill material include:

  1. Check prospective land for existing undocumented fill
  2. Check fill quality and use proper fill placement methods
  3. Use the proper equipment for fill compaction
  4. Test and document fill density
  5. Utilize a geotechnical engineer as needed

Structural failures caused by fill material are avoidable. Proper fill placement will help protect a home builder’s liability and hard-earned reputation.