New HBAI president grew up around the trades
Keith Butz takes his new role as the president of the Home Builders Association of Iowa very seriously. He sees it as a way to give back to an industry that has given him so much, and because of that, he wants to make sure the needs of his constituency are not forgotten during this year’s legislative session. What does your new position entail? Our state association has about 2,500 members all across Iowa. I become their spokesperson and leader in regard to how the homebuilding industry functions within the state. One of the biggest things the association does is watching and lobbying state government.
Why is this something you wanted to get involved with?
I’ve been in the business for almost 20 years.This is a way to give back to an industry that has been good to me. We’re a heavily regulated industry.With all the building codes, there’s a lot that goes into it, a lot of government oversight. I enjoy being able to learn the concerns of our members and working to alleviate those concerns.
What are the main goals you hope to accomplish as president?
My goal this year is to get our members to realize and understand that it’s the grassroots effort of getting to know who your city council representatives are, who your planning and zoning people are and who your building inspectors are. Then you have to develop a relationship with those people. That makes our lives easier because those are the people that make the decisions that affect our industry and can make it more costly to produce housing. Basically, for every $1,000 increase in the price of a home, across the United States it pushes 300,000 people out of the market.You don’t think a $1,000 increase is that much, but it can keep people from realizing the American dream of home ownership.
Do you have any fears that the housing bubble is about to burst?
I’m not worried. Obviously, from 2003 to 2005 we had an extraordinary market, where the pace of building and consumer purchasing of homes was at an all-time high. It’s something we knew was not going to be a sustainable rate.What we’re seeing now is not a bursting of a bubble; it’s getting back to normal, a correction in the marketplace. But interest rates are still extremely favorable. Six percent on a 30-year mortgage is cheap.When I first started in the business we had 12 percent rates and we thought that was great.We’ve got a little too much inventory right now, but I think by midsummer you’ll see that get cleaned up and the market will get back to a more normal pace.
So you enjoyed it while it lasted, but you knew it couldn’t last forever?
When you get to the pinnacle of the roller coaster, it’s really breathtaking. But sooner or later you’ve got to come back down to reality. You can’t sustain that growth forever.We had a lot of builders who were selling units about as fast as they could and they just put a little too much inventory in front of the public. When the brakes came on, instead of being able to sell your units before they’re finished, now you might sit on them for six, eight, 10 months after they’re completed. And even though new construction has slowed down a lot, our remodelers are extremely busy. I think instead of purchasing a new home, many people have decided to instead stay where they are and make changes to their existing home.
How did you get into this business?
I grew up around the trades. My dad was in the structural steel business. I had an uncle who was an electrical contractor and two others who were carpenters.That’s how I spent my summers growing up. I had a hobby of doing things myself at home, and friends started asking me to help them with projects. Eventually, a friend of mine and I got the brilliant idea to start doing remodeling work.
What was your worst job?
I worked one summer for a roofing contractor scraping the old shingles off roofs. It was hot and miserable.
What is the best advice you’ve been given?
To treat people the way you’d like to be treated yourself.Treat them with dignity and respect. And be honest. It’s extremely important to deal with people in our business that way.
Did you build your current home?
No, the house I’m in right now is one that I’ve completely remodeled. I’ve gutted every room, and there are still projects ongoing. It’s an older home in Windsor Heights, and we just want the inside of it not to look like a 50-year-old house.