According to most experts, demand for new homes still outpaces supply across the country. In some locales builders are slipping behind even newly-adjusted schedules for new construction, meaning that buyers must put their dreams on hold even a bit longer. Delays are caused by several different factors, however, so finding an easy solution may be difficult.
Rebounding from the Recession
Even though almost a decade has passed since the housing bubble burst, the effects of the subsequent “great recession” were so deep that many construction companies still face serious labor shortages. Building a house is a team effort, where one specialty trade follows another during good times in a well-choreographed “performance.”
However, when delays are encountered for any reason, the entire schedule is affected. Trained specialty contractors are in short supply. When fewer skilled tradespeople are available, delays are inevitable.
Land availability is a second factor: Developed lots are being built upon faster than raw land can provide replacements. Cost of development has also risen due to increased demand, governmental mandates and more stringent zoning regulations. Developers and builders scramble not only to keep up with demand, but to keep both land and building costs in check.
Finally, a healthier economy is a mixed blessing. As the economy improves and interest rates creep upwards once again, the cost of credit, especially interim financing, also rises. If a house takes longer to complete, the overall cost of construction rises as well. It’s as natural as day following night.
The truth is that costs will almost certainly continue to rise, because of these and other factors. The rate of new home construction may also slow. Some parts of the country have begun to note such slowdowns. A basic truth is that the face of homebuilding is changing, and no one is quite certain what it will look like in the future. Although no one currently believes that the suburban family home will disappear, there is some indication that multi-family condo development and urban infill projects may outpace new single-family home construction at some point.
The challenges are real, but the problems are not insurmountable.
Meeting Challenges Head On
It’s not only the construction industry that faces challenges today. In all areas of commerce, from fast food to software, from ship building to travel planning, corporate leaders seek better efficiencies, human resources personnel seek better ways to attract and train workers, and firms of every size from solopreneur to Fortune 500 seek to reduce waste and to boost margins.
At the same time, every customer wants to be treated individually.
Aterra recognizes that need and subscribes to the effort. A major part of our lighting and electrical design business is built on the principle of customizing specifications and installations to meet customer preferences and respond to growing demand for new and innovative products. We pride ourselves on doing that.
We also take pride in our ability to help volume builders offer similar customization to their buyers without adding additional costs or time to the building schedule. In fact, just the opposite. By acting as liaison between builder and electrical contractor, we help to increase efficiencies in new homebuilding, assist to streamline production schedules and increase satisfaction for everyone involved.
It’s just one facet of our value proposition.
By working with local builders to add value to the end product, we strengthen not only those builders but the whole of our local economy. By doing what we do best, we assist in the effort to build better homes and create happier homeowners. It’s something we think we do well.
We work with local architects, designers, home buyers, contractors and builders to meet the need for a better, brighter and more profitable future.
Every little bit helps!