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No one building anything anymore

From Curbed.com blog

By Curbed.com, Thursday, June 18, 2009.

SAN FRANCISCO -- Builders! They have no work and are laying off all of their workers. This past week the Moscone Center has been hosting the annual Pacific Coast Builders Conference. Horace Hogan, chairman of the California Building Industry Association (they put on the PCBC) and president of Brehm Communities (homebuilder), said, "Every builder I know has laid off most of their staff, and contractors and suppliers we've done business with for years have folded up shop."

At the peak of the housing boom in 2006 the conference drew in 35,000 attendees -- that's 21,000 more people than this year. "It's like a ghost town," said Andy Mihaylo, president of the Christane Co., an Orange County firm. The lack of building means a lack of jobs, and Hogan says that 360,000 jobs in his industry are now gone.

Sam Chandan, president and chief economist of New York's Real Estate Econometrics, has even more bad news. He predicts a "huge wave of defaults in commercial mortgages."

"This used to be the kind of show where we'd have six or seven people in the booth and they would all be busy at once all the time," said Adam Slutske, owner of Century Shower Door. "Now it's quiet, very quiet."

Reposted with permission from Curbed.com. Click here to view original post.

Copyright (c) 2009 Curbed.com LLC

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Submitted by Lori Bee , Owner/BIC on June 21, 2009 - 5:29am.

They don't exactly cover some of the important reasons why so many builders are out of business. Yes, the obvious is the general slowdown of the real estate market. However, many have tried to hang on, stop building, and slash prices on inventory.

However, banks have RAISED interest rates on construction loans 2-3% ABOVE the rates 1-2 years ago (when the prime is down considerably), and some have even called the Construction Notes in full, even when payments have been kept up. The banks will not negotiate on rates or anything else in my experience when a new construction is involved.

I have also had banks flat out tell me that they have used the TARP funds for "loss mitigation," and NOT for incentives for lending. All of this contributes to why builders can not hang on... So much for the American Dream... Very sad...

LORI BEE - BEE REALTY
Owner,BIC,ABR,CSP,e-PRO,RLI
Lori@BeeRealty.com
http://BeeRealty.com

 
Submitted by Ian S. Greenleigh on June 22, 2009 - 3:11pm.

Every piece of news like this makes me feel like I made the right choice in moving to Austin from the Bay. I miss it sometimes, of course. I also feel for those builders and RE professionals out there, and count many of them among my friends. Maybe these conditions will prompt them to seek out a living elsewhere. Sorry, Austin's full up. :)

Ian S. Greenleigh
DriveBuy Technologies
Branded Mobile Marketing for Real Estate
http://www.drivebuytech.com

 
Submitted by Patrick Pollard on July 1, 2009 - 1:40pm.

There are many who may disagree but there seems to be a bigger recession happening in all of California. casino online