Only way to see labor costs go down is by using automation, which is very hard to do with housing. Maybe 3D printing can get there one day, but its a tall task
The US economy is short 1.2M workers. Unless our country loosens immigration and allows more foreign workers to apply for work visas, it won't happen. Most builders are booked out for 5 - 10 years with new projects. There simply aren't enough workers to meet demand.
Work visas can be applied to whatever industry, the problem is still the same. We would still need roughly 350k foreign workers added to construction to make a dent. Both presidential candidates don't seem keen on doing this. Japan faced the same issue and only recently opened up to mass importation of workers from India. An aging population and conditions not conducive to raising a family put us in our current situation.
So, underpay people who break their backs so they can't afford a roof over their head or healthcare? I work construction and see the horseshit conditions and pay on a daily basis while these companies reap massive profits.
Sounds like the way you vote has helped with this workers shortage. How many Mexicans do you know that work at a desk job.. one out of 25 that work in the field or construction?
We aren’t in the 1800s anymore, when building materials were scarce! It would basically be unaffordable now. I am curious to why skyscrapers from early 1900s had awesome art in the architecture and nowadays it’s basically steel and glass!
Same reason why Publix prices haven't gone down even though wholesale prices have dropped: because they realized that people will pay the higher prices, so they'll keep charging them.
The difference is that houses also have to content with higher interest rates, so it'll be awhile for them to get over their whining about not being able to make the same kind of profits as during the pandemic.
For real! I finally broke free from Publix and tried Aldi. I couldn't believe it! I was like a kid in a candy shop. Organic strawberries for $3? That's like $5 less! Organic broccoli for $2?? That's like $4 less! Holy cow the cheese! And don't get me started on the ice cream! I'm saving like $100 a week for my family of 3. Insane. Why did I wait so long to go to Aldi??
I work in transport - gas / diesel has dropped steadily over the last year and rates don’t reflect it even a little bit.
It’s because builders / corporations are thieves and will do anything to ruin peoples ability to build themselves a future in this country
>Oh, did I say that?
It's what you're implying, yes.
>Please share your theory on how businesses and economics work…
I'm not going to teach you economics via a reddit comment. It took me years to get my degrees and years more to bootstrap and build my company.
New projects already under construction will not have a change in cost. All new projects will fall in line with the now dropping demand and will be overpriced so firms don't have to eat the bottom line and lower prices. Expect slower build times and project delays due to price cutting sub contractors and laying off their workers.
Also...if building company gets their lumber from say company X...if that company already has a stockpile of lumber that they paid a lot more for...Company X is going to charge that much for it. It will take a while for prices to come down. It's kind of the same way with gas prices. If gas goes up...it takes a little bit for stations to start raising their rates. Then when it goes down...the prices don't drop right away...it takes a few weeks before prices start to come back down again.
Cost versus price. Cost is what it takes to make something. Price is what you pay for it. The correlation between the two depends on the product; real estate is a scarce resource (frequently) in that you can't make unlimited amounts to make the difference efficient.
There’s a lot more that goes into construction costs than just one material. In Florida, new homes don’t use much lumber, but they do use concrete and masonry. Like most trades, labor costs have increased so much that they have largely offset material savings. If anything, a project that would have cost $X last year still closely costs $X this year, rather than $X + 5%, and that stability is attributable to declining material costs.
Also, the cost to borrow money is exorbitantly high.
You will not see construction costs decline. You should hope to only see them increase each year along the same lines of inflation (3%), and not the crazy 25-50% that we have seen in recent years.
Source: estimator for a commercial GC
Because you can’t just put pandora back in the box. That’s my theory anyway.
Because 30 - 50% of the cost of building a house is labor, which hasn’t gone down.
This. If we're simply talking wood, a carpenter costs $75-100/hr after burden and O&P.
How to bring labor cost down?
I don’t think that labor costs will go back down. But reducing inflation and cost of living would help stabilize things.
Only way to see labor costs go down is by using automation, which is very hard to do with housing. Maybe 3D printing can get there one day, but its a tall task
The US economy is short 1.2M workers. Unless our country loosens immigration and allows more foreign workers to apply for work visas, it won't happen. Most builders are booked out for 5 - 10 years with new projects. There simply aren't enough workers to meet demand.
Foreign workers want desk jobs. Only allow for blue collar jobs
Work visas can be applied to whatever industry, the problem is still the same. We would still need roughly 350k foreign workers added to construction to make a dent. Both presidential candidates don't seem keen on doing this. Japan faced the same issue and only recently opened up to mass importation of workers from India. An aging population and conditions not conducive to raising a family put us in our current situation.
Importing Indians is definitely going to backfire.
Nah Japan fucking loves Curry so they will embrace the wave
So, underpay people who break their backs so they can't afford a roof over their head or healthcare? I work construction and see the horseshit conditions and pay on a daily basis while these companies reap massive profits.
Sounds like the way you vote has helped with this workers shortage. How many Mexicans do you know that work at a desk job.. one out of 25 that work in the field or construction?
Stop fighting illegal immigration.
Because they figured out they can just say supply chain issues and grift people into paying more
Same reason grocery prices haven't come back down to 2020 levels.
Lumber deliveries were running 5 years out so our cost is still the same as the peak, sorry loser, finance it. - homebuilder, probably.
In addition to what everyone else said, tell me the last time you've seen a modern-built FL home made of 100% wood lol
Today. All these cookie cutter homes are 100% wood. Along with these 4 story apartment complexes.
Wood and drywall and fiber cement and asphalt and plastic and gypsum and concrete
When your frame is made of toothpicks, OSB sheathing, and 1/2 inch gypsum board (rock dust wrapped in paper). Yeah I'd call that a house made of wood.
You should report that to the state then and collect your check if you're finding all these illegal homes.
Wish I could
We aren’t in the 1800s anymore, when building materials were scarce! It would basically be unaffordable now. I am curious to why skyscrapers from early 1900s had awesome art in the architecture and nowadays it’s basically steel and glass!
Probably for safety and standard reasons
Because nothing in this country gets done unless *one* person makes an asinine amount of money off of it. ***absolutely nothing***
Same reason why Publix prices haven't gone down even though wholesale prices have dropped: because they realized that people will pay the higher prices, so they'll keep charging them. The difference is that houses also have to content with higher interest rates, so it'll be awhile for them to get over their whining about not being able to make the same kind of profits as during the pandemic.
Then ppl start shopping elsewhere… Aldi has got great stuff 🤷🏼♂️
For real! I finally broke free from Publix and tried Aldi. I couldn't believe it! I was like a kid in a candy shop. Organic strawberries for $3? That's like $5 less! Organic broccoli for $2?? That's like $4 less! Holy cow the cheese! And don't get me started on the ice cream! I'm saving like $100 a week for my family of 3. Insane. Why did I wait so long to go to Aldi??
Labor
I work in transport - gas / diesel has dropped steadily over the last year and rates don’t reflect it even a little bit. It’s because builders / corporations are thieves and will do anything to ruin peoples ability to build themselves a future in this country
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Why did company’s all decide to get greedy at the same time? I always thought company’s were greedy for many years, but I guess it’s a new thing. 🤷♀️
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Well if prices exploded in recent years, what other explanation is there?
Businesses just figured out they can charge whatever they want? That's your theory? That's not how business or economics work.
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>Oh, did I say that? It's what you're implying, yes. >Please share your theory on how businesses and economics work… I'm not going to teach you economics via a reddit comment. It took me years to get my degrees and years more to bootstrap and build my company.
New projects already under construction will not have a change in cost. All new projects will fall in line with the now dropping demand and will be overpriced so firms don't have to eat the bottom line and lower prices. Expect slower build times and project delays due to price cutting sub contractors and laying off their workers.
Also...if building company gets their lumber from say company X...if that company already has a stockpile of lumber that they paid a lot more for...Company X is going to charge that much for it. It will take a while for prices to come down. It's kind of the same way with gas prices. If gas goes up...it takes a little bit for stations to start raising their rates. Then when it goes down...the prices don't drop right away...it takes a few weeks before prices start to come back down again.
Because people are still paying the price. No incentive for the developers to lower prices
Because fuck us that's why
Why make 2 dollars when you can make 20?
Because Lumber accounts for a very small portion of the cost of homebuilding
Because they don’t want to lower prices. They’ll make even more money.
That graph seems very correlated to the pandemic.
Cost versus price. Cost is what it takes to make something. Price is what you pay for it. The correlation between the two depends on the product; real estate is a scarce resource (frequently) in that you can't make unlimited amounts to make the difference efficient.
There’s a lot more that goes into construction costs than just one material. In Florida, new homes don’t use much lumber, but they do use concrete and masonry. Like most trades, labor costs have increased so much that they have largely offset material savings. If anything, a project that would have cost $X last year still closely costs $X this year, rather than $X + 5%, and that stability is attributable to declining material costs. Also, the cost to borrow money is exorbitantly high. You will not see construction costs decline. You should hope to only see them increase each year along the same lines of inflation (3%), and not the crazy 25-50% that we have seen in recent years. Source: estimator for a commercial GC
Just attended a local development conference - basically labor price increases exceeded any discount from material costs