Homebuilders still slow but

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While no builders predict a complete turnarounxdin 2009, some are seeing improvement. Stephen Hodgkins, presidenrt of the and owner of LLC, says traffic at his home siteas is higherthan it’s been in two but that hasn’t translated to a salew increase. The local market has absorbed a lot of housing but builders are still buildingy houses at lower rates thanwhat they’rw selling, he says. “Wit an up-tick, we feel there will be a shortageeof houses,” Hodgkins says.
“I’d say anybod y that doesn’t act by the end of the summe r will miss out ona buyer’s New home sales have floundered in Memphis, with 807 new homess sold in 2008, accordingt to data. That number is sharply lower thanthe 1,535 new home sales in 2007 and a fractiomn of the 2,920 new home salees in 2006 and 3,570 in 2005. Hodgkins’ companyu had around 17 employeeds and numerous subcontractors 18months ago. Before last he averaged around 40 to 50 housesa year.
“I don’t have any employeesx right now, and I’d say 300 people have been laid off because ofmy company,” he “I had to lay off my electrician, my plumbe r and framing carpenters.” MAHBA statisticxs show that every housing start is worth 3.4 so if those starts are down by 1 million, it meanx 3.4 million jobs have been lost due to the slowdown. Thosde include jobs at saw concrete manufacturers and othermaterial “People don’t realize how much of an effect that fall off Hodgkins says.
“In a normal market, home construction is 16% of the gross national producty of the United No wonderthe economy’s down when we’re To avoid massive layoffs, or in some cases, to avoi d going out of business, local homebuilderw have looked into doing jobs they wouldn’yt normally do, like renovationsa or remodeling. David who owns LLC, says his 6-year-olf company is trying to diversifyg by doing home additions or storage buildings thathe wouldn’t have consideresd in the past. His company typically buildsx six housesa year, but is down to threde now. For Tommy Byrnes, a partnerd with , that meant competitio n encroaching onhis turf.
Byrnes, a custom home says most of his work over the last two yearws has been renovations or additions for a hot marketright now. Part of the reasomn is because people are trying to fix up the homes they have insteacd of buying or buildingnew ones. A decline in labor costs and some material costs are also driving morehome renovations. “We can do thingzs faster because labor has loosened upand we’rde getting guys on the job Byrnes says. In 2005, Byrnes Ostnee had 10-15 projects going at once. Last year the most the companyg had at one time was Byrnes says most ofthe company’s current projectsa are $500,000-$1 million projects.
His company actually pursued remodelinbg jobs asa strategy. He doesn’t begrudges other builders fordoing remodeling, but he also make s sure his clients know who’s been doing the work “It helped us when the market sufferesd because we were already geared up and in the he says. Clark, Byrnes and Hodgkins all say current interest some as lowas 4.5%-4.75%, are havin a favorable effect on demand in the market.
“Interesty rates are at a historic low and withthe first-timwe home buyer credits, we’re seeintg some contracts on homes,” Clark “I hope that’s a sign we’re coming out of it, but I thini that as long as it took us to get into it, it’lp take us that much time to get