By TODD BOOZE
(Editor's note: This column is reprinted from the Fall 2014 edition of Oklahoma Builder magazine)
As we approach the final quarter of the year, the housing market has seen modest growth across the state at approximately 4 percent. While the OKC metro area appears to be down about 9 percent, the reality is that we are about flat compared to 2013. This is understandable, when you consider the artificial bump in permits last year from the devastating impacts from the May tornadoes.
All other housing indicators still appear to be strong with inventory levels remaining low and monthly supply of homes in most markets below three months. We should see another positive year in 2015 in home building due to Sales to List price holding strong above 98 percent and the relatively low number of days on the market for most price ranges. This despite nationally and locally we are a little behind 2014 projections. This steady growth is much healthier for our industry than the wild spikes the nation has seen in the past.
Speaking of the Legislature
At the state level, this year's legislative session was relatively quiet for our industry. However, next year looks like we could have some really hot issues related to tax credits and builder licensing or registration. Earlier in August, there was a study session with legislators and the industry to discuss the possibility of introducing legislation next year regarding this issue. With the tremendous amount of feedback we received from surveys of our membership, I believe we represented our industry's view regarding this possibility. I want to thank our newly appointed Legislative Chairman, Jeff Click, for his presentation to the Legislators on how legislation would have to be crafted to gain our industry's support. We look forward to working toward a solution to this next year as the session begins in February.
Building Summit 2015 to Be Even Bigger!
Scott Sedam works the audience during afternoon keynote at 2014 Building Summit.
This month, OSHBA held its Sixth Annual Building Summit and, based off the registration feedback, this proved to be the best one yet!
The Building Summit has become our industry's most beneficial training event offered. Under the leadership of Phil Rhees, Vice President/Treasurer and Kurt Dinnes Vice President/Secretary we have some exciting changes coming next year to propel this into becoming an even greater value to our members and replace some of the social and networking opportunities missed by the elimination of the summer convention, so stay tuned!
For those of you that missed it, our Keynote Speaker Scott Sedam is on a mission to eliminate waste in the construction process, otherwise known as a Lean philosophy. Sedam challenged our industry to have a paradigm shift in how we operate with our Trade and Supplier base. One of the largest challenges we will have as an industry as the market continues to recover is an adequate and trained trade base to construct the houses.
The challenge to us builders is to move from the old traditional mindset of win-lose with our trades to more of a true partnership with our trades to become more efficient and productive on our jobs. Builders are the Conductor of the orchestra on the job sites and Builders are the ones who can create an environment of success for all Trades and Suppliers that step foot on that site.
The industry is concerned about shortage of qualified labor and, while that is true, Builders can do a lot to help with the current production capacity of the Trades we have now. Scott Sedam has worked with many Builders and Trades across the country and he estimates the current Trade base operates at about 65 percent of its production level due to inefficiencies built into the processes. I can assure all of you that those Builders who embrace this LEAN Philosophy won't experience a Trade shortage and you will have the Best of the Best wanting to be on your jobs.
For those of you that question this process, just take a look back at the Auto Industry over the last 20 years and see how American manufacturing had to make radical changes to compete with the Japanese manufacturers who embraced this philosophy long ago.
We are manufacturers, albeit not in such a controlled environment, but we are, and we need to think like other industries that have learned to revamp that process to remain competitive.
The next big initiative OSHBA had on its radar to address was the review and adoption of the 2015 IRC, However, due to delays in the release of the new code, the Oklahoma Uniform Building Code Commission decided to move the commercial (IBC) in front of IRC this year for review and adoption. Due to this, we have delayed the internal review until this fall.
By now I'm sure you have received emails from OSHBA requesting volunteers to sit on a review committee directed by our OUBCC Commissioner Curtis McCarty. We hope to have eight to 10 code knowledgeable and technical experts to review each chapter of the 2015 IRC so we can formulate our plan once the Technical Committee begins their process in early 2016.
Our plan is to identify cumbersome requirements that provide no value to the home and modify or eliminate them entirely.
We will have a template to work from as NAHB has done much analysis on the negative impacts of the code. But, we must identify those items that are crucial to the environment in Oklahoma and how we build.
Your participation in the process is crucial and we must remain diligent to keep out unnecessary prescriptive requirements that drive up the cost of housing in Oklahoma as this will have long lasting impacts on the type of housing we are able to provide. So if you know someone in your Local who is particularly knowledgeable in this area, please encourage him/her to contact the State Office and sign up for the committee.
As always, it is a pleasure to serve our membership and our industry and if there is anything we can do to help, please don't hesitate to contact us.