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Fed won’t raise rates yet, but hike could come later this year

Fed won’t raise rates yet, but hike could come later this year

by Ryan Smith | Apr 29, 2015

The Federal Reserve’s soft outlook on rate hikes today means business as usual in the mortgage bond market, according to Bryan McNee, vice president and senior bond analyst for

The Fed today said that with the housing recovery remaining slow and inflation running below its long-term objective, its current 0-one-quarter-percent target range for federal interest rates was still appropriate.

“The Committee anticipates that it will be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2 percent objective over the medium term,” the Fed’s Open Market Committee wrote in a press release.

McNee said that the Fed will probably still raise rates sometime this year.

“The bond market already says the Fed is going to raise interest rates this year. It’s the people in the stock market who don’t think rates are going to rise,” McNee said. “But the bond market has very clearly got a bet that we’re going to see something around September.”

The Fed didn’t specify when rates would rise, however, meaning most bond traders will continue to prepare for a rate hike, McNee said. And since that rate hike is expected, it won’t have a catastrophic effect on mortgage rates.

“It’s not going to be a crazy shift if they do it, because some of it is already in pricing,” McNee said. “There’s no doomsday scenario here. Worst case scenario, it would cause us to move off of some of the best rates we’ve seen this year.”

The Fed’s soft stance on rates may not have come as a surprise to bond traders, but many took precautions prior to the agency’s statement, selling off mortgage-backed securities Monday and Tuesday in anticipation of a more hawkish stance.

“Yesterday, Fannie Mae mortgage-backed security benchmark coupons sold off 49 basis points,” McNee said. That’s a pretty big move lower.”

It’s especially unusual considering the relatively weak recent economic reports, he said.

“Rates usually get a little better on a weak economic basis. But the mortgage-backed securities market shrugged (the reports) off and lost almost 50 points. Mortgage-backed securities traders were taking some money out of the game because they were nervous about the Fed meeting.”

West Michigan home builders struggle with a labor shortage

WYOMING, MI – West Michigan home builders say they need more workers as life returns to an industry that was on the ropes just five years ago.

But finding young people who are willing to put in a hard day’s work on a job site is no easy task, according to members of a “Next Generation Committee” formed by the Home Builders Association of Greater Grand Rapids.

High school counselors are pushing students into college and at the college level, kids are not signing up for programs designed to put them in the construction industry, according to committee members who gathered on Tuesday, Oct. 8.

“We have the programs, but nobody’s going through the training,” said Duane McIntyre, a construction instructor at Grand Rapids Community College, where only five students have enrolled in the school’s residential construction program.

Meanwhile, building trades programs in local high schools are “a thing of the past,” said McIntyre.

John Bitely, president of Sable Homes, said high school guidance counselors are pushing students into college programs to meet “No Kid Left Behind” goals while he’s trying to find carpenters and laborers to fill his construction crews.

“If we do have someone who has drive and ambition, they’re told not to get into our industry. Some of these kids need to see that there are good positions out there,” said Bitely, who said his lead carpenters are paid $35 an hour.

Bitely said the home building industry faltered in its recruitment programs in recent years because the jobs were not available. “We’ve been in survival mode,” he said.

Dave VanBaren, president of Great Lakes Superior Walls of Hamilton, said his company has problems finding young people willing to work. “Basically, we say if you show up every day, you can move up in the company,” he said.

Ryan Nettesheim, a youth services coordinator for Bethany Christian Services, said they preach the same “just show up every day” lesson in their “Youth Build” program.

Nettesheim’s seven-month program helps low-income students between 18 and 24 earn their Graduate Equivalency Degree (GED) and gain construction skills while working on Habitat for Humanity homebuilding projects.

McIntyre said many of the students he sees have not been taught the importance of showing up for work every day at home.

“There’s definitely a work ethic problem out there,” McIntyre said. “If you want to find a root cause, it comes down to family.”

Jim Harger

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Neighborhood to be housed on former site of Sparta’s Central School

Rockford based Sable Homes will break ground on a new neighborhood in the Village of Sparta, Central Town Square. The neighborhood, which is located in downtown Sparta near the intersections of North Union and Grove, and North Union and Alma, will feature 20 homes. According to the National Association of Home Builders’ statistics, the construction project will create more than 60 jobs in the Village of Sparta. The site of the project previously housed Sparta’s Central School, hence the name, Central Town Square.

Media is invited to attend the groundbreaking. John Bitely, president of Sable Homes, Martin Super, manager of the Village of Sparta, and Gordie Nelson, superintendent of Sparta Area Schools, will all be available for interviews.

Where: Sable Homes’ Central Town Square Housing Neighborhood
On Grove Street, Sparta, Mich. 49345

When: 10 a.m., Oct. 2, 2013

Who: John Bitely, president, Sable Homes
Martin Super, village manager, Sparta
Gordie Nelson, superintendent, Sparta Area Schools
Elizabeth Morse, DDA/Chamber director
Gary Hall, mortgage sales manager, Choice One Bank

Sable Homes to build 20 new homes to help spur Sparta’s economy

The community named the Sparta development ‘Central Town Square’ through social media polling.

SPARTA, Mich. – Rockford-based Sable Homes announced Thursday that construction on their newest development will begin in late September.

The land, located in the Village of Sparta near the intersection of North State and East Division, will feature 20 homes, along with a new model and housing design center which will help continue the economic growth in downtown Sparta.

“Recently, Sparta has seen substantial growth in the residential, commercial and industrial sectors,” said John Bitely, president of Sable Homes. “We want to help stimulate this growth by bringing families downtown and boosting the village economy.”

Sable Homes reached out to the community via Facebook and Twitter to solicit help naming its new development opening in downtown Sparta. After nearly a month of followers submitting ideas and voting for their favorite by “liking” other suggestions, the development was coined “Central Town Square.”

“By involving the community in the naming of this property, we’re able to help ensure this development reflects their spirit,” said Bitely. “We encouraged the community to suggest names that tied back into the former school as a way to preserve its memory and harken back to a place that played a profound role in the lives of many residents.”

The name Central Town Square provides a nostalgic connection to Sparta’s former Central School which once sat on the site of the development property. Other suggested names included, “Academy Square“, “Sable Central“, “Old School Center” and “Central Square.”

“We value infill in the village to achieve greater economies of scale for our services and in the end save tax payers money,” said Martin Super, Sparta Village Manager. “It’s a testament to our progress that Sable is investing here by building 20 new, quality homes right in downtown. This project will help facilitate our continued growth.”

Sable will begin the development with three homes and base the speed of construction for the rest of the development on the time it takes the homes to sell.

Sable Homes builds out foreclosed development

July 31, 2013| By David Czurak

Sable Homes has opened a new model home and design center as part of its plan to complete a foreclosed residential development northeast of Grand Rapids.

The Stone Crest development in Courtland Township is just west of 11 Mile Road and Young Street and not far from downtown Rockford.

It’s also one of a few new residential developments in the Rockford Public Schools District.

Sable Homes recently purchased the unfinished development out of foreclosure and began construction on new homes in June 2013.

“We’re excited that Sable Homes came in and picked up where the Stone Crest development project had stalled a few years back,” said Courtland Township Supervisor Chuck Porter. “We’re happy to welcome in our new neighbors and turn this development into the beautiful neighborhood it was meant to be.”

Porter said the partially built development will consist of 30 additional homes once it’s complete.

View Larger Map

The new Stone Crest model home is in Courtland Township, at 9309 Stone View Dr.

“Though the new model home in Stone Crest was built to enhance the sales experience in Stone Crest, it most certainly will be used by Sable’s staff to show what a fully furnished home will look like regardless of where the customer chooses to build their new home,” said Ron Austin, general manager, Sable Homes.

Sable Homes has priced the new Stone Crest homes from $180,000 to $260,000, depending on the lot and floor plan that are chosen.

Sable’s corporate sales and design center is located in Rockford, at 11575 Edgerton Ave.

Green space

Sable Homes President John Bitely made a $10,000 contribution to the Stone Crest Homeowners Association, which will use the money to finish a green-space project in the housing development the homebuilder is completing.

Bitely said his firm made the donation, in part, as an effort to be a good neighbor to those who already live in Stone Crest.

“And that is one of the reasons we are contributing to the green-space project and assisting with its completion. The project will surely benefit all individuals living in this neighborhood for years to come,” he said.

“It’s a great contribution in our efforts to promote a healthy environment and a beautiful place to live here in Courtland Township,” said Matt Wilson, vice president of the Stone Crest Homeowners Association.

Sable Homes also is building new public roads throughout Stone Crest and recently finished a one-mile stretch that the firm turned over to the Kent County Road Commission.

Sable Homes in Caledonia

Separately, Sable Homes donated $100,000 to Caledonia Community Public Schools in July.

The school system will use those dollars to improve access to its new athletic field.

The firm is building the Scotsmoor II housing development, which will have 51 new homes when finished, in Caledonia.

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Sable Homes and Caledonia school district score deal

July 3, 2013 | By David Czurak | Grand Rapids Business Journal

Sable Homes of Grand Rapids has made a donation to Caledonia Community Schools that has saved the public school district $100,000.

Sable Homes is building its Scotsmoor II Housing Development in Caledonia, and the firm had recently purchased a piece of land out of foreclosure that it originally intended to add to the development.

Ralph E. Meyers Football Stadium

But Caledonia High School needed some property to service and provide access to its new Ralph E. Meyers Football Stadium.

So Sable Homes President John Bitely met with Caledonia Superintendent Randy Rodriguez to discuss the district’s property needs.

After a series of discussions, Bitely granted the school district a permanent easement across the firm’s recently acquired property, and Rodriguez noted the action saved the school district $100,000.

“We are thankful for the agreement that Sable Homes and John Bitely offered to Caledonia Community Schools. Bitely was willing to work with us, and he identified a solution that allowed the district to save money, while at the same time fulfilled the district’s need for service access to our beautiful stadium,” Rodriguez said.

In return, the school district granted Sable Homes the necessary easements for Scotsmoor II.

“It’s great that we are able to save the school district $100,000, while beginning what is shaping up to be a long-lasting relationship here in Caledonia,” said Bitely.

Bitely and Rodriguez signed the agreement when Sable opened its Scotsmoor II model home and housing design center in Caledonia Township.

Scotsmoor II

When completed, Scotsmoor II will offer 51 new homes, with prices expected to start at $164,500 for a three bedroom, two-bath home with 1,975 square feet of space.


Sable Homes features new health-conscious technologies in one of their two homes to be displayed in the Parade of Homes.

ROCKFORD, Mich., May 20, 2013 – Sable Homes (Sable) will unveil one of West Michigan’s first “Healthier Homes” at the 2013 Grand Rapids Spring Parade of Homes. The 2,242-square-foot home is located at 9309 Stone View Drive and is part of Sable’s Stone Crest development in Rockford.

The home is the first of its kind in West Michigan to feature AirRenew gypsum board walls, which enhance the air quality by permanently reducing volatile organic compounds (VOCs) such as formaldehyde. AirRenew converts VOCs into safe inert compounds. AirRenew walls continue purifying the air for 75 years. In addition to VOC reduction, the walls also provide enhanced moisture and mold resistance.

The home also contains Sherwin-Williams no VOC paint and primer. Sherwin-Williams’ Harmony Zero VOC paint and Promar 200 Zero VOC primer are water-based acrylic (latex), which assists in keeping the AirRenew gypsum board permeable to better absorb the moisture and air compounds properly.

“Energy efficiency and healthy living are always front of mind for us,” said John Bitely, president of Sable Homes. “We take pride in using the safest materials for living and the best products to preserve our environment.”

Along with the Stone Crest “Healthier Home,” Sable will also feature a second home in the Spring Parade of Homes in the Scotsmoor II development, at 9552 Scotsmoor Drive, in Caledonia Township. The Parade of Homes runs May 24 through June 8.

About Sable Homes
Combining affordability with craftsmanship, Sable Homes has been building high-quality, energy-efficient homes for West Michigan families since 1996. For more information about our communities, visit our web page,, or follow us on Facebook.

Truck sales, housing recovery boost Detroit carmakers in April

Detroit’s automakers were the big winners in April sales as a recovering housing market and easy credit sparked a surge in demand for new pickups and allowed all three domestic manufacturers to gain share.

Their success in April makes the first four months of 2013 the best year-opener since the start of the sport utility vehicle craze two decades ago. Year-to-date, Detroit’s automakers have sold 10.5 percent more cars and trucks than they had by the end of April last year, and their combined share of the market has increased from 44.7 percent to 46.2 percent.

Overall industry sales were up 8.5 percent as automakers sold 1,285,338 cars and trucks, up from 1,184,509 last April. But full-size pickup sales were up a whopping 27 percent on volume of 153,356 vehicles.

“The housing sector recovery is in full swing,” said Jenny Lin, Ford Motor Co.’s senior U.S. economist, in a conference call Wednesday. “We’re seeing continued strength of full-size pickup sales, particularly supported by the housing recovery and also the boom in the energy sector.”

Ford’s F-Series remains the best-selling vehicle in the United States, with sales up 24.4 percent. That helped the Dearborn automaker post the biggest gain among the domestic manufacturers. Ford’s sales were up 18 percent on volume of 211,984 vehicles. Ford’s share of the U.S. market grew to 16.5 percent from 15.2 percent in April 2012.

And Ford sales analyst Erich Merkle said much of that overall gain came in highly competitive parts of the country, such as California and Florida.

“The growth came predominately from the West and the Southeast,” he said. “The Western market was up 35 percent, and the Southeast was up about 28 percent.”

General Motors Co.’s sales increased 11.4 percent in April as the automaker sold 237,646 cars and trucks. GM’s market share increased to 18.5 percent from 18 percent a year ago.

“When credit is available and favorable, the job market is stable, incomes and household wealth are increasing, good things happen in the auto sector,” said Kurt McNeil, vice president of U.S. sales operations, in a call with analysts and reporters.

GM’s trucks did well in April, as did new vehicles such as the Cadillac ATS and XTS sedans.

Led by surging demand for its Ram pickups, Chrysler Group LLC reported its 37th consecutive month of year-over-year sales gains, selling 156,698 vehicles — 11 percent more than in April 2012. Chrysler’s share of the market increased to 12.2 percent from 11.9 percent.

“Chrysler Group’s best April sales in six years helped to maintain our sales momentum,” said Chrysler’s head of U.S. sales, Reid Bigland. “Our sales last month were solid across the board with seven Chrysler Group vehicles recording their best April sales ever.”

They included the Jeep Wrangler and Compass, the Dodge Challenger and Journey, the Ram Cargo Van and Fiat 500. The Dodge Dart, which launched last June, had its best month yet.

The situation was less rosy for foreign automakers. Toyota Motor Corp. saw its sales slip 1.1 percent in April to 176,160 vehicles, while its market share slid to 13.7 percent from 15 percent a year ago.

The company said the decline was due to a conscious decision by Toyota to cut back on less desirable fleet sales.

“Retail sales continue to grow,” said Bill Fay, head of the Toyota division in the United States, during a conference call. “Toyota division was the No. 1 retail brand in April and remains the No. 1 retail brand year-to-date.”

Honda Motor Co.’s sales were up, but not as much as the market as a whole. Though Honda sold 7.4 percent more cars and trucks last month than it did a year ago, its share of the market dropped from 10.3 percent to 10.2 percent.

Nissan Motor Co. bucked the trend in a big way. Its sales were up 23.2 percent last month, and its share of the market grew from 6 percent to 6.8 percent.

Analysts cautioned against counting the Japanese out.

“The weakening yen is giving the Japanese a lot of room to boost incentives, cut prices, pack vehicles with more content at lower prices, and increase marketing,” said analyst Michelle Krebs in a report released Wednesday.

“This will challenge Korean automakers the most, since it cuts into the Korean strategy to provide value with lower prices and higher content. It will affect the Detroit Three as well — but at least they have some profit buffer to respond, and they have the advantage of dominating a truck market that’s flourishing more and more every month this year.”

In fact, Nissan announced that it is cutting pricing on most of its models.

“Nissan’s incentive spend has historically run far higher than Toyota’s and Honda’s,” noted Citigroup analyst Itay Michaeli in a report Wednesday.

“This may have created a situation where Nissan’s vehicles were disadvantaged on Internet searches due to higher MSRPs … Reports do suggest that Nissan plans on reducing rebates to offset some of these announced price cuts, so this move may not necessarily amount to a price-war deceleration but rather an adjustment to the go-to market strategy.”

By Bryce G. Hoffman, Melissa Burden and Karl Henkel The Detroit News

From The Detroit News: