In a major victory for NAHB’s members and property rights advocates, the U.S. Supreme Court on June 25 issued an opinion that gives property owners ammunition to fight certain concessions that are often required as a condition for approving a permit to develop a piece of land. This excellent outcome overturns a Florida Supreme Court ruling that would have given governments expanded power to force unreasonable exactions upon developers, and your national association’s involvement helped make it happen.
- NAHB Involvement
Leading the fight on behalf of property owners and acting to ensure that the interests of NAHB members were appropriately represented, NAHB headed a coalition of 16 prominent real estate and business organizations in filing an amicus brief with the Supreme Court in which we explained why it is neither necessary nor fair for governments to extort money from property owners who wish to use their land. This meant that through NAHB efforts, organizations representing more than 70% of the U.S. GDP weighed in on the case. Our influence also went beyond the amicus, because out of 38 cases that the Supreme Court cited in its Koontz decision, 10 of those were cases in which NAHB was involved. This kind of participation is what it takes to establish positive legal precedent, and it’s further proof of the value proposition of your NAHB membership.
- The Ruling
Since the late 1980s, a permit condition has not been considered constitutional unless it has a “nexus” to a governmental purpose and it is “roughly proportional” to the impacts of the project. This is known as the Nollan/Dolan test, named after two Supreme Court cases. The test protects property owners from over-zealous land use permitting officials, but until now there were two outstanding questions about it — namely, 1) does it apply even if the permit is denied, and 2) does it apply if the government’s condition is a payment of money? In both instances, the Supreme Court answered in the affirmative. So in the first scenario, if a property owner refuses to agree to outrageous conditions in a permit and the government subsequently denies that permit, the government cannot later argue that there was no constitutional violation because the permit was never granted. The Supreme Court also ruled that the Nollan/Dolan test applies equally whether the government demands that the land owner give up real property or money as a condition of obtaining a permit. Tellingly, the court used a form of the word “extortion” five times to describe the manner in which governments demand property from developers before granting approvals.
This landmark Supreme Court decision effectively denies the government the ability to force unreasonable exactions upon developers in exchange for a permit approval, and it means that federal, state, and local regulators will need to exercise more caution to ensure that permitting demands – including monetary demands – are proportionate to the project at hand. The bottom line is that this is an outstanding victory that will help our members for years to come. NAHB’s legal team has put together a quick synopsis of the case and distributed it to HBA executive officers so that they can help spread the good news.
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At the NAHB Board of Directors meeting last week, the association unveiled an important new member benefit for builders, developers and others who want to know more about the U.S. Fish and Wildlife Service’s plans to step up the “listing” process for endangered and threatened plants and animals under the Endangered Species Act (ESA). The interactive species finder map allows members to search by state and county to determine the status of the more than 1,400 species currently protected by the ESA as well as the status of 700 additional species whose listings are now in the planning stages. The NAHB Environmental Issues Committee touts this new member benefit as an “early warning system” for builders who might want to reconsider how to develop a specific property or whether to even purchase it based on its likelihood of being designated as an endangered animal’s critical habitat. State and local home builders associations may also find it helpful to know what listings are in the works for their market areas so that they can begin putting resources together for comment letters and other tools to address proposed listings and habitat designations. Importantly, the new map tool also includes a set of Frequently Asked Questions designed to explain how the ESA works and explain some of the related terminology.
A newly published special study on HousingEconomics.com addresses the question of what the appropriate rate of return should be for judging the cost effectiveness of a particular energy-saving feature in a home. While NAHB has a policy that classifies a change in building codes as cost effective if it returns at least 10% in energy savings in the first year, other approaches — for example, those pegged to the current rate on a fixed-rate mortgage — assume a much smaller rate of return will do. NAHB’s economists argue that the common practice of using the current mortgage rate to discount energy savings is unrealistic, fails to account for buyers’ borrowing constraints and doesn’t reflect the way that consumers actually evaluate alternatives when deciding on which features to include in a new house. The article presents evidence from three different sources about rates of return that more realistically reflect household decision alternatives, all of which are in the same neighborhood as (though slightly higher than) the 10% return in NAHB’s current policy. Meanwhile, it argues that the current mortgage rate of 4% is far too low of a benchmark against which to compare utility savings because doing so will result in some features being classified as cost-effective that are clearly priced higher than the market will bear. While NAHB surveys have shown that most home buyers do care about energy efficiency and are very interested in features of the home that can lower utility bills, home buyers on average say they need to save 14% of the upfront cost per year to make an investment in energy efficiency. This aligns with survey responses indicating that consumers are willing to pay about $7,100 up front to save $1,000 annually in utility costs. The study therefore concludes that the right rate of return to use when trying to judge the cost effectiveness of a particular energy-saving feature needs to be in the 11% and higher range if it is to accurately reflect housing market behavior — very near to what is dictated by NAHB’s policy on Cost-Effective and Affordable Energy Codes and Standards.
Choose from more than 400 house plan designs that we offer in a wide range of styles and sizes. Some of our more popular house designs include European-inspired Georgian and palladian homes, English manor house plans, Tuscan-style Italian villas, French chateaux, and colonial house plans. Our Tuscan-style villas range from 1800 to 14,814 sf, and Newport classic house designs range from 1500 to 5000 sf. Our starter castles, mansions and estate homes are designed in the grand tradition of some of the most impressive homes in the world. Please feel free to search our house designs offered. Our plans have been built around the globe, from Canada to Dubai, and one could be just for you!
Soaring production of multifamily apartments pushed nationwide housing starts beyond the million-unit mark for the first time since 2008 in March, according to government data released April 16. While single-family production slipped 4.8% to a seasonally adjusted annual rate of 619,000 units, a 31.1% gain to 417,000 units on the multifamily side provided the boost needed to raise the overall production pace by 7% to 1.036 million units. Importantly, the decline on the single-family side was entirely due to a substantial upward revision to the previous month’s data, without which virtually no change would have been recorded this time around. Meanwhile, the pace of multifamily production was the best seen since January of 2006.
Three out of four regions posted gains in combined single- and multifamily housing production in March, with the Midwest registering a 9.6% increase, the South posting a 10.9% gain and the West noting a 2.7% rise. The Northeast was the lone exception to the rule, with a 5.8% decline. Meanwhile, permit issuance for all new housing units fell 3.9% to a 902,000-unit rate in March after recording a big gain in the previous month. That decline reflected a 0.5% reduction to 595,000 units on the single-family side and a 10% reduction to 307,000 units on the multifamily side. In contrast to the regional starts report, the Northeast was the only part of the country to post a gain in permitting activity in March, with a 24.7% increase. The Midwest, South and West posted declines of 2.1%, 6.2% and 10.4%, respectively.
Calling the latest data a “mixed bag” due to the opposite direction of single- and multifamily starts and the somewhat weaker permit issuance, NAHB Chief Economist David Crowe said the numbers still indicate “a continuation of the slow, methodical march forward” that characterizes the housing recovery. He also noted that “The three-month moving average for single-family starts remained unchanged at 628,000 units in March – which is right on pace with NAHB’s forecast for a 25% gain in new-home production in 2013.”
DOE Rescinds May 1 Compliance Deadline for Gas Furnace Standard
NAHB has received several member inquiries regarding the compliance date for amended energy conservation standards that apply to residential furnaces. The new standards for non-weatherized gas furnaces, which were proposed by the Department of Energy (DOE) in mid-2011, were scheduled to be in effect as of May 1, 2013, but a lawsuit brought by the American Public Gas Association challenged the stricter energy consumption rules for those appliances in the northern region of the United States. That lawsuit led to a settlement agreement this January that would vacate the energy conservation standards applicable to non-weatherized gas furnaces within the DOE’s final rule. While the settlement must still be finalized, in the meantime the DOE this month issued a statement that it will not be enforcing the new standards unless or until the court rejects the joint agreement that is expected to remand them.
Bottom line for NAHB members: The May 1, 2013 compliance date for non-weatherized gas furnaces WILL NOT be enforced by DOE pending final settlement of the litigation between DOE and the American Public Gas Association.
Choose from more than 400 house plan designs that we offer in a wide range of styles and sizes. Some of our more popular house designs include European-inspired Georgian and palladian homes, English manor house plans, tuscan-style Italian villas, French chateaaux, and colonial house plans. Our Tuscan-style villas range from 1800 sf to 14,814 sf. Our Newport classic house designs range from 1500 to 5000 sf. Our starter castles, mansions and estate homes are desgned in the grand tradition of some of the most impressive homes. in the world. Please feel free to search our house designs offered. Our plans have been built around the globe, from Canada to Dubai, and one could be just for you!
Today’s photos are those of Archival Designs’ Luxury House Plan, Little Stone Pond, “Salem”