What Are the Real, Day-to-Day Challenges Contractors Face in Home Construction?
Member since 2024 · 3 posts · 0 votes
What Are the Real, Day-to-Day Challenges Contractors Face in Home Construction?
4 Replies
- 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
LOL its kind of like 50 ways to leave your lover.
And its very much dependent on your jurisdiction.
however I will list the stuff I have gone through the last decade or so through about 200 new builds in 4 markets.
1. material price fluctuations. rarely down almost always up pretty much annually.
2. as we all know labor scarce and or unqualified and do poor work.. I do not put in price of labor because for me I will pay for good subs they are the key.
3. State, County, City rules and regs every one is different. Some areas its not bad other areas its horrid and you do one and leave like for me I will never build in the city of Portland OR again. Suburbs is were we end up.
4. Access to capital at reasonable rates IE from a Bank not a HML or PML this is also a big deal HML / PML is generally 14 to 18% apr on your projects.. Banks even today are 7 to 8 I only use banks. But Banks only fund the very well qualified generally no way a beginner is getting bank financing unless your basically borrowing your own money.
5. Resale what retail buyers are paying for rates of course affects the business dramatically.
But I will say its worth the effort in the long run at least for us..
- Member since 2024 · 3 posts · 0 votes1y
Quote from @Jay Hinrichs:
LOL its kind of like 50 ways to leave your lover.
And its very much dependent on your jurisdiction.
however I will list the stuff I have gone through the last decade or so through about 200 new builds in 4 markets.
1. material price fluctuations. rarely down almost always up pretty much annually.
2. as we all know labor scarce and or unqualified and do poor work.. I do not put in price of labor because for me I will pay for good subs they are the key.
3. State, County, City rules and regs every one is different. Some areas its not bad other areas its horrid and you do one and leave like for me I will never build in the city of Portland OR again. Suburbs is were we end up.
4. Access to capital at reasonable rates IE from a Bank not a HML or PML this is also a big deal HML / PML is generally 14 to 18% apr on your projects.. Banks even today are 7 to 8 I only use banks. But Banks only fund the very well qualified generally no way a beginner is getting bank financing unless your basically borrowing your own money.
5. Resale what retail buyers are paying for rates of course affects the business dramatically.
But I will say its worth the effort in the long run at least for us..
Thank you for sharing your insights, Jay. It's very helpful to se the real challenges you've encountered across different markets- especially your point on finding qualified subs and staying away from high-rate lenders.
Giving the recurring issues with labor quality and scarcity, would you say automation tools like construction 3d printing or other tech are worth exploring? I'm curious if these new tech can somehow help me streamline certain tasks or reduce dependency on scarce trades in your experience.
Appreciate any additional thoughts - 1yJay HinrichsBusiness MemberReal Estate Consultant · Summerlin, NV · Member since 2014 · 45k+ posts · 66k+ votes
Quote from @Conrad Tillman:
Quote from @Jay Hinrichs:
LOL its kind of like 50 ways to leave your lover.
And its very much dependent on your jurisdiction.
however I will list the stuff I have gone through the last decade or so through about 200 new builds in 4 markets.
1. material price fluctuations. rarely down almost always up pretty much annually.
2. as we all know labor scarce and or unqualified and do poor work.. I do not put in price of labor because for me I will pay for good subs they are the key.
3. State, County, City rules and regs every one is different. Some areas its not bad other areas its horrid and you do one and leave like for me I will never build in the city of Portland OR again. Suburbs is were we end up.
4. Access to capital at reasonable rates IE from a Bank not a HML or PML this is also a big deal HML / PML is generally 14 to 18% apr on your projects.. Banks even today are 7 to 8 I only use banks. But Banks only fund the very well qualified generally no way a beginner is getting bank financing unless your basically borrowing your own money.
5. Resale what retail buyers are paying for rates of course affects the business dramatically.
But I will say its worth the effort in the long run at least for us..
Thank you for sharing your insights, Jay. It's very helpful to se the real challenges you've encountered across different markets- especially your point on finding qualified subs and staying away from high-rate lenders.
Giving the recurring issues with labor quality and scarcity, would you say automation tools like construction 3d printing or other tech are worth exploring? I'm curious if these new tech can somehow help me streamline certain tasks or reduce dependency on scarce trades in your experience.
Appreciate any additional thoughts
I looked at 3d printing those machines are 800k plus.. and if you watch the video you need very large lots as you have to bring in truck loads of sand etc.. so thats not really going to work in an urban environment like Charleston SC were I have built 35 plus homes in the downtown core on lots that are from 12' wide to max of about 30' and roadways that are only 20' wide and have houses and cars on every lot expect the infill..
I did reach out I was thinking of buying one and being a sub.. But I think your really limited to areas it will work in frankly. End product is cool though. - Member since 2024 · 3 posts · 0 votes1y
Really appreciate you sharing your persepctive on these tools!
Yes, thats what I thought about these systems. The gantry-type printeres are costly and hard to transport, so I was considering robotic arm types. They seem mostly suited for off-site wall segments production and I have to wonder about the economic viability in real-world projects.
Thanks again for the help
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