Friday, July 26, 2013

Congratuations to All Donors!

Congratulations to all Capital Campaign Donors... 

We have met the challenge donation goal! 


We recently received a $50,000 Challenge Donation to help retire the balance of the mortgage and complete the Changing Lives, Building A Legacy Capital Campaign.

This $50,000 Challenge Donation was to be awarded if we raised $50,000 to match this donation by July 31, 2013.

We have met the $50,000 Anonymous Challenge for the Burn the Mortgage Campaign!

All donors (of $1,000+) will be acknowledged on the donor wall in the lobby of the building. If you would still like to contribute to our education endowment, click here to donate online.

We look forward to seeing you on Saturday August 3, 2013 at our Burn the Mortgage Celebration, click here to RSVP.

Thursday, July 25, 2013

Setting the Record Straight on the Mortgage Interest Deduction

NAHB Press Release

WASHINGTON, July 25--As the Senate examines existing tax policies as part of its "blank slate" approach to tax reform, and as the House Ways and Means Committee continues its review of the tax code, it is appropriate to keep in mind the importance of the mortgage interest deduction (MID) as a middle-class tax provision that makes it possible for many families to achieve homeownership. It is also useful to review some of the claims against the MID to determine if those claims are valid. Economists at the National Association of Home Builders (NAHB) have analyzed data from the IRS and the Census Bureau, as well as estimates from other sources, to assess the validity of these claims.

Claim #1: The wealthy get most of the benefit from the mortgage interest deduction.

Fact: The majority of the tax benefits from the MID go to middle-class households. Data from the Congressional Joint Committee on Taxation shows that 86 percent of households who benefit from the mortgage interest deduction have incomes of less than $200,000. It is also useful to keep in mind that the majority of home owning households are married couples, so the household income measure will often include two incomes.

Claim #2: Repealing the mortgage interest deduction would not damage the economy or individual households.

Fact: Almost all studies examining the elimination of the mortgage interest deduction find that it would reduce demand for housing by raising taxes on prospective home buyers. This reduction in housing demand would also lower home values for existing home owners who would experience a significant loss in wealth.

A 1 percent decline in home prices would result in a loss of $185 billion to American households. Just a 6 percent decline would eliminate $1 trillion in household net worth. If repealing the deduction lowered prices by 10 percent or more, Americans would lose trillions of dollars in household net worth. If home values fall, then more families will find themselves under water, in default and in foreclosure. Eliminating the mortgage interest deduction would reduce the financial resources families can draw on for education, entrepreneurship and retirement. And if home values fall, then state and local tax revenues fall, making it harder to fund schools, infrastructure, public safety and other important government functions. Repealing the MID would have serious economic consequences.

Claim #3: Only a small percentage of home owners claim the mortgage interest deduction.

Fact: The mortgage interest deduction is broadly claimed. Seventy percent of home owners with a mortgage claim the MID in a given year, and almost all home owners benefit from the deduction at some point during their homeownership lifecycle.

The argument that only an estimated "quarter of taxpayers" claim the deduction is misleading because it ignores the lifecycle element of homeownership. Of the two-thirds of households who are home owners, one-third own free-and-clear with no mortgage. And of those with a mortgage who claim the standard deduction in lieu of the MID, many are in the final years of a mortgage and are paying small amounts of interest and greater amounts of principal. In the early years of their mortgage when much greater amounts went to interest, those home owners very likely claimed the mortgage interest deduction.

Claim #4: Repealing the mortgage interest deduction would make the tax code more progressive.

Fact: A progressive tax system is one in which taxpayers with lower incomes pay a smaller share of their earnings in taxes than higher income households. Repealing the mortgage interest deduction would result in larger tax hikes - as a share of household income - for the middle class. For example, for households with less than $200,000 in adjusted gross income (AGI), the typical mortgage interest deduction is worth 1.76 percent of that family's AGI. For taxpayers reporting more than $200,000 in income, the benefit falls to 1.5 percent of AGI. Thus, in the event of repeal, middle-class home owners face a larger tax hike as a share of their income, making the tax system less progressive.

Claim #5: The mortgage interest deduction incentivizes buyers to purchase a larger home.

Fact: While the mortgage interest deduction is sometimes connected with larger homes, evidence shows that it is more often the case that the tax benefit reflects family size and underlying housing demand. Larger families require a larger home, which in turn means a greater amount of mortgage interest paid and a larger tax benefit. And NAHB analysis of IRS data confirms this. Taxpayers with two personal exemptions (a measure of family size) who claimed the MID had an average tax benefit of $1,500. Taxpayers with four personal exemptions had an average benefit of approximately $1,950. In fact, the benefit increased correspondingly from one dependent to five-plus personal exemptions, which is consistent with the notion that larger families require larger homes.

Claim #6: Renters do not support the mortgage interest deduction.

Fact: Public opinion polling has generally found the MID to be popular with renters, most of whom hope to become home owners. Given that recent home buyers receive the greatest tax benefits from the deduction, such renters would have much to lose in case of repeal. A 2012 poll found that a majority of renters were opposed to eliminating the mortgage interest deduction.

Claim #7: Because mortgages on second homes also qualify for the mortgage interest deduction, taxpayers are subsidizing vacation homes for the wealthy.

Fact: The rules relating to second homes are complicated, and often apply to situations that do not involve a vacation home. The rule allows owners who sell their home and buy another - those who own more than one primary residence in a tax year - to claim the MID for both homes on their annual tax return. The rules also allow home owners who are building a new home to claim construction loan interest as a deduction.

And the rules support investment in seasonal residences that provide an economic foundation for many parts of the country. In fact, 49 states in the U.S. have at least one county where more than 10 percent of the housing stock fits the tax definition of a second home. But we are not talking about million-dollar homes on the beach, which are usually paid for in cash or claimed as rental property. According to an analysis of the Consumer Expenditure Survey, the average income of a household with a mortgage on a second home is $71,344.

Claim #8: While the mortgage interest deduction supports homeownership, federal policy neglects renters.

Fact: Housing policy support, in dollar terms, is roughly proportional to the total population living in renter- and owner-occupied homes. For example, the report of the Housing Commission of the Bipartisan Policy Center, which looked at all of the tax and spending programs for rentership and homeownership, found that about one-third of housing policy spending is attributable to rental housing, which is equal to the share of the population living in that form of housing. Such analysis is important because it shines a spotlight on important housing programs for affordable rental housing, including the Low-Income Housing Tax Credit (LIHTC).

Claim #9: Since not all home owners itemize, a credit would be better for the market.

Fact: Identifying winners and losers from moving from an itemized deduction to a credit depends on a number of factors, most importantly the tax credit rate. For example, the Simpson-Bowles report recommended a 12 percent tax credit, meaning a tax benefit of 12 cents for every dollar of qualified mortgage interest paid. A revenue-neutral tax credit would be approximately 20 percent. Thus, such a low rate as 12 percent would represent a significant tax hike for home owners. Moreover, it is important to remember that under most MID tax credit proposals, the property tax deduction (worth on average about one-third of the value of the MID) would cease to exist, further increasing the tax burden on home owners.

Claim #10: There is too much policy support for housing.

Fact: At the federal level, much of the focus on housing tax policy is centered on important and long-standing policies like the MID and the LIHTC, but this focus ignores the fact that home owners pay property taxes that are not collected on other forms of investment. For example, owners of owner-occupied and rental housing pay approximately $300 billion a year in property taxes to local and state governments. Such tax burdens should not be ignored in federal tax debates when considering the overall effective tax rate on housing.

Remodeler Confidence Rebounds in Second Quarter

NAHB Press Release

WASHINGTON, July 25 - Confidence in the remodeling market rebounded in the second quarter of 2013 with the Remodeling Market Index (RMI) rising six points to 55, according to the National Association of Home Builders (NAHB). The rise in existing home sales and increased demand for remodeling projects contributed to the positive report.

An RMI above 50 indicates that more remodelers report market activity is higher (compared to the prior quarter) than report it is lower. The overall RMI averages ratings of current remodeling activity with indicators of future remodeling activity.

"Remodelers are feeling optimistic about the home improvement market during what has turned out to be an uneven recovery," said NAHB Remodelers Chairman Bill Shaw, GMR, GMB, CGP, a remodeler from Houston. "The RMI future market results are especially promising. Not only do remodelers have projects booked for the next few months, but they also have more work coming in the door."

The future market indicators component of the RMI increased to 56 from the previous quarter level of 48. Current market conditions rose from 50 in the previous quarter to 54. All of the indicators of future activity (i.e. calls for bids, work committed for three months, backlog, and appointments) were over 50 for the first time in eight years.

"Remodelers' positive sentiment is directly related to increased demand for their services. Rising home prices are making remodeling jobs possible for more homeowners while existing home sales provide additional momentum as home owners prepare their homes for market," said NAHB Chief Economist David Crowe.
For more information about remodeling, visit

Wednesday, July 24, 2013

New-Home Sales Jump 8.3 Percent in June

NAHB Press Release

WASHINGTON, July 24 - Sales of newly built, single-family homes surged 8.3 percent to a seasonally adjusted, annual rate of 497,000 units in June, their fastest pace in the last five years, according to data released today by HUD and the U.S. Census Bureau.

"New-home buyers are returning to the market in larger numbers as firming prices, shrinking inventories of homes for sale and improving local economies convince them that now is the time to make their move," said Rick Judson, chairman of the National Association of Home Builders (NAHB) and a home builder from Charlotte, N.C. "Meanwhile, the very low supply of new homes on the market is indicative of the difficulty that builders are having in keeping up with demand due to availability issues with regard to materials, credit, labor and lots for development."

"The takeaway from this report is that the housing recovery is solidly on track and isn't going to be derailed by slightly higher mortgage rates," said NAHB Chief Economist David Crowe. "After years of fence-sitting, buyers are back and are ready to move forward with an investment in homeownership." Looking ahead, he said he anticipates further, though more incremental gains in sales through the end of this year.

Three out of four regions saw solid gains in new-home sales activity in June, with the Northeast, South and West posting increases of 18.5 percent, 10.9 percent and 13.8 percent, respectively. The Midwest posted an 11.8 percent decline following an above-trend bump in activity in May.

The inventory of new homes for sale declined to 161,000 units in June, marking a razor-thin, 3.9-month supply at the current sales pace. The months' supply of homes for sale has not fallen below this level since March of 2004.

Thursday, July 18, 2013

NAHB Seeks Changes to the PATH Act to Ensure a Healthy Housing Finance System

NAHB Press Release

WASHINGTON, July 18 - The National Association of Home Builders (NAHB) told Congress today that it will work with lawmakers to make changes to the Protecting American Taxpayers and Homeowners (PATH) Act legislative proposal to ensure that it provides the federal support necessary to maintain a strong and liquid housing finance system.

Testifying before the House Financial Services Committee, NAHB CEO Jerry Howard urged the committee to modify the PATH Act to make sure that the federal government continues to provide a backstop for a reliable and adequate flow of affordable housing credit in all economic and financial conditions.

"NAHB believes federal support is particularly important to ensure that 30-year, fixed-rate mortgages, the bedrock of the nation's housing finance system since the 1930s, remain available at reasonable interest rates and terms," said Howard. "As currently drafted, the PATH Act does not provide the federal support necessary to ensure a strong and liquid housing finance system, and we urge the committee to make the necessary changes."

There are some positive elements in the PATH Act, and NAHB agrees that private capital must be the dominant source of mortgage credit, Howard said. However, ensuring the safety and stability of the housing finance system cannot be left entirely to the private sector.

"The historical record clearly shows that the private sector is not capable of providing a consistent and adequate supply of housing credit without a federal backstop," he said.

NAHB has recommended to the committee that Fannie Mae and Freddie Mac be gradually phased into a private sector oriented system, where the federal government's role is explicit but its exposure is limited. Federal support would be limited to catastrophic situations where carefully calibrated levels of private capital and insurance reserves would be depleted before any public funds were employed to shore up the mortgage market.

NAHB also urged House lawmakers to modify the sections of the bill outlining changes to the Federal Housing Administration (FHA).

"The PATH Act would drastically diminish FHA's vital liquidity mission," said Howard. "By simultaneously leaving all federal support for housing to FHA, and then by greatly reducing the overall scope and reach of FHA's programs, the
PATH Act would greatly limit homeownership and rental housing opportunities for many financially responsible and qualified Americans."

Because there is currently a great deal of uncertainty among consumers and home builders due to the unresolved debate on reforming the housing finance system and the government sponsored enterprises, Howard urged the committee to move forward in a careful, prudent manner to provide needed assurance for the industry and consumers.

"At a time when housing is just starting to get back on its feet and provide job and economic growth, we don't want to do anything that would reverse this positive momentum," he said. "It's definitely important that Congress be mindful of housing's important role in the economy going forward."

"NAHB looks forward to working with lawmakers to create a sustainable housing finance system that will ensure stability and liquidity in the financial system that supports homeownership and rental housing," Howard added.

Wednesday, July 17, 2013

Highlights of Colliers 2Q 2013 Industrial Market Report

A couple of highlights, courtesy of William Froelich, Vice President | Hawaii Industrial Division Manager, Colliers International:

  1. Island wide vacancy rate is 3.15%, with projected vacancy under 3% by year end. (We have not seen this since 2007)
    1. Central Business district vacancy rate less then 2%.
    2. Average rental rate averages over $1.00 psf triple Net.
  2. Spec building is not supportable by the standard investor until rental rates rise another 30%.
    1. With no relief in site, we predict that will happen by more than 10% per year.
  3. Pressure on our industrial market as a result of general economic improvement, rail, housing boom in kakaako, tourism, and military spending will create raw land demand where there are availabilities. (out west)
 Download complete report here

Tax Code Rewrite Threatens Homeownership, Rental Housing, and Our Industry

Act NOW!

Write Your Senators at:

Tell Them:

It is critical that they preserve vital housing tax incentives like the mortgage interest deduction and the Low Income Housing Tax Credit to create jobs and keep the economic recovery moving forward.

What’s at Stake:

The Senate is considering revamping the tax code which could ELIMINATE SOME OR ALL HOUSING TAX INCENTIVES. This could harm the bottom line of all residential construction businesses, depress home values, impose a tax increase on home owners and cause massive layoffs in housing and other industries.


The Senate Finance Committee recently announced it will consider comprehensive tax reform and initiate proceedings with a blank slate: no exemptions, deductions, or credits. Our industry must pull together to defend the mortgage interest deduction and other critical housing tax incentives.

Many of the tax reform proposals have suggested eliminating or reducing the mortgage interest deduction, the Low Income Housing Tax Credit, the capital gains exclusion for home sales and the deduction of property taxes, among others. This would DEVASTATE OUR INDUSTRY by depressing home values, which would put countless more home owners underwater and trigger a new wave of foreclosures and layoffs in our industry.

Urge Your Senators to:

Preserve important housing incentives (the mortgage interest deduction, the Low Income Housing Tax Credit, the capital gains exclusion for home sales, and the deduction of property taxes) in the tax code.

How to Contact Your Senators:

Write them at

Act NOW!

Multifamily Dip Drives Housing Starts Lower in June

NAHB Press Release

WASHINGTON, July 17 - Nationwide housing starts declined 9.9 percent to a seasonally adjusted annual rate of 836,000 units in June as construction of multifamily buildings slowed following recent months of strong activity in that sector, according to newly released figures from HUD and the U.S. Census Bureau. Meanwhile, the pace of single-family production held fairly even, with a decline of less than one percentage point.

"While demand for new homes and apartments has grown considerably over the past year, builders are still being very careful not to get ahead of the market, and today's report reflects that cautious approach," said Rick Judson, Chairman of the National Association of Home Builders (NAHB) and a home builder from Charlotte, N.C.

"The large dip in multifamily production in June follows a boost of activity in May, and is consistent with the volatility that has come to characterize that sector as well as the uneven pace of the housing recovery," noted NAHB Chief Economist David Crowe. "That said, the fact that single-family starts and permits both rose in three out of four regions in June is a positive sign that's in keeping with our forecast as well as recent surveys in which single-family builders have registered an increasingly positive outlook."

The annualized rate of multifamily production declined 26.2 percent to 245,000 units in June after a 28.2 percent gain in the previous month. Meanwhile, single-family construction slipped by a marginal 0.8 percent to a 591,000-unit pace. Regionally, combined starts activity declined 12.1 percent in the Northeast, 7.4 percent in the Midwest, 12 percent in the South and 5.4 percent in the West in June.

Building permits, which are an indicator of future building activity, declined 7.5 percent to 911,000 units in June. This was due entirely to a pullback in the multifamily sector, where permits fell 21.4 percent to 287,000 units. Single-family permits registered a marginal 0.6 percent gain to 624,000 units - the best pace in five years.

Regionally, permit issuance was down 4.6 percent in the Midwest, 11.2 percent in the South and 7.2 percent in the West, but rose 5.9 percent in the Northeast in June.

Tuesday, July 16, 2013

Builder Confidence Rises Six Points in July

NAHB Press Release

WASHINGTON, July 16 - Builder confidence in the market for newly built, single-family homes rose six points to 57 on the National Association of Home Builders/Wells Fargo Housing Market Index (HMI) for July, released today. This is the index's third consecutive monthly gain and its strongest reading since January of 2006.

"Today's report is particularly encouraging in that it shows improvement in builder confidence across every region as well as solid gains in current sales conditions, traffic of prospective buyers and sales expectations for the next six months," noted NAHB Chairman Rick Judson, a home builder from Charlotte, N.C. However, he cautioned that "This positive momentum could be disrupted by threats on the policy side, particularly with regard to the mortgage interest deduction and federal support for the housing finance system."

"Builders are seeing more motivated buyers coming through their doors as the inventory of existing homes for sale continues to tighten," noted NAHB Chief Economist David Crowe. "Meanwhile, as the infrastructure that supplies home building returns, some previously skyrocketing building material costs have begun to soften."

Derived from a monthly survey that NAHB has been conducting for 25 years, the NAHB/Wells Fargo Housing Market Index gauges builder perceptions of current single-family home sales and sales expectations for the next six months as "good," "fair" or "poor." The survey also asks builders to rate traffic of prospective buyers as "high to very high," "average" or "low to very low." Scores from each component are then used to calculate a seasonally adjusted index where any number over 50 indicates that more builders view conditions as good than poor.

All three HMI components posted gains in July. The component gauging current sales conditions rose five points to 60 - its highest level since early 2006. Meanwhile, the component gauging sales expectations in the next six months gained seven points to 67 and the component gauging traffic of prospective buyers rose five points to 45 - marking the strongest readings for each since late 2005.

All four regions also posted gains in their HMI scores' three-month moving averages. The Northeast showed a four-point gain to 40 while the Midwest reported an eight-point gain to 54, the South posted a five-point gain to 50 and the West measured a three-point gain to 51.

Editor's Note: The NAHB/Wells Fargo Housing Market Index is strictly the product of NAHB Economics, and is not seen or influenced by any outside party prior to being released to the public. HMI tables can be found More information on housing statistics is also available at

Wednesday, July 10, 2013

$50,000 Anonymous Challenge - $10,700 to go!!

We recently received a $50,000 Challenge Donation to help retire the balance of the mortgage and complete the Changing Lives, Building A Legacy Capital Campaign.

This $50,000 Challenge Donation will be awarded if $50,000 is raised to match this donation by July 31, 2013.

We are committed to achieving our goal and would like to ask for your support to help meet this Challenge! Your contribution will help efforts to continue to sustain the valuable workforce in our industry and all contributors will be recognized permanently in the building lobby.

To date, we have raised $39,300 of the $50,000 needed to meet the anonymous challenge donation. 

We need $10,700 more to reach our goal!

Mahalo to our $50,000 Anonymous Challenge Donors to Date:

$5,000 - Cosco Properties, LLC
$5,000 - John Cheung, CC Engineering & Construction
$5,000 - J W, Inc.
$5,000 - Mike & Kim Brant (personal donation), Gentry Homes, Ltd.
$1,000 - Armstrong Foundation
$1,000 - Audrey Hidano, Hidano Construction
$1,000 - Brian Adachi, BKA Builders, Inc.
$1,000 - Bruce Barrett (personal donation)
$1,000 - Castle & Cooke Homes Hawaii
$1,000 - Clifton Crawford, C&J Contracting, Inc.
$1,000 - Dean Uchida (personal donation), SSFM International
$1,000 - Doug Pearson, Castle & Cooke Homes Hawaii
$1,000 - Dwight Mitsunaga (personal donation), DM Pacific, Inc.
$1,000 - Evan Fujimoto (personal donation), Graham Builders
$1,000 - Karen Nakamura (personal donation), BIA-Hawaii
$1,000 - Karin Holma (personal donation), Bays Lung Rose & Holma
$1,000 - Kokea Construction & Consultants, Inc.
$1,000 - Ryan Engle, Bays Lung Rose & Holma
$1,000 - Scotty Anderson (personal donation), Scotty Anderson Group
$1,000 - Steven Hidano, Hidano Construction
$500 - Barbara Nishikawa (personal donation), BIA-Hawaii
$500 - Greg Thielen, personal donation, Complete Construction Services Corp.
$500 - Craig & Dana Washofsky (personal donation), Servco
$500 - Michael & Rachel Watanabe (personal donation), J W, Inc.
$500 - Rons Construction
$500 - Sunrise Construction, Inc.
$500 - Universal Construction, Inc.
$200 - Clarice Watanabe (personal donation), BIA-Hawaii
$100 - Stacy DiPilato (personal donation), BIA-Hawaii
$100 - Sunny Walsh (personal donation, Hunt Building Co.

Koa Ridge is Moving Forward

From Castle & Cooke Homes Hawaii

Koa Ridge E-Newsletter - July 10, 2013

Today, the City & County of Honolulu Planning Commission unanimously approved Castle & Cooke's Koa Ridge project in Central Oahu. This approval allows us to move forward with the City rezoning process and brings us one step closer to delivering another quality master planned community for Hawaii.

At Castle & Cooke, we continue to believe that there is a great need for new housing choices, and Koa Ridge will provide homeownership opportunities, built by Hawaii workers, for Hawaii families. Koa Ridge will be a dynamic multi-generational, multi-cultural community - and we are excited to be moving forward with this project!

We would also like to say MAHALO to the many individuals and organizations that have supported Koa Ridge over the years, including our Visioning Team Members. We appreciate your commitment, dedication and collaboration and we look forward to continue working with you in the future.

The next step for Castle & Cooke is to present Koa Ridge to the full City Council, and we anticipate doing so within the next few months. If you would like more information or have questions on Koa Ridge, please visit our website or contact Laura Kodama via e-mail or at(808) 548-4825.


Castle & Cooke Hawaii

Monday, July 8, 2013

255 Metros Listed as Improving Housing Markets in July

NAHB Press Release

WASHINGTON, July 8 - A total of 255 metropolitan areas across 49 states and the District of Columbia qualified to be listed on the National Association of Home Builders/First American Improving Markets Index (IMI) for July, released today. This is down slightly from the 263 metros that made the list in June, but is more than triple the number of metros that were on it in July of 2012.

The IMI identifies metropolitan areas that have shown improvement from their respective troughs in housing permits, employment and house prices for at least six consecutive months. Six new markets were added to the list and 14 were dropped from it in July. Newcomers include the geographically diverse metros of Cumberland, Md.; Saginaw, Mich.; Farmington and Las Cruces, N.M.; Kingston, N.Y.; and Olympia, Wash.

"This is the sixth straight month in which at least 70 percent of all U.S. metros have qualified for the Improving Markets Index," observed NAHB Chairman Rick Judson. "The relative stability of the IMI is representative of the broad recovery underway, which is much more extensive than what we were looking at one year ago."

"Despite slight ups and downs in recent IMI levels, an overwhelming majority of U.S. metros -- including those located in almost every state -- remain solidly on the path to recovery even as the pace of their improvement is slowed by ongoing challenges related to the availability of credit, labor, lots and certain building materials," added NAHB Chief Economist David Crowe. "Based on recent trends in home prices, housing permits and employment, the outlook for a continued housing expansion remains very positive for the remainder of 2013."

"The fact that more than two-thirds of all U.S. housing markets continue to be represented on the improving list should be a boon to consumer confidence at a time when many are looking to take advantage of today's very favorable mortgage rates," observed Kurt Pfotenhauer, vice chairman of First American Title Insurance Company.

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 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 measures for at least six consecutive months following those measures' respective troughs before being included on the improving markets list.

A complete list of all 255 metros currently on the IMI, and separate breakouts of metros newly added to or dropped from the list in July, is available at