(A SolAire Home | Photo Courtesy of SolAire Homebuilders)
During this era of COVID-19 uncertainty, one of the industries that has managed to stay strong in Central Oregon is that of home building. Deemed an essential business in the state and a core industry here, our local builders have kept construction projects going, and for some, the familiar clamor of hammers hammering and the hum of heavy machinery off in the distance may be somewhat comforting, sounds offering a welcome hint of “normalcy” during a season that has been anything but that.
Central Oregon Association of REALTORS (COAR) released numbers that point to a slight decline in new residential construction over the past year, and particularly since the pandemic was announced. In the time frame between March 23 and May 13, 2020, total new listings in the region dipped 9 percent over the same time period in 2019, and total pending listings dropped by 37 percent this year as compared to last year during this time frame. The number of new homes sold during this time is down 15 percent over the same time frame last year, and the median sale price dropped from $414,945 during this stretch of time in 2019 to $393,424 now.
However, local home builders paint an optimistic picture, and say that they aren’t too concerned that this dip will last very long. We at Cascade Business News checked in with several of the builders in our region to see how business is going, and how the pandemic has affected what they do and how they do it. Here’s what they had to say:
Kate Eskew, home sales and marketing, SolAire Homebuilders
Q: Have state and local distancing rules hindered progress on existing projects?
A: SolAire Homebuilders and its contractors are successfully adapting to the new guidelines. We’re finding our biggest challenge is scheduling. We used to schedule related crews at the same time so they could collaborate on the job. Now, we schedule one crew at a time. This has slowed progress and extended deadlines. That said, our contractors have been great, and we are getting our jobs done.
Q: Has the pandemic affected the overall cost to build a home?
A: The same conditions that affect building costs are present: cost of labor, cost of materials and cost of land. SolAire hasn’t seen changes in these areas.
Q: Are materials readily available?
A: Materials are available. Production and shipping times are taking longer than normal. SolAire is responding by increasing our lead time for ordering supplies and materials for our jobs.
Q: Are you concerned about future supplies?
Right now, we’re not concerned about supplying our projects. Supply chains are complicated, and we can’t predict how they will be affected over time. Our approach is to stay informed and to stay nimble so that we can continue to do business and to provide the level of service that our clients know they can count on.
Q: Anything else to add?
A: Hardship is a part of life. Whether it’s financial, health, loss, divorce or something else, most of us have experienced hardship in our lives. Where many of us have experienced this at different times of our lives and we live through it in our personal networks, this is the first time in our lifetime that we’re experiencing hardship on such a large scale. We’re experiencing how connected we are and how small the world is. Right next to hardship, there’s hope, beauty, excitement, love. While we at SolAire are adapting to rapidly unfolding change, we are remembering to take in the beauty of the area and to smile at the little things every day.
At SolAire Homebuilders, we’ve been talking a lot about resilience. We specialize in building homes that have efficient use of energy, are built to last and easy to maintain. With low emissions, they are easy on the earth, comfortable and can generate and store their own power. We build a resilient home. It not only lasts a long time; it provides a space for its occupants to be resilient too.
Jay Campbell, owner, Woodhill Homes
Q: Have state and local distancing rules hindered progress on existing projects?
A: We are grateful that construction is an essential business. We have been able to keep our projects moving forward with little impact. We only schedule one trade (subcontractor) in a home per day. In the past, we sometimes have more than one contractor in a house at a time, but now we are very strict about only allowing one in at a time. The subcontractors are appreciative, and it allows everyone to follow COVID social-distancing guidelines. Your business becomes your family; co-workers become your bubble, but we don’t want to cross businesses.
Q: Are future projects being affected? How?
A: Future projects are affected because of sales. We have been able to keep our existing sales in place through COVID-19 and are waiting to see what happens with new sales in the next four to eight weeks. We have orders to fill and homes to build, and it takes about three months to complete the process. Our inventory of spec homes is low due to how busy we were before COVID, so we are able to react quickly as demand dictates.
Q: Has the pandemic affected the overall cost to build a home?
A: There are some small concessions from suppliers, but overall costs have basically stayed the same.
Q: Are materials readily available?
A: It seems to be hit or miss. We have had an issue with materials coming from Washington state where construction was not deemed an essential business. Other areas where we have seen a supply issue have been in door manufacturing and cabinets. Companies that have production facilities are having a much harder time dealing with COVID-19 social-distancing requirements. Ultimately, this affects what they can produce. They have to rework how they do business. Some have assembly lines, but they can’t be bumping elbows, at least not for now.
Q: Are you concerned about future supplies?
A: If business is allowed to open up, then no.
Q: Anything else to add?
A: Realtor visits and model home visits have been very slow, but our internet traffic is the highest it’s ever been; we’ve seen a ten-fold increase. It appears that people are still looking to buy homes, but they are doing the research from their computers or other devices. Much of our traffic is from outside cities. Trends point to people wanting to leave cities; we are seeing that. We’ve had lots of drive-by traffic at our sites too. We assume these are buyers. I believe there will be pent-up demand. I think the next four to six weeks will indicate how things will go. There were people ready to buy, and I believe they’ll move forward with buying their home. Now more than ever, it’s important to have your space.
David Rink, president, D.E. Rink Construction, and past president Central Oregon Builders Association
Q: Have state and local distancing rules hindered progress on existing projects?
A: Our process has slowed down. Some of our employees have to work from home to also homeschool their kids. National Association of Homebuilders (NAHB) sent suggestions on how to work with social distancing and sanitizing the workspace. We have to schedule subcontractors so that they have social distance and are not working too closely to other subcontractors.
Q: Are future projects being affected? How?
A: Some projects are postponed until COVID is gone. Some are cancelled.
Q: Has the pandemic affected the overall cost to build a home?
A: We are not sure yet on material costs and availability. Some subcontractors are lowering prices to get jobs. Some are raising prices.
Q: Are materials readily available?
A: So far, yes.
Q: Are you concerned about future supplies?
A: Eventually the costs and supplies will be affected.
Q: Anything else to add?
A: We plan to continue building and taking care of our clients and employees. It is too early to tell what will happen with the building industry. We have heard from realtors that they are busy with calls and buyers. I think Central Oregon will weather this storm well. We can take this pause as a time to re-evaluate our future and goals. Let’s all appreciate and take care of what is here so that when the economy opens, we are ready.
Matt White, general manager of Bend Operations, Neil Kelly Company
Q: Have state and local distancing rules hindered progress on existing projects?
A: It did slow us down initially, but now it is just part of our standard routine. We immediately implemented the COVID-19 Safe Job Site Practices endorsed by the AGC (agc-oregon.org) and COBA. Our Bend team was quick to react and takes these measures seriously. Our clients are very appreciative of the efforts that we have been making on the job sites to keep everyone safe and healthy.
Q: Are future projects being affected? How?
A: Yes, some of the projects that were in our design pipeline initially went on hold until everyone could re-group. We adapted to virtual meetings very quickly and our clients were quick to adapt as well. We now have a mix of in-person and virtual design and pre-construction meetings. Business has picked up significantly in the last two to three weeks.
Q: Has the pandemic affected the overall cost to build a home?
A: Yet to be determined. Supplies and trade contractors became harder to secure initially. At the same time, we have been able to re-secure pricing on other elements. I believe there will be a slight downward price adjustment over the next couple of months, but then prices will steadily increase as the demand continues to increase.
Q: Are materials readily available?
A: If it was warehoused locally, then we have a better chance of securing the material. Items that are made across the country and shipped are taking a bit longer. Some factories were closed. We are still wrapping our arms around this issue. Fortunately for projects in production, we had secured most of that material well ahead of time. Of course, there is a fair amount of material that comes from overseas as well, but we try really hard to source product from within a 500-mile radius.
Q: Are you concerned about future supplies?
A: Only in the short term.
Q: Anything else to add?
A: Go support your favorite local small businesses!
Steve Bennett, owner and general contractor, Steve Bennett Builders
Question (Q): Have state and local distancing rules hindered progress on existing projects?
Answer (A): No. Fortunately, our business is strictly high-end custom home building where social distancing is inherent on the job site. Many of our subcontractors wear masks and gloves on the job by default, regardless of the new rules. We rarely have more than two or three subs on the job at one time and they are often separated by hundreds of feet.
As a result of COVID, some of our subs are taking extra precautions by working atypical hours in order to avoid any contact with other subs, which we fully respect and support. COVID has prompted us to focus more than ever on the health and safety of our job sites and project teams. COBA and the Bend Chamber of Commerce have been supportive in providing us with current information and helpful resources, which we have disseminated to our project teams.
As always, we communicate openly with all subs and vendors on our job sites. Our commitment to promoting an atmosphere of mutual respect and loyalty on our jobs for the past 25 years is paying dividends right now in these difficult and uncertain times.
Q: Are future projects being affected? How?
A: Yes. Fears of an economic downturn have prompted some new home starts to move more slowly. We have one project on pause until further notice. The uncertainty has given us all pause.
Q: Has the pandemic affected the overall cost to build a home?
A: No.
Q: Are materials readily available?
A: Yes. Other than N95 masks; those are extremely difficult to source right now, if not impossible. Our painters, framers, masons and finish carpenters are all running short on N95 masks. Luckily, most had enough inventory to get by. Everyone is certainly being more mindful to conserve when and where possible.
Since 1995, we have always worked almost exclusively with local, family owned suppliers and vendors like Johnson Brothers, Stereo Planet, Baptista Tile, Parr Lumber, Building Solutions, etc. We don’t deal with big-box or national outfits that may be struggling more with international supply chain issues.
Q: Are you concerned about future supplies?
A: No. We have worked with the same suppliers here in Central Oregon for 25 years. We work very closely together and communicate almost daily. We have received no indication from our suppliers to validate any doubts or concerns of supply issues. Additionally, we have always had a process for backup sources of materials to avoid any risk of project delays. COVID has only validated our standard operational preparedness.
Q: Anything else to add?
The population in Central Oregon has grown exponentially over the past few years, and at times it’s difficult to recognize our small towns. But we are still a tight-knit community. COVID has only highlighted that fact.
At Bennett Builders, building relationships has and always will be at the core of what we do. We have worked with many of the same trade partners, suppliers and vendors for 25 years. We are literally like family, now more than ever.
In life and especially during these times, it is my firm belief that we can choose to either let fear or love determine our attitude and actions. “Love casts out fear.”
