West Florida Builder Looks to Future, Optimistic About Housing Market

West Calhoun, the new president of the Home Builders Association of West Florida, is a Pensacola native who started out in the construction trade working summers for local contractors. He took the time to answer questions about the housing market and his plans for his year-long term with the Pensacola News-Journal. Here’s the interview:

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Q: What are the biggest challenges facing home builders in 2007, and what are they doing as a group to address them?

A: There are many, including property insurance, growth management, affordable housing, workers’ compensation, construction education and environmental permitting, just to name a few. Each of these issues are complex but equally important for the overall success of the housing market.

For instance, builders must have property casualty insurance coverage in order to build homes - Florida mortgage lenders require coverage for construction loans. This coverage must be available and affordable in order to do business.

As for growth management, local and state governments regulate residential development and home building through a myriad of rules and regulations designed to protect current residents, the environment, and the health and safety of new home buyers.

Q: Will 2007’s home building numbers approach those of pre-Ivan? And are you envisioning 2007 as a “comeback” year?

A: I am optimistic about the future. I cannot say whether or not this will be a comeback year, but I do believe that homes have been selling in our market if they are priced right.

Lately there have been a lot of calls and usually sales follow calls, so I am hopeful that people will take advantage of the market right now, because it’s still a good time to buy a home.

Q: Is the supply of labor sufficient to meet home builder needs during 2007?

A: Finding skilled labor is always tough in some cases, but I would say that builders are finding that the subcontractor labor force is able and willing to work.

To help meet Florida’s need for a more qualified workforce, the Home Builders Association of West Florida is pleased that Navarre High School has started a Future Builders of America program that is educating high-school students with important skills and industry knowledge.

Q: Do you see the use of incentives as more or less important in stimulating home sales going forward?

A: Incentives are good, but sometimes people will wait take a wait-and-see approach before buying. They will shop one builder to see what incentives and then go to another builder, and so on.

At the end of the day, the buyer is afraid to buy because they don’t want the feeling that they missed out on a better deal. It is human nature to get the best deal possible on their Florida mortgage loan and on the house itself.

I would encourage anyone to make an educated decision. However, it could cause paralysis by analysis, if you will, in the market.

Q: What effect have the crises involving insurance and property taxes had on new home sales?

A: Taxes and insurance definitely affect home sales by increasing the monthly Florida home mortgage payment. Hopefully the folks up in Tallahassee have made some positive changes recently that will lower insurance costs.

Q: What are your goals as 2007 president of the association?

A: I am proud of the work the HBA has done to keep our members informed, and frankly, keep them in business. We are proud of our governmental affairs program that continues to work to provide safe, affordable housing and the opportunity for home ownership for people in our community.

Regulatory fees are hard costs that are passed along to the buyer. The unintended consequence is that, because of the cumulative affect of each regulation, the price increases, thus reducing the affordability of homes.