|FHBAction News (June 2, 2014)
By Ron Lieberman
Even as national statistics show a slowing in home-price escalation and a decline in builder confidence (see Action News item below), we can be pleased that our Florida economic outlook is as positive as it has been in years. Since December 2010, our home building/construction industry has added 63,600 jobs, according to the U.S. Bureau of Labor Statistics. That’s a 19 percent increase and a faster pace than every other sector of the economy except tourism. It’s also good news that we’re growing again as a state with a net of 20,000 new residents a quarter now coming to our state. That’s inching closer to the 100,000-a-year net growth that many believe will eventually translate into the same number of annual single-family housing starts. A big part of the growth in construction jobs has come from the specialty trades that support home building. “My plumbing contractor has doubled his staff from four to eight and these are $50,000-a-year jobs,” said Nathan Cross, President of the Greater Orlando Builders Association. Overall, Florida’s reliance on low-wage service industries gives us lower personal income than the national average but at the same time our housing remains more affordable than in most states, in part because of the availability of foreclosed homes, which are still accounting for about 25 percent of the inventory in most markets. According to Jed Kolko, chief economist for Trulia.com, the median-priced home in Florida is within reach for the average family in most areas of the state. One more sign that the future looks bright for Florida: Walt Disney is planning the largest expansion ever of the Magic Kingdom, propelled by the unveiling of another Harry Potter attraction this summer. Yes, people come to Florida for many reasons… I’m just thankful they are coming and once again making our state a great place to live, work and build.
Ron Lieberman is a third-generation home builder and developer. He is a two-time President of the Citrus County BA and a former chairman of the Citrus County Affordable Housing Authority and the Advisory Committee to the Tampa Bay Regional Transportation Authority.
FHBA Mourns Passing of Rick Dye - Richard “Rick” Dye, an Orlando builder and the son of home building industry icon Roy Dye (deceased), passed away on May 29, 2014. A memorial service will be held at First Presbyterian Church of Orlando today (June 2) at 2 pm with a reception to follow at the Alfond Inn. Rick Dye was born in Winter Park on August 31, 1961, the youngest of two children to Roy Dye and his deceased wife Shirley. Rick is survived by six children and four grandchildren. Rick graduated from the University of Florida’s M.E. Rinker School of Building Construction in 1984. He was a Past President of the Greater Orlando Builders Association and a longtime director of the Florida Home Builders Association. He was Greater Orlando’s Builder of the Year in 1992. His father Roy was one of Florida’s most prolific builders, owner of Bel-Aire Homes, and a member of the Florida Housing Hall of Fame.
FHBA Crowns Housing Champions
Sen. Wilton Simpson (R-New Port Richey) and seven members of the Florida House of Representatives have earned A+ scores from the Florida Home Builders Association (FHBA) for their staunch support of housing during the 2014 session of the Florida Legislature. The grades were announced by FHBA Governmental Affairs Committee Chairman Jeff Spear and Governmental Affairs Director and Chief Lobbyist Doug Buck after an analysis of each legislator’s voting record. “Sen. Simpson was our go-to legislator on a number of key issues,” said Buck. “He clearly earned the status of a ‘Housing Champion.’” In the Senate, 14 lawmakers earned “A” scores. In the House, Housing Champions with A+ scores were Reps. Jose Felix Diaz (R-Miami),Dane Eagle (R-Cape Coral), Matt Hudson (R-Naples), Clay Ingram (R-Pensacola), Seth McKeel (R-Lakeland),Jimmy Patronis (R-Panama City) and Speaker Will Weatherford (R-Wesley Chapel). Twenty house members earned “A” grades. FHBA enjoyed an excellent session, including securing $167 million funding under the Sadowski Affordable Housing Act, winning legislative support for $650,000 in funding of an important septic tank study, and $250,000 to enhance the fight against unlicensed activity in Florida.
Brenda McDaniel Leaving Hernando
One of the top Executive Officers in Florida – Brenda McDaniel, CEO, of the Hernando Builders Association, will be leaving her post on August 18 to move with her husband to Houston, Texas. McDaniel, who has been Hernando EO since 2008 and on the staff since 2006, is easily one of the most popular professionals among her peers, based on her upbeat attitude and willingness to share best ideas and practices on a wide range of association management responsibilities. To achieve the C O designation, McDaniel met experience and education requirements, then passed an exam that confirmed her practical knowledge as well as their intuition in solving major challenges facing builders associations. McDaniel said that the search has begun for her successor and that resumes should be sent to the Hernando Builders Association, 7391 Sunshine Grove Road, Brooksville, FL 34613.
Home Prices Up But Momentum Slows
Home prices across the U.S. are still inching up but the pace continues to lose momentum, according to a report last week in the Wall Street Journal. Prices increased 0.2 percent in the first quarter of this year from the fourth quarter of 2013, according to the S&P/Case-Shiller Home Price Index report. Compared with a year earlier, national home prices are up 10.3 percent. Smaller increases in home prices mean less wealth for many Americans via home equity, dulling some confidence in the economy. Stalled price growth also will limit choices for builders of new homes. The index covering 10 major U.S. cities increased 12.6 percent in the year that ended in March, while the 20-city index advanced 12.4 percent. That is a slowdown from February's 12.9 percent yearly pace, but better than the 11.8 percent expected by economists. "Annual price increases for the two composites have slowed in the last four months," said David M. Blitzer, chairman of the index committee at S&P Dow Jones Indices. Data on the housing market recently has been decidedly mixed. Existing home sales in April rose for the first time in 2014, while new home sales for the month jumped 6.4 percent. However, the National Association of Home Builders' confidence index for May dropped to its lowest level in 12 months. The pricing slowdown reflects weaker demand for buying a home. The report noted mortgage rates have risen from a year earlier, adding that recent comments from the Fed point to bank lending standards as a problem.
FHBA Board Set to Meet During SEBC
Under the leadership of President Ron Lieberman, the Florida Home Builders Association (FHBA) Board of Directors will hold its summer meeting on Saturday, July 26 from 2 pm to 5 pm at the Rosen Centre’ Hotel in Orlando immediately following the FHBA-sponsored Southeast Building Conference (SEBC). That Saturday morning will begin with a round of FHBA committee meetings followed by Area Caucuses (9:30 am to 10:30 am) and the Executive Committee meeting (11:30 am to 1:30 pm). On Friday, July 25, the Governmental Affairs Committee will meet from 2 pm to 5 pm at the Orange County Convention Center with Sen. Wilton Simpson (R-New Port Richey) and Dick Browdy, Chairman of the Florida Building Commission, as the highlight speakers. For more on the SEBC visit, www.sebcshow.com.
First-Time Buyers Sitting on Sidelines
Economists, real-estate agents and many home builders expected first-time and entry-level buyers to begin returning to the market this year, jump-starting the sputtering housing recovery. So far, that hasn't happened, according to a recent Wall Street Journal report. Less buying at the market's lower end by first-time buyers has contributed to limiting sales of existing homes so far this year to a pace of roughly 88 percent of their 10-year average. It's also a factor in stunting sales of newly-built homes to a pace of roughly 60 percent of their annual average since 2000. Some economists now predict that tight lending standards, high prices and the sluggish economic recovery will keep first-timers from returning in full force for several years. That likely means aslower pace for the housing recovery, already a drag on the broader economy in the past year. “We likely have hit the bottom in the past six months or so regarding the lack of participation of first-time buyers," saidLawrence Yun, chief economist for the National Association of Realtors. "It may take three years to return to normal first-time-buyer participation."
Perspectives from CEO Paul Thompson
I’ve always felt that the Executive Officer – the “EO” or chief paid executive – is the backbone of a local builders association. Presidents generally serve for one year. Leaders vary in the length and intensity of their involvement. It’s the EO who provides the “glue”… the continuity that keeps an association humming year after year. As I look back at a 40-plus-year career with builders associations, there were many now-retired EOs whose work I greatly admired. One was Howard Head, who guided the original Florida Atlantic BA in the 1970s and 80s and went on to found the Bonded Builders Warranty Group. Howard is famous for conceiving and executing a “We Want to Work” parade of construction vehicles to successfully protest a proposedpopulation cap in the city of Boca Raton… and Howard mentored another of our great former EOs – Gail Kavanagh, who enjoyed a long and distinguished career with the Treasure Coast BA. Another is Whit Ward, who actually guided three BAs in Florida – Tampa, Gold Coast and Collier – and went onto join Head as the President of Bonded Builders. Then there is Joseph Narkiewicz, a prince of a man who was EO at the Pasco and Tampa Bay associations. And of course Michael Reitmann, who just came out of a brief retirement to help his Lee BIA through a new-EO transition. It’s no surprise that Howard, Whit, Joseph and Michael are all in the Florida Housing Hall of Fame… or that they are the kind of people who continue to supply big doses of advice and encouragement to the new generation of EOs. But when it comes to remarkable EOs… I think almost everyone would agree that Arnold Tritt, long-retired from the Northeast Florida BA in Jacksonville, stands at the head of the class. Unique in personality and style, Arnold topped the charts in public relations, motivational and management skills. His office looked the victim of a Category 5 Hurricane, with papers everywhere, but remarkably he could find any information he needed in a matter of second. And don’t be fooled by his slow, down-home drawl… Arnold was playing chess while the rest of us played checkers. He knew exactly what he was doing which is how he created what became the largest and richest HBA in the country. Perhaps Arnold’s best and most lasting quality was as a mentor. He employed, trained and molded some of the best EOs in the country: including Reitmann, West Florida’s David Peaden, Atlanta’s David Ellis, Polk and Marion’s Mitzi Perry (now deceased), Greater Orlando’s Richard Allison, and mostly recently, his successor Daniel Davis who became a state legislator and now runs Jacksonville’s mega-Chamber of Commerce. Peaden remembers Tritt’s quirky sense of humor, including the first time they met and Arnold said: "Welcome to Jacksonville... the largest city in south Georgia." Peaden recalls: “After a long day of work, I would leave the office at 6:30 p.m. As I walked by Arnold's office, he would say, ‘Must be nice leaving early!’ Or if I did something good during the work week, he would tell me, ‘Hey, that's great! Take a half day off on Sunday.’” But like all of Tritt’s protégés, Peaden came to understand the method of Arnold’s madness. “I quickly learned that he had a reason for everything he did,” said Peaden. “He provided me with support and gave me a chance to succeed. Arnold was undoubtedly tough, but he was always fair. He encouraged me to learn all I could about the association management business. He took me to conferences both state and national so I could see the bigger picture. Although I did not recognize it at the time, he was preparing me for the future. For his tireless support, I will forever be grateful to him for taking a chance on me. He is truly a legend in our industry and I love and respect him immensely.” David, I couldn’t agree more.
Paul Thompson, CAE, MIRM, is CEO/Executive Vice President of the Florida Home Builders Association and holds an MBA from Florida State University.