Posted on Thu, Aug. 27, 2009
If consumers are once again to spend the nation out of recession, we need more than Cash for Clunkers.
My brother, Dan Norburg, a self-employed home remodeler, called my attention to an impromptu video made last week by members of the Home Builders Association of Greater Kansas City.
I'm not overstating my reaction when I viewed it. It was scary. And sad.
Kansas City-area home builder names that I've known for decades stood in front of the camera to tell the effects of this recession and credit crunch.
Nancy Neighbors, a third-generation family member with Neighbors Construction Co., said her company had gone from 65 employees to 23 in the last eight months.
Don Julian, with Julian Builders, in business since 1974, said lenders are "paralyzed" and even banks with which he's had decades of unblemished relationships won't make new construction loans.
Wayne Burton with Western Chandelier - which has persevered since 1898 (!) - said the company had closed its Missouri location, laid off a little more than half the staff and was "struggling trying to make it."
Smaller companies have been reduced to family-only, kitchen-table enterprises.
"The emotion in everybody was just overpowering. I couldn't believe how they spoke off the cuff, out of their heart," said the association's executive vice president, Tim Underwood.
The video is being sent to congressional representatives in hopes that it will lead to recovery act assistance for the home-building industry.
"There's so much clamor on health care," Underwood said. "We have to find a way to cut through the clutter. We're not like General Motors, so those stories just don't get told."
You can watch the "stories" yourself at on youtube.
"Disaster" might be the word to describe what's happened to the home-building industry since the credit market collapse, said Jerry Ratway, who works in new-business development for Weber Carpet.
In a way, it doesn't make sense.
David Elliott, with Construction & Planning Service, pointed out that labor costs are low, material costs are low, interest rates are low. "We should be booming right now," he said.
But Troy Bellah, with Bellah Homes, told why they're not.
In the last seven months, he said, he's been to 45 banks, 10 of which he's had long-term business relationships with, including one of 25 years. Not one would make a new loan, he said.
Richard Rhodes, with Dusty Rhodes Homes, a builder since 1966, said: "We're concerned about surviving this market."
"We're drowning here," said Travis Graham with Graham Construction, who called for a life raft like that tossed to the auto industry.
Equally important, said Erik Blaney, with Shamrock Cabinets (which is down from 200 employees to under 100), is that "these are real people that are not working 40 hours a week" and not helping pull the nation out of recession.
"If we don't get housing on track, the economy doesn't stand a chance," Blaney said.
(c) 2009, The Kansas City Star.
Distributed by McClatchy-Tribune Information Services.
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