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[SBB]

Here in the great state of NC construction is slowing down.
I laid off a bunch of people last Friday and have more to go.
I am concerned that this slowdown will last for a while.
Usually things slow down during an election year or in winter but this slowdown is real early.
I have some friends that have already been affected by this.

The purpose of this thread is not to broadcast doom and gloom but to get comments from others as to what's happening in their area.  NC has in the past been a relatively steady region for building but has slowed down a lot in the past few months.


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[Hugh Janis]

Sorry to hear of your slow down S/B.  My 401k grew $10k in the last week and I'm a sales rep at 110% to plan for the year so far.  Maybe the recent market upturn will free up some money for capital improvements and support folks like yourself.

[SBB]

Sorry to hear of your slow down S/B.  My 401k grew $10k in the last week and I'm a sales rep at 110% to plan for the year so far.  Maybe the recent market upturn will free up some money for capital improvements and support folks like yourself.

jgeorge

It's not really "MY" slowdown but more of an industry reaction to the sub prime fiasco.
0 down and easy credit eventually caught up with the industry.
I'm sure NC isn't the only affected area.

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[Midnight Rider]

Chip...the housing market here is slow.  One of our recent hires (Faculty at UAB) was looking for housing in an area (older homes, but remodeled) that is highly desirable because of schools, proximity to downtown, etc.  Many of the homes he looked at dropped as much as 100K in a matter of 3 months.  Of course, the market in that area was over-inflated in the first place, IMO, and the bubble bursted.  Many young families were buying more house than they could afford.

The new homes in my immediate area are still selling, but most of them are what I consider to be Garden Homes...small lots, with big houses.  These are spec homes.  The custom builds are still going strong, but most of those buyers have no money worries, unlike the younger families with children.

From what I've read, Countrywide, one of the largest mortgage companies in the country, just about went under recently.  Things will bounce back.  It must be hard laying off workers that you know need to be working, but you have no choice.

[Special_Ed]

Hi Chip,
Sorry to hear things haven't picked up. In terms of the local housing market, the sub prime mess hit the NE area pretty hard too. There are still houses and developments going up but they've slowed and as Terry stated the numbers are adjusting themselves accordingly.

Commercial and industrial construction in my area is slow, there are projects out there but it seems as though contractors are bidding at only a 2 or 3% margin. I've come in second on more projects then I care to count. We've been bidding everything that comes along just to keep cash flow moving and keep the employees we have working, about 20 electricians and a couple pipe fitters, 2 years ago this company had 100+.

I hate having to layoff workers, with my type of construction our employee numbers are up and down constantly but I hate having to hand anybody their last check. I feel for you Chip, it's not an easy thing to do.

As slow as it is the market opened at 14087 this morning.

Hope things pick up soon for all of us,

Ed

[greglyon]

The housing market in the Phoenix metro area is in the crapper due in part to the sub prime lenders, speculators, people in default, which all adds up to large inventories of homes for sale.     

[VAZHOG]

You think it's slowing down NOW, Just wait until you let these folks get control and see how fast we bounce back

http://www.foxnews.com/story/0,2933,298922,00.html

[Midnight Rider]

You think it's slowing down NOW, Just wait until you let these folks get control and see how fast we bounce back

http://www.foxnews.com/story/0,2933,298922,00.html

You pay for everything, one way or the other...labeling the dollars has little to do with the issue, IMO.  But then, let's not sidetrack this into a political philosophy discussion....

[SBB]

But then, let's not sidetrack this into a political philosophy discussion....

Please!


thanks TC

[GC_Super]

I have two friends that are home builders. One builds large, very large houses in the Texas Hill country. He's doing great. When I asked him if the sub-prime problems were afecting him, he just laughed and said he hadn't even had to deal with a bank in a couple of years. His customers were paying cash. On the other side, my other friend builds specs in the 200K to 400K range in north Texas. Said he doesn't like to deal with people during the building process, hence the specs, but he is sitting on 4 houses right now and said he will wait until he sells two or three before starting anymore. He's pretty worried.

[RedFXR2]

In general, the housing market in FL is dead.  Unless you're pretty wealthy.

I know a guy who builds homes in the $1M to $5M range.  He says his market might be a bit softer but his customers aren't much working for paychecks anymore so they're not affected.  Premium waterfront properties, mostly.

My neighbor is a RE agent--he tells me that if he didn't have rental property providing income that he would lose his own house.  Hasn't sold anything in almost a year.

Down here, it seems that anybody that could bought additional houses and condos over the past few years planning on only making a few payments--flip them in 3-6 months.  Some made a lot of money, if they got in and out before the bust.  Others got stuck with more properties than they can afford and cash flow is now catching up with them.  Horror stories in the papers about working people trying to make money in real estate and now in a bind.  Or others simply trying to move, some out of state, and stuck with their Florida house (and FL taxes and FL insurance...$$$$).

The "experts" down here say that right now, most sellers are still holding out on their prices, hoping for the best but after a while, they're going to have to come down.  They have a good reason to sell those houses--they have to, some have already moved, others are amateur speculators--and crunch time is coming.  The owners can't make those multiple mortgage payments.  They say about a year from now, there will be some real bargains in Florida.  I see new developments near me that appear to have stopped cold.  Cleared lots with weeds growing back.  Some with partially constructed homes.  No activity.

And elsewhere, my RE Agent brother-in-law up in Ohio got a full-time job in a retail store for benefits mainly.  He hasn't sold anything, even taken a phone call in months. 

[Midnight Rider]

On the other hand, Chip...I am seeing a lot of construction in the support services area.  I guess that is the lead/lag thing, in that first come the houses and families (two to five years ago), then comes the drug stores, food stores, strip malls, etc, to support the additional people in the area.

I swear though, I don't see how another drug store or grocery store can open around my area and make any money...seems they are on every corner.

At one point, Shelby County (Alabama) was the fastest growing county in the Southeast...thousands have moved here, and the schools systems are just now beginning to catch up.  I suspect that the Birmingham area will be less effected by some of this slow down than other parts of the US, as we are in the "Sun Belt", property taxes are rediculously low, etc.  Florida doesn't count...nothin' but a bunch of damn yankees there now anyway, except for the Panhandle.  I think the Condo market is suffering badly on the Gulf Coast right now though...for one thing, you can't get them insured.

I've never had any money to invest in property...can barely afford the very modest home I'm in these days...so no changes for me because of all this sub-prime stuff.   Hopefully, by the time I retire (5-6 years) things will bounce back, and my modest home will be worth more because of it's location, then I'm selling out and gettin' the hell out of Dodge.  The only thing I'll inherit is a funeral bill...

[hogasm]

Here on the North Carolina coast, building is down considerably. We personally are down 90% from last year. All my employees got scared and left before the end of last year. Good thing for me in one way, dont have to pay unemployment.

Houses over 2.5m are being built but the under 1m houses are almost at a stop.

At least this week there were only 38 houses on the courthouse steps for foreclosure.

[JCZ]

Chip, the Central Valley of California has the highest foreclosure rate in the nation and it's been that way all this year.  If that's not a sign of the times.........

Just stopped by the dealership and talked to one of the guys that I've known for a number of years.  He let me know that sales has all but came to a halt and doesn't know what the future holds.  He was asking me my opnion of what I thought the economy would do in the near future.  I thought to myself "ooohhhh......this doesn't sound good at all".

[grc]

The situation is similar here in Northwest Indiana (Chicago suburbs).  The small (30,000 and less population) towns in south Lake County and in Porter County have seen nothing but boom since I moved here in '94.  People moving from Illinois to escape the ridiculous taxes, as well as folks moving south from the old crime infested industrial areas like Gary, kept new construction humming and local populations growing.  Well, this past year my town has seen a 50% reduction in income from building permits and fees.  There is a new subdivision that's been going in across from me since last year; the streets and utilities are in, the common areas landscaped and fenced, and not one single foundation has been poured.  

From what I can see, there are plenty of people still looking, but they are having real difficulties selling their existing homes.  This especially affects those moving from some of the less desirable cities and towns, since the value of their home is declining and the pool of possible buyers has been slashed by the tightened credit requirements.  

Jerry