A message from the Chairman
As we launched our National Association of Independent Home Builders and Remodelers, also known as NAIHBR, each one of the founders had a reason to work together building a national platform that creates opportunities for builders, mortgage lenders, suppliers, and realtors to work together for the betterment of local economies. Homeownership has proven over time to be a powerful force for creating family stability and wealth over time.
Many of us grew up when the US population was under 200M in the ancient 1970s , and today it stands at 325M strong. We haven’t added any new states, but have added the need for more housing. We should reach 1.2M new new housing starts in 2017; but did you know this is less than half of the pre-housing crisis in the mid-2000s? The good news is new construction is on the rise fueled by consumer demand, low interest rates, and an aging housing stock. There are certainly tailwind behind the Construction / Renovation movement.
The economic value of home ownership has proven itself over the test of time. One of our Directors, Mike Wolson is with Baird and Warner, which was formed in 1855. Imagine back then, a new home was $1400! Now a new home averages almost $280 thousand.
We have seen home prices appreciate consistently through decades. Over the life cycle of a family’s time in a home, typically it has the potential to triple in value over 30 years while the mortgage typically finds its way down to zero. This means the value of homes can create a sizable asset that can be used for retirement, especially when the children are grown and out of the home.
When we read that the homeownership in the US is reaching 50-year lows, we all become disheartened that the long road to the “American Dream” has been challenged. We can either accept the rate will continue to fall or proactively work together on a better solution.
As new construction is almost one in six transactions, and the fact that there is $350B of renovation spend per year, we already have momentum on our side. As an industry we have the foundation with all the key players to address the housing shortage and lack of equity appreciation in many local markets (still over 3M underwater mortgages linger).
NAIHBR believes if lenders, realtors, builders, and industry leaders work together on creating a more efficient approach to serve the consumer, new construction and renovation will accelerate. Our hypothesis was tested in launching the organization in the Illinois market. Within 3 months of starting, we recruited 1000 members and recruited lender sponsors, builders, and built a leadership event with esteemed speakers such as Fannie Mae, Freddie Mac, National MI, and realty brokers.
At the end of the day, we understand the members of NAIHBR chose real estate as their profession that results in families creating stability and wealth accumulation over time. If we take the approach of advancing local solutions, we can get to a national approach to addressing our housing shortage and meet the needs of families for generations to come.
”By doing good, we can all do well.
We look forward to working with each and everyone of you restoring economic strength in our communities. We look forward to sharing with you the many initiatives underway in the weeks to come.
Paul Imura
NAIHBR Chairman
