Ive had my face in the paper reading all the bad news of most people going under other than us ! Seems construction has held its own in most places and is figgured for an increase now by our president after terrorism is out of insurance. Soon to be effective. My area is booming , with more houseing starts than in the last several years . I just read the print out on it sent to me from our mayor elect . Hes already getting with the program. Any way I read about Boston and California and rising construction costs are blamed . I talked to the manager from the lumber yard a short time back and he said lumber is the cheapest it been in a while. Interrest rates are also the cheapest in a long time.
The only things that are left are costs by the cities , land , and wages .
So is it us ?
Tim Mooney
Replies
Recent information that came out either yesterday or the day before, new housing startup was down 11% in October compared to September, a drop was expected but not that drastic.
What I was referring to was labor rates . Are you charging more money?
Tim Mooney
Seems like around here things are as busy as they've ever been. My neighbor tried for 3 months to get a bid on re-siding his house, but never got one. My Brother has been trying since August to get seamless gutters put on his garage, but still can't get it done.
Labor rates have gone up some, but it's hard to tell how much. As little as 2 years ago, there were contractors charging anywhere from $18 to $24 an hour. Now they're running from $25 to $28. And all of them complain that they aren't making any money.
It DOES seem like rates should have gone up more. The contractors can't get/keep good help, because they say they can't pay them enough. They have work coming out their ears - Everyone around here has people beating down their doors to get work done. And yet they don't raise their rates.
Doesn't seem right to me.
It is an unfortunate fact that we can secure peace only by preparing for war. [John F. Kennedy]
I guess that we have went up from 40 dollars a square foot to about 44 over a three year period . 3 dollars per square ft of that was in labor . Funny thing is the hands are making about the same. The subs are the ones comming out to the better. This price is for a new house with no extras on a flat lot. The land prices have risen some what.
Working builder at 20, lead man at 15, carps at 12, apprentice 10, labor 8.
Theres a lot of work out there and its for the choosing not the getting .
Have your trusses had an increase ?
Tim Mooney
I think you ALL deserve a raise. I would quote here what I think you as builders should charge an hour, but I won't. Figure Sonny will be here before long to say something on this. To be honest the rates you quote are in line with what is going on here, but I think that is too cheap for the builder. That is my opinion, but what do I know. I tell Lars he needs to up his rates, the problem is here there are too many jumping into the field and it is becoming more cut throat. Too many think they can build. What is going to happen is they will call the ones that can build somewhere down the road to fix the messups. Tamara
Don't really know if truss prices have gone up any - I don't really deal with pricing. (Which I don't like)
I doubt they have - Pricing is so competitive, it's hard to squeeze any more out of the system. And lumber costs fluctuate all the time, so it's kinda hard to gauge. The shop guys get a raise each summer, and I think the company adjusts their labor costs accordingly at that time. But I doubt the percentage of markup has changed much, if any.
Actually, Lead times on orders have been lower this year than last year. We added some production capacity, and our competition also has, so that may have something to do with it.
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I'm not sure I understand your terms exactly. What do you mean by "Working builder"
And what's the difference between an apprentice and a laborer?
There aren't really any "labels" around here unless you're in the union.How did a fool and his money get together in the first place?
"I'm not sure I understand your terms exactly. What do you mean by "Working builder"
And what's the difference between an apprentice and a laborer?"
Working builder first; We seem to have about three different types of builders here in my definition;
1.Realestate broker has a builders license and his name being on the permit as such. They usually have a working super.
2. We have the old builder type that doesnt ever have on an apron . He is more of a business man getting the work from his name that has been around a long time. He does it all except the actual work. He usually has foremen, or lead carpenters, and some have both of course .
3. The guy that has a crew and is there most every day doing the work with his crew supervising. He does all the techincal stuff on the job. He just has one crew and stays with them. This is the type I refer to, because the top two work off cost plus or bids normally with out getting a wage, for they arent there.
In my definition and the union ; A laborer just humps material, cleans , stacks , hauls material between the cut man and the nailing crew, scaffold set up, digs , etc. He has no training . Thats what you get from Tempoary Manpower , or the type you pick up being the same.
An apprentice could be a one year or a four year , but he is actually practiceing the work of carpentry. Of course his experience determines what he would be doing.
Tim Mooney
Locally, (small town in Michigan's UP) , recent tornado has everybody who wants to be working doing so. Rates for residential builders stable at $20-38 per hr. Although I'm sure the insurance companies are seeing much higher rates. Question to me is, when the repairs are all done, will the guys try to keep their rates up? Doubtful. People won't accept it out of their own pocket. Personally, I don't have time to get involved in the insurance work. New housing is looking up. Have 4 serious prospects for spring starts, and am just getting the foundation in for the winter project. Lately , alot of prospects have been desiring to provide their own materials, and with HD opening soon this will most likely increase. Because of this, my rates will be adjusted to compensate for lost P & OH, from material markup. Once you get used to this, it actually works pretty well. No suppliers to pay= less paperwork. I still handle delivery scheduling and material specification, to eliminate schedule problems.You must apply some due dilligence to the customer's financial management(Call suppliers to make sure bills are getting paid), but most of us prescreen our customers don't we? Yes, I know there are those who will say that we aren't charging enough. But , it's what the market will bear. I consider myself fortunate to be at the higher end of the market, and not competing with the" just working for wages guys". I'm not getting financially rich, but I get to live in a very beautiful, rural area. With no crime, good schools, and natural resources abound. Well, what do you know, I am rich!!!!!!!
Brudoggie," sorry to ramble from the subject"
The tornado will cause some of the rates to go up and stay. Mostly the trades that needed to go up in the first place. Roofing will go up for quite some time because the normal work load will experience a shortage of labor for about a year . Supply and demand always dictates prices with anything I know.
There will always be those types out there that work cheap, just as there will be those who charge more money for the big houses. There will always be a need for both types because of the types of builders out there. Its been that way all my life .
Its taken me a long time to understand that we dont need to give away whats in our head . Doctors charge for whats in their noodle , as does a lawyer. You are the same . If they buy their own materials you should still get paid a premium for handling , and your knowledge of what to buy and where to get it , just like all the other knowledge you have in your head. Simple fact is that it is something the customer is asking for , but couldnt handle theirselves. If they are willing to work full time fetching materials then I think they could handle it , but normally they have a day job . Ive had a few try with no help from me and it didnt take long to wean them off the idea. They keep going after the wrong things . Back and forth they go listening to salesmen , and not listening to you totally. WE dont have time to deal with them on bid either , by the hour the bill gets pretty high for their non performance . They dont belong there just like we dont belong in surgery , or in court .
I enjoyed the ramble I read ,
Tim Mooney
Tim, Let me jump in and answer the question with a, heck yes my rates are up!
Like you said… Supply and Demand
Right now demand is way up and supply is low so my rates are up.
Scott R.
They just pay the yard,on their own account. I get paid extra on my rate to handle the scheduling. At times it works out to a better margin for me! Shhh!! Local yards are willing to give just about anyone the same discount on materials as they give the Contractors. Nice Huh? Flexibility is essential these days. Gotta roll with the changes. Basic demographic of customers requesting this: Younger (30s-50s) well paid white collar people. Trying to build that McMansion on a budget. Most don't realize that this can cost them more, in the end. But why talk, if they are'nt listening. Just send the bills, and smile. They are rarely interested in a fixed contract price, think we're hiding some great unknown (to them) profit in there. Oh, well. Have a good one!
Brudoggie
LOL! I hear of that happening every day = Time and Materials . There was one build across the street from me that the price they had calulated was 500 thousand being their own contractor ! Ended of up at 750 thousand . As Nixon would have said ; "a slight over sight. " No contractor seemed to be glued to a price , and the work went on ,...... When are people going to respect a contractor ? They wouldnt think of performing surgery on their wife or trying their own murder case. Life savings were dumped into this house , and they would not pay a contract price , or a percentage above cost. Its just as you say that they think we are getting rich off of them and they can save so much money. I sometimes wonder why they dont look at our life style. You are right ; Just keep sending the bills and keep smiling .
Tim Mooney
What I don't understand is why some people who have absolutely no background in building, construction, contracting etc think they can be their own GC. Theres to much that goes into it from design to completion, planning, inspections, materials delivery times, the knowledge of local suppliers in case one cant get what you need, scheduling the difference trades in a sensible order and so they are not bumping into each other, etc etc. I have a hard time believing its true but one of my coworkers told a story of a guy being his own GC and trying to get the insulators to come in before the plumbing and electric because both plumbing and electric were back logged and the guy didn't want his house to sit for a week. Plus they have to have real jobs and running a construction site for a home is a full time job in itself.
WEll ,it happens all the time . They dont even know who to hire , and what makes that worse is that the people doing the work know they arent going to build but one , so its not repeat business. The tradesmen get by with telling them what ever will make their job easier. Ive seen this happen to severity to moderation. Ive seen them schedule people before it was ready and also most of the time schedule too soon. They dont have a clue what they need to buy , they just know some of the things they dont. They have a million questions and they take advice from an 18 yr old working at Lowes. Ive never wanted any part of it , but it is profitable. They always go over budget , because they got a bid from a contractor before they started on their own. Of course theres no way they can be as efficent as him if hes worth his salt. They cant even get the deals a contractor gets from subs. Its really pretty hilarious. Of course if they have some one that has the knowledge that will put up with them, they get through it. I agree with you , but it happens every day .
Tim Mooney
To be perfectly honest, would you want to be the GC for some like that though, probably better off with out them
Jees, youse guys make this GC thing sound hard.
I always wanted to be my own GC too.
Of course, for me it would mean hiring out the concrete work, ordering rafters, and hiring the drywallers (cause I hate drywalling, can't imagine doing a whole house, SHUDDER).
The rest of it I'd do myself. Love plumbing, roofing, electrical, etc.. But, my wife refused to live in an old trailer house next to the building site for a year or so while I did it.
Now, as far as trying to do a house the normal way, like you guys do. I'd lose my shirt if I hired everything done and tried to manage it. Those dang construction guys don't seem to want to work 6PM to midnight like I do.
Well, if they were paying me a good hourly rate I could stand it , but I wouldnt want to be held to anything . But of course there are many jobs I would choose over it .
Tim Mooney
...'Well, what do you know, I am rich!!!'
Roar! Hit it on the head there with quality livin' and 10-4 to you good buddy! Let the thunder crack and the waves roar.
We're going on.