Monday, Jul 28, 2014

Highlands building market improves, builders say


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SEBRING - For Norb Walz, a long-time builder in Highlands County, construction is what he loves to do.

But making a profit from it remains a challenge.

"I've got a fine line there," he said.

Walz, who owns Walz and Co., said factors beyond his control, such as what subcontractors charge, determine whether he can get the project completed and make a profit.

These days, Walz and some other builders say that conditions that will allow them to make a profit are improving. But they also are not ready to predict that the recovery will be sustained and grow.

"We're not out of the woods yet," he said.

The situation remains a far cry from 2008 when builders constructed 132 single family homes and 17 commercial buildings.

The following year, the numbers dropped to 53 single family homes and 21 commercial buildings, but rebounded to 85 homes and 30 businesses in 2010. Ever since then, there's been a decline with only 30 new homes and seven new businesses being constructed in 2012.

But this year, the numbers have increased to 46 homes and 8 businesses with a month still remaining in the year.

Chad Pritchett, another builder, said he's "cautiously optimistic," and has seen a "little more interest out there," from potential customers.

But Pritchett said he doubts the boom will return.

"I don't know that it will ever be at that level again," he said.

He's in the process of building two spec houses - houses that are built without committed buyers - in Twin Lakes Subdivision, which is in the city limits of Avon Park, after having sold one spec house. Part of the reason he's building two houses is because of the improvement in the market, but some cost savings also result from building two at once, he said.

Pritchett, owner of Heartland Construction, said he's tried to make the houses more enticing to buyers by adding some features, such as crown molding and granite inside the house.

While many of the builders say that remodeling jobs have kept them in business, Pritchett said, he makes a living also by being a full time real estate appraiser.

He's also made money through buying some of the unfinished homes not completed because of the real estate bust and finishing the dwellings.

There's only so much time to do that, he said, because the structures deteriorate over time, leaving a situation where "you have to tear it down and start over."

One irony of the situation is that it has become more difficult to find good workers because many who were in the construction trade moved to something else during the downturn.

Bill Brantley II, who owns Brantley Construction, located in Lake Placid, said he's built five homes along Lake June and is starting work on another four.

"Things have definitely started to pick up," Brantley said.

He said improvement in the economy in Miami/Fort Lauderdale area is part of what has brought that about.

All but one of the homebuyers is a weekender, he said, adding that people from south Florida buy homes and come up during the weekend along with their children. That provides them with quality time with their children before they grow old enough to leave home, Brantley said.

"They want to build memories rather than wait until the kids go to college," Brantley said.

Many of those people have friends who already bought weekend homes, he said.

Brantley said many of the home buyers use their weekend homes as permanent homes after retiring.

In Sebring, where the market is different, Walz said, it is still recovering from the boom.

"Sebring to some outside investors looked like a good deal," he said. But as investors bought more homes and prices went up, the bottom fell out of the boom, Walz said.

One of Highlands County's biggest selling points was an affordable lifestyle, he said.

"We became priced out of that niche we had," he said.

Now, he said, as foreclosed homes get sold and prices start to rise, people begin to see new homes as a good alternative to buying an older one and facing higher maintenance costs.

Walz, who said he was the builder for the Fairmont Plaza and the plaza behind the Lakeshore Mall, said he aims to build unique homes. Generally, as long as he is the builder, he said, he designs the house at no extra cost.

"I don't do cookie cutter homes," he said.

He's built two homes in County Club of Sebring.

Ken LeBlanc, president of The Cottage Co., also said he sees improvement in the market. He's been constructing four new homes in the Covered Bridge subdivision near Lake Placid and he sees a good chance for other prospects.

He's now beginning work on a $3 million multi-purpose building for First Presbyterian Church in Lake Placid.

Linda Carroll, who works in the office at the church, said the building will be used for various church events, including musical productions, dinners, wedding receptions and indoor sporting events.

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