Inflation - Tulsa Home Builders Edition

[NationalMatch]

Shaw builds a lot of pretty ****ty houses.

I build a few pretty nice houses.

His costs have indeed gone up, I can guarantee you that. It cost me 28% more in materials alone to build one in 2021 over what it cost me in 2020.

My selling price on 2 pretty similar homes, with the last one being 55 sq ft smaller was over $80k more for the one built in '21, and it took me 3 months longer to build it.

That's not all; it gets worse. The waiting time on windows and brick have more than doubled from '21 going into '22.

Currently 22 weeks to receive windows, and 6 months on brick, if you order them today.

It's really pretty hard to put a number on that, but I'd never go so far as to excuse Shaw Homes for bad behavior. I'm just saying, everything he's saying isn't BS.

What's your opinion of barndominiums? Similar supply issues? Resale? Quality?

 

[kroberts2131]

Seven years ago we were looking to build. We wasted three months working with Shaw designing and finding a site. The whole time it seemed like a horrible used car deal. The lady we was working with said building a home is one of the most stressful things you will ever do. Maybe building with Shaw it would be. Ended up building with another awesome builder who I have referred four or five people to. I'd build another with the builder we used in a heartbeat.

Many houses in our neighborhood have window leaks that Shaw says is normal and other issues that they won't honor warranty work.

i had the leaky window happen with them but I made them fix them all. It took some serious harassment. The design studio lady was also a total bitch and ruined that part of the experience for us. I didn’t even go to our last appt.

 

[jakeman]

What's your opinion of barndominiums? Similar supply issues? Resale? Quality?

I'm not a fan, but I don't hate them.

Other than bricks & shingles it takes the same materials. Interior finish is still interior finish. I don't build the buildings, so I couldn't tell you on total cost but I'd bet it isn't as cheap as some might believe when compared to a conventional home. Wouldn't know on resale either. I've never owned one, but I know you can't get your money back on a metal shop building if you sell the property you built it on.

Quality is just like everything else. It depends on who does the work and what kind of interior finish you install. Once you get the metal building up, interior studs up and insulated and drywall installed, it's just another house. You can do plastic showers or full ceiling to floor ceramic. Screw in cabinets or custom built on site. Formica or granite, etc, etc, etc.. You're only limited by your creativeness and your budget.

 

[jakeman]

Right, and you don’t hedge with a supplier, but a bank, financial institution or exchange.

That's money and not materials.

Completely different deal.

I've hedged zinc dust before. eleven truck loads or 440,000 lbs. Hedging materials is different than hedging $'s. You also have to consider when you hedge, it's still a gamble.

 

[jakeman]

I actually have empathy for you and all builders right now. You're stuck between rocks and hard places through no fault of your own.

That being said, a savvy consumer would never sign such a contract. The variables are too great to accurately estimate the negative impacts down the road. I'd walk away and either plot a new course, or just sink my money in more secure investments and ride the storm out.

Not to worry, most consumers are NOT that savvy.

I wouldn't sign it either as a home buyer.

I wouldn't try to build a house right now though. People can't expect their builder to lose money, and I'd think they wouldn't want that anyway. You have a supplier, of either labor or materials, that's losing money on your project, you need to be very careful. You're about to get what you're paying for.

edit - I'll also add, if as a consumer you're expecting someone to give you a hard number on something that goes together like a home in the current, and they do, you should be concerned. I'm new to this, but I know guys that have been doing this for 30 years, and they can't tell you what it's going to cost to build something right now. Oh, they can probably get between 35%, maybe, but until it's bought and invoiced you don't know what the materials are going to cost, or if your sub is going to still be working for you next week. Building anything is expensive right now, and it's hard because of chasing materials.

 

[NationalMatch]

I wouldn't sign it either as a home buyer.

I wouldn't try to build a house right now though. People can't expect their builder to lose money, and I'd think they wouldn't want that anyway. You have a supplier, of either labor or materials, that's losing money on your project, you need to be very careful. You're about to get what you're paying for.

edit - I'll also add, if as a consumer you're expecting someone to give you a hard number on something that goes together like a home in the current, and they do, you should be concerned. I'm new to this, but I know guys that have been doing this for 30 years, and they can't tell you what it's going to cost to build something right now. Oh, they can probably get between 35%, maybe, but until it's bought and invoiced you don't know what the materials are going to cost, or if your sub is going to still be working for you next week. Building anything is expensive right now, and it's hard because of chasing materials.

Back in the day, my folks had two construction companies. One union. One nonunion.

Union was for big budget contracts. Govt. stuff. DOD/Fort Knox. Housing authority of Louisville.

The other was nonunion. That was for smaller jobs that didn't require union labor. Both the above (DOD and HAL) required union.

But back then, they sometimes got jobs for cost plus. That took into account sliding materials prices, etc. Otherwise, the bid was the bid. Go over budget? The latter meant he ate the difference.

 

[rickm]

The problem i have seen is that they are quick to raise the prices when the cost goes up but when the cost of materials goes down they wont adjust the cost if they are into the project, i understand that prices fluxuates from time to time but the builder should show their clients where the extra cost is going not just say it is going up and no way of showing where.

 

[Glocktogo]

I wouldn't sign it either as a home buyer.

I wouldn't try to build a house right now though. People can't expect their builder to lose money, and I'd think they wouldn't want that anyway. You have a supplier, of either labor or materials, that's losing money on your project, you need to be very careful. You're about to get what you're paying for.

edit - I'll also add, if as a consumer you're expecting someone to give you a hard number on something that goes together like a home in the current, and they do, you should be concerned. I'm new to this, but I know guys that have been doing this for 30 years, and they can't tell you what it's going to cost to build something right now. Oh, they can probably get between 35%, maybe, but until it's bought and invoiced you don't know what the materials are going to cost, or if your sub is going to still be working for you next week. Building anything is expensive right now, and it's hard because of chasing materials.

Oh I do know! I just completed a full gut master bath remodel and that shizz was WAY expensive. I went through one bad builder and broke the contract before they ever set foot inside with a tool (they lied to us several times and we caught them doing it). Fortunately they exceeded the time allotment in their own contract, so they didn’t fight it too hard.

On the second time around, we went through a national aggregator to source a highly rated local contractor. Before we even signed the contract, we had most of the major components on the ground in our shop. We designed the space and spec’d all the materials ourselves. We did however solicit the builder’s input on everything and agreed to some minor changes for cost and efficiency reasons. We made no change requests after the contract was signed.

When it came time to fulfill the contract, everything we were to supply materials wise was already on site. All they had to supply was the raw materials (lumber, drywall, mud, tape, etc.). We even provided space inside our shop for them to leave their trailer and work. We were and I quote “the easy button of clients”.

They still came in $1,800 over budget, but that’s because a wall we were having them tear out that shouldn’t have been a load bearing wall, was. It was easy to see where the extra cost went based on how much lumber and time they had up in the attic.

Overall we were VERY satisfied with their honesty, integrity and work product. They were happy with us and everyone agreed it was a good experience. After we paid the balance due, we handed out individual bonuses to the workmen for their efforts and customer service skills. After we posted positive reviews online, the company owners sent us a very nice hand written thank you card, with a gift card to Target enclosed.

If only all our other contracting jobs went that well!

 

[joegrizzy]

What we have found out from our recent home build is that the Central Oklahoma Home Builders Assoc. couldn't care less about consumer protection or advocacy. They are a club of and for builders, that is it. We are still going through what will be years of fighting a large laundry list of issues with our builder that are contractual, competency, and criminal based.

If anyone is thinking of building in the area, I am happy to share our experience over a coffee or something, but I won't be sharing any names online until all of our issues are settled.

even worse; they hire people who aren't even americans. all hail the God: profit

 

[mr ed]

Everybody has about doubled their prices. Some will regret it for gouging.
Some can't help it because materials have gone up.
My heat and air guy was $6500 for a unit installed. Now $9500-10k Don't think the machines went up that much.
Tile guy doubled but paying the Mexicans the same.
Tree trimmer doubled. Got somebody else. did a better job at way cheaper price.
$85 plumbers and electricians now $125-150hr.
Roofer went up 50%
Even though I do the sheetrock and paint myself the stuff has doubled.