$4000. Waiting on a few more bids.what were you quoted? 200 amp service? just curious what other areas in the country are charging
$4000. Waiting on a few more bids.what were you quoted? 200 amp service? just curious what other areas in the country are charging
Time to sell my copper guttersLooking at getting my panel replaced, three month lead time and the price of copper are spicy.
Covid basically broke the supply chain along with high demand from people being at home and starting home projects are causing shortages and thus high material spikes. Everything is in back orders.
Absolutely this is causing the the slow down in home building.
An interesting thing to watch is what will happen to the housing market once the covid foreclosure ban is lifted and the forbearances (pause on the mortgage payments) end on June 30, 2021. The last number I saw was that about 2.25 million homeowners in forbearances.
How many foreclosures are we about to see and what will this do to housing prices?
There are quite a few spec builders that are limiting the # of houses they sell on a monthly basis. I heard of one that is only selling at a rate of 3/monthIf you’re a custom builder doing Cost Plus, then it’s probably not a concern building right now. If you’re a spec builder (especially doing multiple specs), you’re taking a big chance building in this current environment.
The foreclosure won't happen. those on forbearance will have their deferred payments rolled in or a modification done.
True, but what homeowner wants to sign up for cost plus in this environment? They may end up paying 33% above the initial budgeted estimate.Completely understandable. That’s why I was saying unless you’re a builder doing Cost Plus, it doesn’t really make sense to build a spec or give a fixed price on a custom build right now.
This is exceedingly likely. It's very easy to simply push the note down the road another 12-15 months.The foreclosure won't happen. those on forbearance will have their deferred payments rolled in or a modification done.
You have a point here. In a normal market there are always a certain number of foreclosures. Those have been put on hold. However, I agree with what others have said that most foreclosures will be put on some sort of deferral or restructuring plan.Interesting.
I have read that one of the reasons for the housing bubble (if there is one) is because of the lack of foreclosures. That there are a couple of million foreclosures that would have occurred but for corvid and that many of these will come due a few months after the 6/30 deadline (unless it's extended).
What do you think of this possibility?
True, but what homeowner wants to sign up for cost plus in this environment? They may end up paying 33% above the initial budgeted estimate.
I think it'll be tough to see that happen just due to the fact many companies will just add it to the back end or modify the loan. Nobody is going to want to foreclose in this environment, right after a pandemic. That along with rising home values, most would probably end up selling at a profit if they did get behind on payments.Interesting.
I have read that one of the reasons for the housing bubble (if there is one) is because of the lack of foreclosures. That there are a couple of million foreclosures that would have occurred but for corvid and that many of these will come due a few months after the 6/30 deadline (unless it's extended).
What do you think of this possibility?
To add to the work from home topic, I think there was an inflection point where we realized wfh was working better than many thought it would, myself included, and this thing was going to last awhile.Not to sound overly simple, but I don't see this as a "political" issue.
The builders have slowed down construction because their materials costs have skyrocketed. This is largely due to lumber prices going up. Lumber prices are increasing mainly due to the fact that Canada isn't shipping/processing lumber. Canada isn't shipping/processing lumber because they're still shut down due to COVID.
Or, perhaps, the Canadian lumber industry is more-or-less back in business. The problem is simply that the supply chains have been emptied, because the industry was shut down for an extended period.
The issue is really a mismanagement/miscalculation with the supply chains surrounding COVID. Many businesses guessed their business would slow down at the start of the pandemic. They were wrong.
We make microprocessors? Clearly our business will slow down as a result of the overall economy contracting, and people will be making less big purchases like appliances and cars.
However, lets ignore the fact everyone will be working from home, and will need all the equipment and supplies to make the possible/efficient. Laptops, monitors, keyboards, mice, printers, better routers, etc.
We make plywood and 2x4's? Clearly our business will slow down as a result of the overall economy contracting, and people will not be buying new homes because they'll be scared about job security.
However, lets ignore the fact that everyone will be working from home (and most very secure in their job), with their wife and 2 kids in the house. The idea they may want more house to so they can have a home office is beyond our ability to comprehend. Furthermore, people that are actually out of work, and homeowners, and stuck at home cause they have nothing else to do, would never dream of buying some wood and starting a DIY project at the house.
I'm not trying to bash the decisions some of these companies made, but in hindsight, a lot of them were laughable.
And so it begins, the start of the housing down fall coming. Just wait till all these over priced homes that the millennials bought or built find out how much under water they will be in the year to come.I know it's political in nature, but let's try to have a discussion on it without people losing their shit.
Housing starts fell 9.5% in April to an annual rate of 1.57 million. Single-family home starts dropped 13.4% to an annual rate of 1.087 million. Could the slowdown be tied to soaring material prices? | #realestate #homebuilding #economy
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Construction Cools as Costs Climb
Housing production fell in April due to the increased costs of building materials that have priced out potential home buyers. Overall housing starts decreased 9.5% to a seasonally adjusted annual rate of 1.57 million units, according to a report from the U.S. Department of Housing and Urban...nahbnow.com
The question was about housing starts falling. Central Texas Housing starts are falling due to the points I made. Costs are up and building materials short, along with available lots to build.Forgive me but I don't follow your message here. Are you saying central texas is slowing down or not slowing down?
I am surprised to hear that central Texas housing starts are falling. I'm not doubting you, but do you have any statistics on it? I'm talking specifically CenTex.The question was about housing starts falling. Central Texas Housing starts are falling due to the points I made. Costs are up and building materials short, along with available lots to build.
I think you are misreading this. Materials prices have rocketed up. Now is an unwise time to build unless you have no other options or have a lot of money.And so it begins, the start of the housing down fall coming. Just wait till all these over priced homes that the millennials bought or built find out how much under water they will be in the year to come.
No I get it. that's why I'm saying for all the first time home buyers and people that bought at the high market levels are going to feel the pain in the short future. If your a seller it's great, but not as a buyer.I think you are misreading this. Materials prices have rocketed up. Now is an unwise time to build unless you have no other options or have a lot of money.
We just built a new house and moved in a few weeks ago. The whole neighborhood is sold out now with the only the builders second section, they are holding the sell of final two homes due to costs rising. And every other neighborhood when we starting looking where to build was getting further and further out of town, and basically sold out, except for the one we found which had just opened. That builder doesn't have anything else now except a few lots in Georgetown or build on your own lot.I am surprised to hear that central Texas housing starts are falling. I'm not doubting you, but do you have any statistics on it? I'm talking specifically CenTex.
Isnt the obvious next step to buy development tracks west and north of liberty hill? I don’t know why development needs to stop. Maybe there is an opportunity if the traditional developers are tapped out.We just built a new house and moved in a few weeks ago. The whole neighborhood is sold out now with the only the builders second section, they are holding the sell of final two homes due to costs rising. And every other neighborhood when we starting looking where to build was getting further and further out of town, and basically sold out, except for the one we found which had just opened. That builder doesn't have anything else now except a few lots in Georgetown or build on your own lot.
Since then, the whole market has gotten crazier. Even the suburbs entry level new builds in Leander, Taylor, Hutto have soid out so fast their future sections are not ready until next year. Inventory is extremely low and new builds are short simply because their lots sold out much faster than expected. The cost situation complicates timing of more.
Also consider if mortgage rates go up materially, which is possible, it will be substantially more difficult to sell that house that was overpaid for down the round if they need to exit that purchase.No I get it. that's why I'm saying for all the first time home buyers and people that bought at the high market levels are going to feel the pain in the short future. If your a seller it's great, but not as a buyer.
I was offered just last month to sell my property and would make 4 times my money, but where would I go?
I would make a mistake and be in the same position as these new buyer are in so I'm going to hold.
Nice write-up. There is also a lot shortage. The industry shut down lot development the early part of Covid, house sales took off, and the lot development pipeline is having a hard time catching up. It takes two years to entitle and develop a tract of land, and land values have gone through the roof, making it tough to underwrite new projects. The housing market is the best I have seen in my 30 year career as a developer and the demographic drivers of our busines have a very long runway. Affordability is becoming an issue which will likely start showing up in the numbers late year, especially if interest rates go up.Not to sound overly simple, but I don't see this as a "political" issue.
The builders have slowed down construction because their materials costs have skyrocketed. This is largely due to lumber prices going up. Lumber prices are increasing mainly due to the fact that Canada isn't shipping/processing lumber. Canada isn't shipping/processing lumber because they're still shut down due to COVID.
Or, perhaps, the Canadian lumber industry is more-or-less back in business. The problem is simply that the supply chains have been emptied, because the industry was shut down for an extended period.
The issue is really a mismanagement/miscalculation with the supply chains surrounding COVID. Many businesses guessed their business would slow down at the start of the pandemic. They were wrong.
We make microprocessors? Clearly our business will slow down as a result of the overall economy contracting, and people will be making less big purchases like appliances and cars.
However, lets ignore the fact everyone will be working from home, and will need all the equipment and supplies to make the possible/efficient. Laptops, monitors, keyboards, mice, printers, better routers, etc.
We make plywood and 2x4's? Clearly our business will slow down as a result of the overall economy contracting, and people will not be buying new homes because they'll be scared about job security.
However, lets ignore the fact that everyone will be working from home (and most very secure in their job), with their wife and 2 kids in the house. The idea they may want more house to so they can have a home office is beyond our ability to comprehend. Furthermore, people that are actually out of work, and homeowners, and stuck at home cause they have nothing else to do, would never dream of buying some wood and starting a DIY project at the house.
I'm not trying to bash the decisions some of these companies made, but in hindsight, a lot of them were laughable.
Interesting I have a lead for a job at a central Texas home builder and news like this was giving me pause and then you post this. It’s difficult to decide what is the right move, it is a real career path that could lead to a lot more money but I currently have a recession proof job and this jump would be for about 30K less although a chance for much more in the future.My buddy is VP of a central texas home builder. He said he could sell 100s of new build houses right now, but he could only start about 8 a month in each neighborhood. Why lock into a price today, if you can't start building for a months and the material costs could be substantially higher.
They opened a neighborhood up and created a waiting list for prequalified (with their lender) preferred buyers. Neighborhood section has twenty or so lots. The list was up to 200 in less than an hour.
I don't think it is slowing down yet, just builders getting smart with only selling what they can build (at least in Texas).
It’s absolutely something worth monitoring and could cause a huge flood in the market.Interesting.
I have read that one of the reasons for the housing bubble (if there is one) is because of the lack of foreclosures. That there are a couple of million foreclosures that would have occurred but for corvid and that many of these will come due a few months after the 6/30 deadline (unless it's extended).
What do you think of this possibility?
Yeah I don’t see the political angle at all. Pure supply and demand issue exacerbated by an extremely rare housing market.I don't see it as political because i attribute it more to the pandemic's impact on consumer priorities and behavior, and disruption to the materials/supply.
I'm not in the industry, but I've heard that the Austin area won't have enough homes to meet demand for at least 10 years. I might ride that wave if I was in your position, but I've never taken a career risk so who am I to talk. admittedly, initial 30k/year loss is a hard pill to swallow.Interesting I have a lead for a job at a central Texas home builder and news like this was giving me pause and then you post this. It’s difficult to decide what is the right move, it is a real career path that could lead to a lot more money but I currently have a recession proof job and this jump would be for about 30K less although a chance for much more in the future.
That is actually something I didn't know about the land development side of things.Nice write-up. There is also a lot shortage. The industry shut down lot development the early part of Covid, house sales took off, and the lot development pipeline is having a hard time catching up. It takes two years to entitle and develop a tract of land, and land values have gone through the roof, making it tough to underwrite new projects. The housing market is the best I have seen in my 30 year career as a developer and the demographic drivers of our busines have a very long runway. Affordability is becoming an issue which will likely start showing up in the numbers late year, especially if interest rates go up.