As a homebuilder that grew up in Anchorage, dedicated hundreds of hours towards the rewrite of Title 21 and applauds the Mayors attempt to take a small step towards easing the pain that the proposed rewrite would levy on the wallets of Anchorage home buyers; I find Tuesday’s letter short sighted and offensive.

I don’t think that we should call the Mayor’s efforts to NOT price our work force out of the housing market a “Body Blow”.  Nor do I think it “Beautifies Anchorage” to promote a land use code that raises cost without providing value thus encouraging it’s workforce to commute from the Valley.

One size fits all solutions don’t really work and will discourage creative design.  The Architects, Engineers and Homebuilders supporting the Mayor’s revision of T21 are the same people volunteering to clean the ROW, coaching youth sports, passing you on the trail up Flattop and writing this letter.  We don’t want to ruin Anchorage and believe me when I say that the Mayor took a step in the right direction.

Title 21 Re-Write’s negative effect on Housing Affordability

Andre Spinelli, President Anchorage Home Builders

As we wait for the Municipality of Anchorage to release the final version of the Title 21 re-write (Land use and Zoning Code) that will go before the Planning and Zoning Commission for Public Hearing on November 14^th at 6:30 p.m. at the Assembly Chambers of the Loussac Library, I thought it would be a good idea for everyone to take quick look at the impact of the new code (as it is currently on the MOA website) on the cost of entry level home.

When the process of re-writing Title 21 began there was an Economic Impact Analysis done that excluded the single home.  Below I show you what happens to the cost of your new home when you compare your budget with the revised Title 21’s NEW REQUIREMENTS. 

• 21.07.080.E.8 Trees in Residential Developments – Title 21 NEW REQUIREMENTS are double or triple the number of trees and makse them taller.  165 tree units per acre.  The average house on a ¼ acre lot 165/4=41.25 units.  A 6’ evergreen=6 units and a 14’deciduous =4 units.  The average number of trees installed today is three per house.  Title 21 NOW REQUIRES 10 trees at a cost of $5000.  $4,100 cost increase.
• 21.07.110.F.2 Mix of Housing Models – Choosing a different floor plan costs nothing but unfortunately all the buyers choose the best plans over and over.  Title 21 NOW REQUIRES a mandatory mix of housing models.  5 houses = 2 plans, 11 houses=4 plans, 21 houses=5 plans.  With all the new taller trees who will even notice? Not to mention that Turnagain on the Westside and South Addition in Downtown are examples of great neighborhoods with repetitive house plans that nobody seems to mind.
• 21.07.110.F.3.a,b&c Primary entrance Location – Title 21 NOW REQUIRES front door must be clearly visible from the street, must be covered and must have a hard surfaced walkway. This doesn’t sound that bad but why is the MOA telling where to put my door?  Also at my house I actually have meandering flat rocks leading to my front door surrounded by grass which would not be allowed.  Put your stereotypes aside about who is supporting this code because I can’t think of any environmental groups that encourage more asphalt pavement than current code. Title 21 NEW REQUIREMENTS cost of covered porch $400.
• 21.07.110.F.4.b Garages – Garage doors shall comprise no more than 60% of the total width of the building’ elevation.  If you were planning to have a two car garage we might have to stretch the width of your house. Garages in building less than 40 feet wide will also be additionally penalized.  You have three lists and you MUST choose one item from each list.  Title 21 NEW REQUIREMENTS must include front facing balcony, decorative covered entry, additional detailed trim on all doors, windows and roof edges.  Title 21 NEW REQUIREMENTS costs of garage changes $1750.
• 21.07.11.F.5.a Windows — Title 21 NOW REQUIRES that windows and primary entrance shall occupy 15% of the elevation.  If you add a slider door and a deck per the list above the total of the elevation is 70 sq ft and you are required to have 92 sq ft of windows out front.  Title 21 NEW REQUIREMENTS on windows is $750.

All of the Title 21 NEW REQUIREMENTS add up to a total of $7,000. in additional costs and I was very modest with my pricing.  I also have not factored in the cost increase of the permit to build the house because the MOA has stated that the cost of the permit will not increase but this is very foolish at best.  How can you add so much new regulation to review and inspect without thinking that there will be additional cost? Maybe if you just don’t think about it? In this example I used a house that would typically costs $250,000 that $7,000 is a 2.7% increase in the cost of the home. Title 21 NEW REQUIREMENTS will impact the housing market by making it much harder for the average Anchorage resident to afford a home.

WASHINGTON, Oct. 6 – The second edition of the National Association of Home Builders/First American Improving Markets Index (IMI), released today, shows 23 individual housing markets now qualifying as “improving” under the new gauge’s parameters. This is nearly double the 12 housing markets that made the list last month.

The index reveals metropolitan areas that have shown improvement for at least six months in housing permits, employment and housing prices. The following metros were listed in October:

·       Alexandria, LA

·       Amarillo, TX

·       Anchorage, AK

·       Bismarck, ND

·       Casper, WY

·       Fairbanks, AK

·       Fayetteville, NC

·       Houma, LA

·       Iowa City, IA

·       Jonesboro, AR

·       Kankakee, IL

·       McAllen, TX

·       Midland, TX

·       New Orleans, LA

·       Odessa, TX

·       Pine Bluff, AR

·       Pittsburgh, PA

·       Sherman, TX

·       Sumter, SC

·       Waco, TX

·       Waterloo, IA

·       Wichita Falls, TX

·       Winston-Salem, NC

“Both the number and geographic diversity of improving housing markets expanded this month, with Iowa, Illinois and South Carolina all newly represented by one entry or more on the list,” said National Association of Home Builders (NAHB) Chairman Bob Nielsen, a home builder from Reno, Nev. “This is further evidence that, despite the tough conditions that persist in many cities, pockets of improvement are emerging in local housing markets across the country.”

“While Pittsburgh and New Orleans remain the two largest improving markets, the October IMI is heavily weighted by smaller cities in which energy and agriculture are the primary economic drivers and where the effects of the recession have been less pronounced,” said NAHB Chief Economist David Crowe. “In particular, Texas stands out for its seven entries on the improving markets list.”

Bangor, Maine, was the only area to drop off of the improving markets list in October, due to a decline in local building permits.

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 improving 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 areas for at least six months following their respective troughs before being included on the improving markets list.

Please visit www.nahb.org/imi for additional data, tables and a list of 2011 future economic release dates.

Editor’s Note: The NAHB/First American Improving Markets Index (IMI) is released on the fourth business day of each month at 10:00 a.m. ET, unless that day falls on a Friday – in which case, the index will be released the following Monday. A full calendar of 2011 release dates can be found at www.nahb.org/imi.

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ABOUT NAHB: The National Association of Home Builders is a Washington-based trade association representing more than 160,000 members involved in home building, remodeling, multifamily construction, property management, subcontracting, design, housing finance, building product manufacturing and other aspects of residential and light commercial construction. NAHB is affiliated with 800 state and local home builders associations around the country. NAHB’s builder members will construct about 80 percent of the new housing units projected for this year.

The Anchorage Construction Academy provides basic construction training for adults who are seeking skills that can lead to a good-paying job in the construction industry. Are you looking for a great paying career in construction?

We offer basic construction skills classes in:

• Carpentry
• Welding
• Electrical
• Plumbing
• Health & Safety
• Trades Math

The 2011 Anchorage Home Builders Association (AHBA) Parade of Homes is this weekend, September 10-12! Thank you for taking the time to consider what may be in store for you this year. All of the single-family, condo and townhouse style homes in the Parade (as you may already know) are required to be completely finished for your enjoyment. Many of them will be for sale and ready to move in. Prices of the homes on Parade run the spectrum – from an affordable condominium listed at $194,400 to a $655,000 custom. In most cases, the builder as well as the realtor will be at the homes. This presents a unique opportunity to evaluate and establish relationships that are so important in making the home building process successful and fun. Don’t miss your chance to meet the people behind the product.

Even if you are not in the home buying mood, the Parade of homes is a great chance to get some decorating ideas, and to see the latest trends in building design, appliances, colors and layouts. If nothing else, the Parade offers great inspiration for that “dream home to own someday” or the motivation to get going on that home renovation project. Finally, I am honored to be a member of 230+ companies of the Anchorage home Builders Association. I think you’ll agree that we are lucky to call Anchorage home, and even more fortunate to have the freedom to choose the type of home we want to live in, located in one of the most beautiful places on earth-Alaska! We are hoping for good weather and your good cheer for this year’s tour on september 10th, 11th, a1nd 12th.

After you have viewed the homes, please visit the People’s Choice Award Voting page and submit your vote for the Builders Millwork Supply People’s Choice Award.

Thank you once again,
Andre Spinelli
Anchorage Home Builders Association, President

For several years now we at the Anchorage Home Builders Association (AHBA) have been experiencing difficulties in getting timely service from the Municipality of Anchorage (MOA) Department of Development Services.  The impact to the residential construction industry is huge.  As of June ’11 new home starts are below June ’10 and down by over half of June ’05 while housing demand and the cost of rent are going up, fast!  So what’s going on?

First the permit submittal and plan review technicians have been left so short staffed that they often are buried by the backed up files.  With no light at the end of the tunnel MOA’s productivity seems to slow to a creep while the industry burns rubber waiting for the light to turn green.  This is not a new issue, in years past the AHBA and Building Safety worked together to avoid an issue like this.  It was agreed in the late 90’s that the MOA would raise permit fee’s in order to build up a savings with the support of AHBA.  This was done to ensure a high level of quality and service in years when permit starts might fall.  Unfortunately under the Begich administration this savings was discovered and quickly transferred out to other departments or used to purchase expensive Hansen computer software.  This software has yet to be fully implemented or any of the expected savings realized.  In fact the opposite is true; the time to accomplish simple tasks has increased and in my informal poll of municipal employees about the Hansen software the “thumbs down” was unanimous.

Concurrent with the above described situation Development Services has gone through a major reorganization in which the previous Building Official of 14 years, Ron Thompson, was promoted to Public Works Director and replaced by a Plan Review Engineer from the Private Development Department, Sharen Walsh.  Our new Building Official came from a department which was outside of Building Safety prior to the reorganization and understandably unfamiliar with the particulars of the department.  As a result our new Building Official has had to rely heavily on the council of the senior employee’s ready to stretch their wings after operating under the constraints of a strong Building Official who for 14 years kept private industry satisfied with his restraint of the constantly expanding scope of the Municipal review and inspection of our buildings.  So now in true government fashion, Building Safety is doing more work with less resources and the sacrifice is that the time it takes to get things done has increased.

In the private sector there are penalties to not meeting deadlines but in a government run monopoly there are none.  When it comes to building houses in Eagle River, Girdwood, area’s of Bear Valley and Stuckagain Heights the Municipalities codes are applied but the plan review and inspections are handled privately.  All this is done at a cost and time savings of an average $2,000 and 2-4 weeks (sometimes longer).  This is why the Anchorage Home Builders Association is encouraging the Municipality to take a serious look at allowing the use of private plan reviews and inspections of houses now that the government provided system appears to be bogged down and broken.

MOA’s Building Safety Department needs to grow up and realize that they too have to follow the rules of the MOA administrative code.  Making it up as they go along is not fair to anyone.  The real bottom line is they need to accept that they can not continue to run the department at a loss.  Get efficient and run the department just like all of us has had to do in this economy by finding economical ways to get the job done.  Allow us the option of private plan review and inspections!

THURSDAY, OCTOBER 13, 2011

12:00 – 3:00 PM

INSTRUCTOR: RITA EMMETT

LOCATION: WILDA MARSTON THEATRE

LOUSSAC LIBRARY — 3600 DENALI STREET

COST: MEMBERS $39** NON-MEMBERS $79

**If a member brings a guest, admission is 2 for the price of 1!

Communication is the key to relationships at work, at home, anywhere. Yet, did you know research tells us that only 7% of our communication is based on the meaning of our words? Scary, isn’t it? Understanding the other 93% – body language and voice quality, along with improved listening skills can turn you into a powerful communicator.

Get the Power Up Flyer (PDF format).

We saw this excellent article about the increase in use of tax energy credits on the NAHB blog, and encourage our members to learn about the changes.

In 2009, the rules for the tax code section 25C $1,500 energy-efficient improvement tax credit and the uncapped 25D 30% tax credit for home power production equipment tax credit were significantly expanded. The 25C credit is used to improve existing primary residences by installing energy-efficient windows, doors, roofing, and some home property like water heaters. The 25D credit, which rewards homeowners for installing solar panels, geothermal heat pumps, small wind turbines and fuel cells, can be used in existing homes and new construction.

The result of the 2009 policy change was a significant increase in the use of these tax credits, which led to remodeling activity and job creation. And we now have 2009 IRS data that allows tracking where the credit was claimed. The results indicate that while the largest states, in terms of homes and population, witnessed the largest tax credit claims, there was also geographic clustering of credit claims on a per taxpayer basis.

Read the full article at the NAHB Eye on Housing Blog.

Standing Up for Housing

As lawmakers mull whether the mortgage interest deduction should be on the chopping block in order to rein in the growing federal deficit or change the federal tax code, Rep. Do Young should be commended for co-sponsoring H.Res.25, a House resolution which expresses the sense of Congress that the mortgage interest deduction should not be altered in any way.

Rep. Don Young understands that cutting the tax benefits associated with owning a home would deliver a serious body blow to the fragile housing recovery by inflicting a huge tax hike on millions of middle-class home owners. The collateral damage to the economy would be even more severe, reducing household wealth and placing more downward pressure on housing prices, which would further weaken housing demand, leave more home owners underwater and cause a spike in foreclosures.

By supporting H.Res.25, Rep. Don Young is sending a clear message that owning a home remains an essential part of the American Dream and imposing additional taxes on America’s home owners is not the answer to solve our nation’s fiscal problems.

To read the resolution and see a list of the current co-sponsors, readers can log on to www.SaveMyMid.com/action.