Softwood lumber, oriented strand board, ready-mix concrete, and gypsum products all posted price changes in 2016 well above the 1.3% average for the Consumer Price Index, according to the latest Producer Price index released by the Bureau of Labor Statistics.
Oriented strand board prices surged 13.8% in 2016, while softwood lumber rose nearly 8.7%. In November, the cost of ready-mix concrete and gypsum products rose 3.5% and 5.0%, respectively, on a year-over-year basis.
In an ominous sign, the price of softwood lumber rose by 2.3% in December, which is the largest monthly increase since April 2016.
A nine-year softwood lumber agreement between the U.S. and Canada that established a system of fees and quotas on Canadian imports to the U.S. triggered in response to changes in the market price of softwood lumber expired in October 2015.
Negotiations on a new agreement have failed. U.S. lumber producers recently filed a petition with the International Trade Commission, reigniting a long-term trade battle between the two countries.
National Association of Home Builders is fighting to ensure American consumers have access to a stable, dependable, and affordable lumber supply.
The National Association of Home Builders’ Board of Directors approved six funding requests, including the Reedy River proposal from the Home Builders Association of Greenville. These proposals came from state and local HBAs requesting help with their advocacy efforts through the National Association of Home Builders State & Local Issues Fund.
The board acted on the recommendation of the State and Local Government Affairs Committee, which reviewed the requests during its meeting at the International Builders’ Show in early January.
The Reedy River, a signature part of the Greenville, S.C., community is impaired by nitrogen. The Home Builders Association of Greenville and a community coalition together have addressed the issue with stormwater regulations and modernization of sewer treatment facilities. Coalition partners have aggressively opposed the state’s efforts to place a Total Maximum Daily Load regulation on nitrogen on the Reedy River. They support an alternative called 5R, a community-based, bottom-up plan to accomplish same result as a Total Maximum Daily Load regulation but without costly litigation. The board approved $20,000 to build an economic model to show community-based collations in Greenville and other HBAs how they can solve environmental impairment problems without Total Maximum Daily Load regulations and costly litigation.
Click here to see the other five proposals.
National Association of Home Builders has joined several other industry groups to file a challenge against the Occupational Safety and Health Administration and the Department of Labor regarding OSHA’s final Improve Tracking of Workplace Injuries and Illnesses rule, which National Association of Home Builders Chairman Ed Brady called “unlawful and arbitrary” in a press statement issued Thursday.
“We have vigorously opposed this rule from the start, and cannot allow this type of regulatory overreach to occur,” Brady said.
“There are significant concerns associated with Occupational Safety and Health Administration’s requirement of employers to submit detailed injury and illness logs to the agency for public posting. Not only does Occupational Safety and Health Administration not have the authority to do this, it also exposes a business to significant reputational harm, all without demonstrating any evidence that it would effectively reduce workplace injuries and illnesses,” he said.
“We also have serious concerns about the anti-retaliation portion of the rule, which would allow Occupational Safety and Health Administration inspectors to cite an employer without needing a complaint from a worker. This is a clear overreach of authority, as it goes against Congress’s carefully constructed mechanism to address retaliation that is specifically set forth in the Occupational Safety and Health Administration statute.
“Occupational Safety and Health Administration has not justified any of the rule’s requirements with any real benefits analysis and has relied entirely on anecdotal information. This is entirely insufficient and cannot be allowed to stand and potentially serve as a precedent for other agency rules. Workplace safety is of the utmost concern of our members, however this rule is unlawful and does not serve its intended purpose of improving workplace safety. The rule needs to be vacated and set aside in its entirety,” Brady said.
One thousand dollars might sound insignificant when compared to the overall price of a new home. But that relatively small amount of money has a surprisingly big impact on affordability.
The National Association of Home Builders economists recently determined that for every $1,000 increase in the cost of today’s median-priced home, nearly 153,000 American households are priced out and would no longer be able to afford it.
Many builders and developers are finding it increasingly difficult to avoid these price jumps in the face of mounting regulations and government-imposed fees, which can add up quickly and shut the door on a growing number of prospective buyers.
Those numbers become even more eye-opening when looking at potential interest rate increases. With just a quarter-point rise in the rate for a 30-year fixed-rate mortgage, approximately 1.2 million people would be priced out of that segment of the market and forced to set their sights lower than a median-priced home—or delay their home purchase altogether.
But the impact varies widely across the country. The effects are more significant in areas where new homes are more affordable.
Eye On Housing recently revealed which states and metro areas have the highest percentage of priced-out households.
The Federal Housing Finance Agency today announced that the maximum baseline conforming loan limit for mortgage loans acquired by Fannie Mae and Freddie Mac in 2017 will increase to $424,100 from $417,000. This will be the first increase in the conforming loan limit since it was raised to $417,000 in 2006.
The Housing and Economic Recovery Act of 2008 established $417,000 as the baseline loan limit and mandated that after a period of price declines, the baseline loan limit would not be permitted to rise until home prices had returned to pre-decline levels.
The loan limit will rise 1.7% in 2017 because the Federal Housing Finance Agency has determined that the average U.S. home value in the third quarter of this year increased 1.7% above its level in the third quarter of 2007.
Higher loan limits will be in effect in higher-cost areas as well. In areas where 115% of the local median home value exceeds the baseline loan limit, the maximum area loan limit will be higher. The new ceiling loan limit in high-cost markets will be $636,150 (150% of the $424,100) for single-family properties. The previous ceiling was $625,500.
Special statutory provisions establish different loan limit calculations for Alaska, Hawaii, Guam and the U.S. Virgin Islands. In these areas, the baseline loan limit will be $636,150 for single-family properties, but actual loan limits may be higher in some specific locations. A list of the 2017 maximum conforming loan limits for all counties and county-equivalent areas in the country may be found here.